Lets talk first about how to apply for employee retention credit in Alcoa for Museums …
Anytime if you have employees between five and five hundred so I have actually got the specialist with me this is Josh Fox he’s the founder and CEO of bottom line Principles they’re the largest processor of these ERC credits this is a 170 page program so it’s hard this isn’t like PPP we just phone your bank manager and say provide me a loan it does not work there’s not a loan it’s an application and Josh is going to tell us all about it and how to get it and why I’ve ended up being yes the Ambassador and paid spokesperson for this I love this program it’s going away soon you got to discover everything about it let’s talk employee retention credit Josh Fox what is an ERC let’s simply begin there so throughout the Trump Administration when President Trump was enacted they developed the cares Act and the cares act used organizations three opportunities you had the PPP loan you had the eidl loan and you had the ERC tax refund and almost everybody it makes a huge distinction right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
remedy the cash money payroll tax refund all right go on sorry I just have to ensure we got that point I suggest that’s a huge difference a loan versus money cash I like cash money that’s what we’re speaking about okay and the other loans are done so we’re sitting here in 2023 and the eidl is over the PPP is over and the only one left from the initial cares Act is the ERC and yes Kevin it is a stunning tough check in the mail where you get real cash from the IRS all right so let’s discuss how it works due to the fact that it seems like to me if it’s a if it’s employee retention credit that person had to be an employee so I’m going to make the Assumption this money is not for the owner not for people on the cap table not for shareholders it’s for employees right you needed to have owned a company but it’s based upon you having W-2 employees in America not 10.99. so as long as you had W-2 workers and you paid federal payroll taxes that’s why you would be eligible so you need to be on payroll in 2020 on the W-2 and you have to be on payroll for the first 6 months of 2021 on the W-2 appropriate so there were six quarters the program was open well walk us through the 6 quarters so you had quarters two three and four of 2020 and you had quarters one two and 3 of 2021. all right so that’s how it’s determined you need to be on the W-2 during that duration now let’s talk my preferred part money how much can you get back per worker that was on a W-2 in those six quarters so the estimation in 2020 to be precise Kevin is 50 of the staff member’s salary to an optimum of five thousand dollars per employee for the year of 2020 and in 2021 the numbers escalated to 70 of the employee’s salary to an optimum of 7 thousand per quarter how did that occur um they just changed the rules in.
2021 versus because the mayhem of the pandemic so they wished to even get more to keep those workers on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 as much as 5 thousand Max and then what occurs 21 000 Max in 2021 oh that’s how you develop twenty 6 thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty six thousand dollars per employee that is because that’s a lot of money it is now there’s a caution here the PPP cash would need to be reduced from the twenty six thousand dollars so if you took PPP loan one and PPP loan two you would lower the 26 000 so what we’re seeing typically Kevin is if you took PPP money someplace around 10 thousand dollars a person so let’s say hypothetically you owned a dining establishment in New york city City where I’m from and you had a hundred workers and you took PPP cash you would still get a million dollar in the mail from the internal revenue service so it’s huge undoubtedly now the big concern is why does nobody learn about this because look when I first became aware of this when I first satisfied Josh you understand I have actually got great deals of financial investments in lots of companies I’m a significant advocate for entrepreneurship in America and make many many investments in business owners of which lots of suffered through the pandemic when I initially found out about this I called BS I don’t think it due to the fact that I utilize the PPP we went through the cash center Banks to get it it was very easy to do we had our CEOs call the banks they got their loans and that were well been worthy of and we used them carefully to survive throughout the pandemic so when I heard about this I said nah it can’t hold true however when I dug around I even contacted us to my politician friends Governor Senators they didn’t understand about it I indicate that’s how you know that’s how misinformation is that there’s no information out there then a bunch of people informed me well you can’t get it due to the fact that you took the PPP also not real so let’s ask Josh why does nobody know about the worker retention credit you understand what’s fascinating you’re discussing the banks Kevin since in the PPP loan process the federal government made it really clear that if you wanted a PPP loan you would call Wells Fargo Citibank Bank of America any of the big banks in our country and they would process procedure in Canada a pre-pp loan there’s no loans in Canada by the way it’s just process procedure that’s all um and here there was mayhem due to the fact that remember in the original cares act you might refrain from doing both programs so if you had actually done PPP you could not do ERC in the initial program and when they changed the law in 2021 the banks were refraining from doing ERC since it’s not alone so you’re getting a tax refund so the government never made it clear to anyone about how to.
do this does your CFO know how to do this not truly she or he’s never ever done it previously do the banks do it nope the banks do not do it the payroll business yeah some of them are doing it as a payroll business your accountant no your accounting professional’s never ever done this before unless you have an account that went into this company and bottom line my firm Kevin has been in business because 2009 and we’ve been dealing with the federal government and the state federal government to recover cash for Fortune 500 Fortune 1000 business so a lot of our big big business clients have dealt with bottom line to recuperate other government programs we’ve done sales tax and utilize tax joblessness tax work chance tax credits research and development tax credits unclaimed property real estate tax all of these other federal government programs.
The employee retention tax credit is a broad based refundable tax credit created to motivate.
Are you Eligible for Alcoa Museums ERC Find out now
companies to keep workers on their payroll. The credit is 50% of up to $10,000 in wages paid by an.
