Lets talk first about how to apply for employee retention credit in Michigan for Oilseed and Grain Farming …
Anytime if you have workers between five and five hundred so I have actually got the professional with me this is Josh Fox he’s the founder and CEO of bottom line Concepts they’re the largest processor of these ERC credits this is a 170 page program so it’s difficult this isn’t like PPP we just call your bank manager and state give me a loan it doesn’t work there’s not a loan it’s an application and Josh is going to inform us all about it and how to get it and why I’ve become yes the Ambassador and paid spokesperson for this I like this program it’s going away very soon you got to learn everything about it let’s talk worker retention credit Josh Fox what is an ERC let’s just begin there so during the Trump Administration when President Trump was enacted they developed the cares Act and the cares act provided organizations three chances you had the PPP loan you had the eidl loan and you had the ERC tax refund and nearly everyone it makes a huge difference right there two of them are loans and one’s a refund exactly so the ERC is a refund that’s.
fix the money cash payroll tax refund okay go on sorry I simply need to make sure we got that point I mean that’s a huge difference a loan versus money money I like money cash that’s what we’re discussing fine 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 original cares Act is the ERC and yes Kevin it is a beautiful tough check in the mail where you get actual cash from the IRS all right so let’s talk about how it works due to the fact that it sounds like to me if it’s a if it’s employee retention credit that person needed to be an employee so I’m going to make the Presumption this cash is not for the owner not for people on the cap table not for investors it’s for employees right you needed to have owned a business but it’s based upon you having W-2 staff members 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 qualified so you need to be on payroll in 2020 on the W-2 and you need to be on payroll for the very first six months of 2021 on the W-2 right so there were 6 quarters the program was open well stroll us through the 6 quarters so you had quarters 2 three and four of 2020 and you had quarters one two and three of 2021. fine so that’s how it’s determined you have to be on the W-2 during that period now let’s talk my preferred part cash how much can you get back per staff member that was on a W-2 in those 6 quarters so the estimation in 2020 to be precise Kevin is 50 of the staff member’s salary to an optimum of 5 thousand dollars per worker for the year of 2020 and in 2021 the numbers skyrocketed to 70 of the employee’s income to an optimum of 7 thousand per quarter how did that occur um they simply altered the rules in.
2021 versus since the mayhem of the pandemic so they wanted to even get more to keep those staff members on payroll 100 so if you can get 5 000 per person Max in twenty that was 50 in 2020 up to 5 thousand Max and after that what takes place 21 000 Max in 2021 oh that’s how you create twenty six thousand twenty one thousand to twenty twenty one plus 5 thousand in twenty twenty that’s twenty 6 thousand dollars per worker that is because that’s a lot of cash it is now there’s a caution here the PPP cash would need to be reduced from the twenty 6 thousand dollars so if you took PPP loan one and PPP loan 2 you would reduce the 26 000 so what we’re seeing on average Kevin is if you took PPP money someplace around 10 thousand dollars an individual so let’s state hypothetically you owned a restaurant in New York 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 know about this since appearance when I initially became aware of this when I initially met Josh you know I have actually got lots of financial investments in great deals of companies I’m a major supporter for entrepreneurship in America and make many lots of financial investments in entrepreneurs of which lots of suffered through the pandemic when I first found out about this I called BS I don’t believe it due to the fact that I utilize the PPP we went through the money center Banks to get it it was extremely easy to do we had our CEOs call the banks they got their loans and that were well should have and we used them wisely to survive throughout the pandemic so when I heard about this I said nah it can’t hold true but when I dug around I even contacted us to my politician good friends Governor Senators they didn’t understand about it I indicate that’s how you know that’s how false information is that there’s no information out there then a bunch of people told me well you can’t get it because you took the PPP also not true so let’s ask Josh why does no one learn about the employee retention credit you know what’s fascinating you’re talking about the banks Kevin because 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 process in Canada a pre-pp loan there’s no loans in Canada by the way it’s simply procedure procedure that’s all um and here there was mayhem due to the fact that remember in the original cares act you could not do both programs so if you had done PPP you could refrain from doing ERC in the original program and when they altered the law in 2021 the banks were not doing ERC because it’s not alone so you’re getting a tax refund so the federal government never ever made it clear to anybody about how to.
do this does your CFO know how to do this not really he or she’s never done it in the past 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 company your accountant no your accounting professional’s never done this prior to unless you have an account that entered into this business and bottom line my company Kevin has actually stayed in business because 2009 and we’ve been dealing with the federal government and the state government to recover cash for Fortune 500 Fortune 1000 business so a lot of our big huge business clients have worked with bottom line to recuperate other government programs we’ve done sales tax and use tax joblessness tax work opportunity tax credits research and development tax credits unclaimed property real estate tax all of these other government programs.
The staff member retention tax credit is a broad based refundable tax credit developed to motivate.
Are you Eligible for Michigan Oilseed and Grain Farming ERC Find out now
employers to keep employees on their payroll. The credit is 50% of as much as $10,000 in salaries paid by an.
company whose organization is completely or partially suspended because of COVID-19 or whose gross invoices.
decrease by more than 50%.
1. The credit is offered to all employers no matter size including tax exempt companies. There are.
just two exceptions: (1) state and city governments and their instrumentalities and (2) little.
organizations who take Small company Loans.
