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Tax Resolution Times


May 15, 2020

Protecting YOUR Income and Assets since 1991

Patrick T. Sheehan, Esq.
Former IRS Attorney
President of IRS Trouble Solvers 
®
 

In this issue:
IRS Enforced Collection Action
Changes to Estimated Payments
IRS Looking for Covid Scammers

Thank you Essential Workers
Did you Know?
Tax Humor
Thank you for your referral
Client of the Month

Did You Know?


Dr. Walton Lillehei, known as the father of open-heart surgery, was convicted of five counts of tax evasion in 1973. Among other imaginative deductions he claimed a $100 payment to a prostitute as a charitable contribution.
 

Tax Humor


“I am proud to be paying taxes in the United States. The only thing is, I could be just as proud for half the money.”
                           Arthur Godfrey

Important Information - IRS Enforced Collection Action post Covid19


The IRS has been partially shut down for over a month but has slowly begun to reopen.  They aim to be fully operational by July 15, 2020.  Because of all of the stimulus money being doled out, and because the IRS will now have most every American’s bank account number, I expect that the IRS will be taking enforced collection action against taxpayers like never seen before to collect back taxes.  I also expect the IRS to be equally overwhelmed with people seeking some type of relief in terms of the processing of unfiled tax returns and requests for some sort of tax resolution.  Call us today for your complimentary consultation at 630-832-6500.

Changes to Estimated Payment Requirements due to COVID-19 Virus Outbreak 

Due to COVID-19 emergency related extension of filing and payment deadline for Illinois income tax returns due April 15, 2020, to July 15, 2020, a significant number of taxpayers may not be able to accurately calculate and pay their 2020 Illinois estimated income tax. The Illinois Department of Revenue (department) issued guidance to help individuals and businesses understand the impact of the extension on estimated tax payments.

Estimated Payment Allowances

Since taxpayers may not know their prior year’s tax liability if they do not file by the original due date, the IDR provides for an additional option upon which taxpayers can base their 2020 estimated tax payments. For 2020, estimated tax payments can be based upon either:

  • 100 percent of their estimated liability for the year 2020;

  • 100 percent of their actual liability for year 2019; or

  • 100 percent of their actual liability for year 2018.

If taxpayers timely pay in four equal installments, the lesser of 90 percent of their liability for the year 2020 or 100 percent of their liability for the years 2019 or 2018, they can avoid estimated late payment penalties.

Beware of Scammers on the Hunt  For COVID-19 Stimulus Checks

The IRS is urging citizens to be on high alert for scams related to the COVID-19 economic impact payments. While more than 80 million taxpayers who opted for direct deposit should have already received the payment, millions more will receive the stimulus via a check in the mail.
 
US Attorneys around the country expect these payments to coincide with a surge in scam calls, emails and text messages as criminals attempt to leverage the payout as an opportunity to defraud individuals. Particularly vulnerable are seniors and the disabled, who don’t normally file tax returns and whose stimulus payment will be sent automatically with no further action required to receive it.
 
"Our office is on the lookout for scam artists who try to steal these much-needed economic impact payments from the pockets of our citizens," said U.S. Attorney Michael Bailey. “Educate yourself about common scams, be vigilant in protecting your information, and report any attempted fraud."
 
The IRS will not contact anyone to request additional information via email, text, call, or in-person to issue an economic impact payment. Any contact asking for information regarding an economic impact payment should be considered suspicious. If contacted, the IRS recommends people hang up the phone, ignore the email, or shut the door, and report the scam to the IRS or the National Center for Disaster Fraud hotline at 1-866-720-5721 or email at disaster@leo.gov.
Changes to Estimated Payment, cont. 

Who Is Required to Pay Estimated Tax?

Individuals are required to make estimated payments if their Illinois individual income tax liability exceeds $1,000 for the year.  Businesses are required to make estimated payments if they are a corporation and they reasonably expect their Illinois Income and Replacement tax and surcharge liability to be more than $400 for the tax year.
 

Thank You for Your Referral


Thanks to YOU, the word is spreading. Thanks to my clients and friends who graciously referred me to their friends, clients and relatives last month! I enjoy building my business based on the positive comments and referrals from people just like you. I just couldn’t do it without you!

This month I would like to thank Elizabeth for her kind referral. Elizabeth is a former client whom we were able to secure a very positive outcome for her case, and she sent a referral our way. Thank You Elizabeth!

 

Client of the Month


Each month I like to highlight a client who has trusted me to help resolve their IRS problems. This month, I would like to thank my client Stan, who came to us facing an IRS audit. He had a short amount of time, and needed to get a plan in place and prepare a quick response for the IRS.  As we worked his case, he reached out to the office to say thank you. "I just wanted to take a moment to thank the entire team for your professionalism and candor. This is an extraordinarily difficult time for me for several reasons and I greatly appreciate all your efforts. The silver lining in all of this is that one day, when this episode is hopefully behind me, I have found a great team to help me get and keep my financial affairs in order."  We are pleased we able to provide Stan some peace of mind.  
 

Nothing Smart About This Tax Offender


Two tax preparers in Texas, Smart Ajayi and JoAnn Villarreal, were charged with filing fraudulent tax returns and have been permanently barred from operating a tax return preparation business and preparing tax returns for others.
 
The complaint against  Ajayi and Villareal states that they repeatedly understated their customers’ tax liabilities by making up non-cash charitable deductions and creating false Schedules C with inflated or fraudulent business losses. In one instance, Ajayi falsely reported that a customer with an adjusted gross income of $34,027 made $19,759 in non-cash charitable contributions. From 2016 to 2018, Ajayi and Villareal filed hundreds of tax returns, causing the US to lose substantial tax revenue.

 

Thank you!
 

IRS Trouble Solvers thanks those essential workers who are going to work every day to keep us safe. We appreciate you!
 

Read about IRS cases I’ve solved on my website: www.IRSTroubleSolvers.com

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2019 Patrick T. Sheehan & Associates, d/b/a IRS Trouble Solvers®
All rights reserved.
Our mailing address is:
314 N. York Rd.
Elmhurst, IL 60126
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