Since of COVID-19 or whose gross invoices, employer whose company is fully or partly suspended.
decline by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt companies. There are.
only 2 exceptions: (1) state and local governments and their instrumentalities and (2) small.
organizations who take Small Business Loans.
2. To qualify, the company has to fulfill one of two alternative tests. The tests are determined each.
calendar quarter– Either.
o the employer’s company is totally or partially suspended by federal government order due to COVID-19.
throughout the calendar quarter or.
o the employer’s gross receipts are below 50% of the comparable quarter in 2019. Once the.
company’s gross invoices go above 80% of an equivalent quarter in 2019 they no longer qualify.
after the end of that quarter.
Computation of the Credit.
The amount of the credit is 50% of the qualifying wages paid up to $10,000 in total.
It is effective for wages paid after March 13th and prior to December 31, 2020.
The definition of qualifying wages varies by whether an employer had, typically, more or less than.
100 staff members in 2019.
Companies that concentrate on ERC filing help generally supply knowledge and assistance to help organizations browse the complex process of claiming the credit. They can use various services, including:.
How is the employee retention credit calculated? Employee Retention Credit For The Employee
Eligibility Evaluation: These companies will examine your business’s eligibility for the ERC based on factors such as your industry, earnings, and operations. They can help figure out if you fulfill the requirements for the credit and identify the optimum credit quantity you can claim.
Documentation and Calculation: ERC filing services will help in collecting the essential paperwork, such as payroll records and financial statements, to support your claim. They will likewise help determine the credit amount based upon qualified wages and other qualifying costs.
Retroactive Claim Review: If you are eligible to claim the ERC for previous quarters, these companies can examine your past payroll records and financials to determine potential opportunities for retroactive credits. They can help you modify prior income tax return to declare these refunds.
Filing Help: Companies specializing in ERC filings will prepare and send the required kinds and documentation on your behalf. This consists of finishing Kind 941 or any other required tax forms.
Compliance and Updates: ERC policies and guidance have progressed over time. These companies stay updated with the current modifications and guarantee that your filings comply with the most current standards. They can also offer continuous support if the internal revenue service requests extra information or carries out an audit related to your ERC claim.
It is very important to research study and vet any business using ERC filing help to ensure their reliability and know-how. Look for recognized companies with experience in tax and payroll services, or consider reaching out to relied on accounting companies or tax professionals who offer ERC filing assistance.
Remember that while these companies can provide important support, it’s constantly a great concept to have a basic understanding of the ERC requirements and process yourself. This will help you make notified decisions and ensure precise filings.
The Staff Member Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief steps. The goal of the ERC is to motivate organizations to retain and pay their workers during the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is available to qualified companies, including for-profit businesses, tax-exempt organizations, and specific governmental entities. To qualify, employers must satisfy one of two criteria:.
Business operations were totally or partially suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. As mentioned earlier, for 2021, a substantial decrease is defined as a 20% decrease in gross invoices compared to the exact same quarter in 2019. For 2022 and beyond, a significant decline is defined as a 20% decrease in gross receipts compared to the very same quarter in 2019, or a 20% decline in gross receipts compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the employer’s share of Social Security taxes. The credit amount amounts to a portion (as much as 70%) of certified wages paid to employees, consisting of certain health insurance expenses. The optimum credit per staff member is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: Initially, organizations that received a Paycheck Security Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits organizations to declare the ERC even if they received a PPP loan. Nevertheless, the exact same incomes can not be utilized to claim both the PPP loan forgiveness and the ERC.
Retroactive Arrangement: The ERC has actually been retroactively broadened and enhanced, enabling eligible employers to declare the credit for certified salaries paid as far back as March 13, 2020. This retroactive arrangement supplies an opportunity for services to amend prior-year tax returns and receive refunds.
Declaring the Credit: Companies can claim the ERC by reporting it on their employment income tax return, normally Kind 941. If the credit goes beyond the amount of employment taxes owed, the excess can be refunded to the employer.
It is essential to keep in mind that the ERC arrangements and eligibility criteria have developed over time. The very best course of action is to talk to a tax professional or visit the official IRS site for the most up-to-date and in-depth info regarding the ERC, consisting of any current legal modifications or updates.
To receive the ERC, a company needs to satisfy among the following requirements:.
The business operations were totally or partially suspended due to a federal government order related to COVID-19.
The business experienced a considerable decline in gross receipts. For 2021, a significant decrease is specified as a 20% decline in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a substantial decline is specified as a 20% decrease in gross invoices compared to the same quarter in 2019, or a 20% decline in gross receipts compared to the immediately preceding quarter.
The ERC is available to companies of all sizes, including tax-exempt organizations, but there are some exceptions. Government entities and organizations that received a PPP loan might have restrictions on claiming the credit.
The process for claiming the ERC includes completing the needed forms and consisting of the credit on your employment income tax return (usually Type 941). The exact time it takes to process the credit can vary based upon numerous factors, consisting of the complexity of your company and the workload of the IRS. It’s recommended to seek advice from a tax expert for guidance specific to your situation.
There are several companies that can aid with the process of claiming the ERC. These include accounting firms, tax advisory services, and payroll provider. Some widely known companies that use assistance with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s recommended to research study and contact these companies directly to inquire about their services and charges.