2. To certify, the company has to meet one of two alternative tests. The tests are calculated each.
calendar quarter– Either.
o the company’s service is totally or partly suspended by government order due to COVID-19.
during the calendar quarter or.
o the company’s gross receipts are below 50% of the similar quarter in 2019. As soon as the.
company’s gross receipts exceed 80% of a comparable quarter in 2019 they no longer certify.
after completion of that quarter.
Calculation of the Credit.
The quantity of the credit is 50% of the qualifying incomes paid up to $10,000 in overall.
It works for incomes paid after March 13th and prior to December 31, 2020.
The definition of qualifying incomes differs by whether an employer had, usually, more or less than.
100 workers in 2019.
Companies that focus on ERC filing support generally offer competence and support to help companies browse the intricate procedure of claiming the credit. They can offer numerous services, consisting of:.
How is the employee retention credit calculated? Innovation Refunds Refer And Earn
Eligibility Assessment: These companies will evaluate your organization’s eligibility for the ERC based on aspects such as your industry, revenue, and operations. If you satisfy the requirements for the credit and determine the maximum credit quantity you can declare, they can assist determine.
Documentation and Computation: ERC filing services will assist in gathering the required paperwork, such as payroll records and monetary declarations, to support your claim. They will also help determine the credit quantity based upon qualified wages and other certifying 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 possible opportunities for retroactive credits. They can help you amend prior income tax return to declare these refunds.
Filing Assistance: Companies specializing in ERC filings will prepare and submit the essential types and documents in your place. This consists of completing Type 941 or any other required tax return.
Compliance and Updates: ERC guidelines and assistance have evolved in time. These companies remain upgraded with the current modifications and guarantee that your filings adhere to the most present guidelines. If the IRS requests extra info or conducts an audit associated to your ERC claim, they can likewise supply continuous support.
It is essential to research and vet any company providing ERC filing support to ensure their credibility and proficiency. Look for recognized firms with experience in tax and payroll services, or think about reaching out to relied on accounting firms or tax experts who provide ERC filing support.
Bear in mind that while these companies can offer important help, it’s always a good concept to have a fundamental understanding of the ERC requirements and procedure yourself. This will help you make notified decisions and ensure accurate filings.
The Worker Retention Credit (ERC) is a refundable tax credit presented by the U.S. government as part of COVID-19 relief procedures. The goal of the ERC is to motivate services to keep and pay their employees throughout the pandemic, even if their operations have been impacted.
Here are some bottom lines about the ERC:.
Eligibility: The ERC is readily available to eligible employers, consisting of for-profit services, tax-exempt companies, and certain governmental entities. To qualify, companies should fulfill one of two requirements:.
The business operations were completely or partly suspended due to a government order related to COVID-19.
The business experienced a substantial decline in gross invoices. As mentioned previously, for 2021, a significant decline is specified as a 20% decrease in gross receipts compared to the same quarter in 2019. For 2022 and beyond, a considerable decline is defined as a 20% decline in gross invoices compared to the very same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
Credit Quantity: The ERC is a refundable tax credit that offsets the company’s share of Social Security taxes. The credit amount is equal to a portion (approximately 70%) of certified incomes paid to employees, including certain health insurance costs. The maximum credit per employee is $7,000 per quarter in 2021 and $10,000 per quarter in 2022 and beyond.
Interaction with PPP: At first, companies that got a Paycheck Protection Program (PPP) loan were not qualified for the ERC. Legislation passed in late 2020 and extended in 2021 permits companies to claim the ERC even if they received a PPP loan. However, the very same incomes can not be used to claim both the PPP loan forgiveness and the ERC.
Retroactive Provision: The ERC has actually been retroactively expanded and improved, enabling qualified employers to declare the credit for certified incomes paid as far back as March 13, 2020. This retroactive arrangement offers an opportunity for services to amend prior-year tax returns and receive refunds.
Declaring the Credit: Employers can claim the ERC by reporting it on their work income tax return, typically Type 941. If the credit exceeds the quantity of employment taxes owed, the excess can be reimbursed to the company.
It is essential to note that the ERC arrangements and eligibility criteria have actually developed gradually. The best strategy is to speak with a tax expert or visit the main IRS website for the most comprehensive and updated information regarding the ERC, consisting of any recent legislative modifications or updates.
To get approved for the ERC, a company needs to meet among the following requirements:.
Business operations were fully or partly suspended due to a government order related to COVID-19.
Business experienced a considerable decline in gross receipts. For 2021, a substantial decline is specified as a 20% decrease in gross invoices compared to the same quarter in 2019. For 2022 and beyond, a considerable decrease is specified as a 20% decrease in gross receipts compared to the exact same quarter in 2019, or a 20% decrease in gross invoices compared to the right away preceding quarter.
The ERC is available to organizations of all sizes, consisting of tax-exempt organizations, but there are some exceptions. Government entities and companies that received a PPP loan may have limitations on claiming the credit.
The procedure for declaring the ERC includes finishing the necessary types and including the credit on your employment tax return (usually Type 941). The exact time it takes to process the credit can vary based upon several elements, consisting of the complexity of your company and the workload of the internal revenue service. It’s suggested to consult with a tax expert for guidance particular to your situation.
There are several business that can aid with the process of declaring the ERC. These include accounting companies, tax advisory services, and payroll provider. Some well-known business that offer help with ERC claims include ADP, Paychex, Deloitte, and Ernst & Young. It’s a good idea to research and contact these business straight to inquire about their services and costs.