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Tax Resolution Times

June 1, 2020

Protecting YOUR Income and Assets since 1991

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

In this issue:
SBA Publishes PPP Loan Forgiveness Application
Electronic Filing of Form 1040-X Coming Soon
Tax Question of the Month
A Prime Example
We Can Help!

Electronic Filing of Form 1040-X coming soon

The Internal Revenue Service has announced that, later this summer, taxpayers will for the first time be able to file their Form 1040-X, Amended U.S Individual Income Tax Return, electronically using available tax software products.

Currently, taxpayers must mail a completed Form 1040-X to the IRS for processing. The new electronic option allows the IRS to receive amended returns faster while minimizing errors normally associated with manually completing the form.

When the electronic filing option becomes available, only tax year 2019 Forms 1040 and 1040-SR returns can be amended electronically.  Additional enhancements are planned for the future.

SBA Publishes PPP Loan Forgiveness Application

Recently, the SBA published the Paycheck Protection Program Loan Forgiveness Application (SBA Form 3508). While the application clears up some of the many questions that borrowers may have with regards to forgiveness eligibility, there are still some questions left unaddressed. Here are a few explanations for terms that are used in that document, which might be helpful if you are working on your forgiveness forms.

 Alternative payroll covered period
For borrowers with payroll schedules that are biweekly or more frequent, the application allows them to choose an eight-week (56-day) period that begins on the first day of the first pay period that begins after disbursement of PPP funds (the “alternative payroll covered period”).  However, if a borrower chooses an alternative payroll covered period, they must apply this pay period to wherever there is a reference to “the covered period or the alternative payroll covered period” but must use the covered period where only the covered period is referenced.

Payroll costs (paid versus incurred)
The application states that “borrowers are generally eligible for the payroll costs paid and payroll costs incurred ”during the appropriate period. Based on this language, it appears that the SBA will be allowing both payroll paid in the appropriate period for work performed just prior to the covered period and for payroll accrued within the eight weeks, even if paid after the covered period, provided that proof of payment is submitted.

Non-payroll costs (paid versus incurred)
The allowable non-payroll costs do not seem as clear as the payroll costs, but it can be read in a similar manner. The application states, “An eligible non-payroll cost must be paid during the covered period or incurred during the covered period and paid on or before the next regular billing cycle.” This means that borrowers may be forgiven for more than the eight weeks of payroll originally anticipated, although individuals will still be capped at $15,385 based on an annualized $100,000.

Businesses will need to work with their financial, accounting or consulting specialists to make sure they are able to maximize forgiveness. Check the SBA website regularly for additional updates on this program.

Have Tax Problems? We Can Help!

IRS Trouble Solvers offers complimentary tax debt strategy sessions for individuals and businesses facing IRS problems. You do not have to face them alone! Call us today at 877 4 IRS LAW to schedule your appointment today.

A Prime Example of What Not to Do

Igor Fleyshmakher, co-owner of Prime Aid Pharmacy in New York and New Jersey, pled guilty to tax evasion and violation of the federal anti-kickback statute in a scheme that included bribing doctors and their staff to direct prescriptions to his pharmacies. Bribes included designer bags, expensive meals, and payments by cash, check and wire transfers.
Between 2012 and 2014 Fleyshmakher diverted $33.9 million into a bank account concealed from pharmacy tax preparers and did not report the funds on his personal tax return. This resulted in a 5.8-million-dollar tax loss to the IRS.
“Bribing doctors to line your own pockets and using secret accounts to evade taxes are both very serious offenses, motivated by one thing: greed,” said John Tafur, Special Agent in Charge.
The conspiracy and tax evasion charges each carry a maximum penalty of five years in prison and a fine of up to $250,000.00.

Question: I have a huge tax amount owed to the IRS and they are harassing me and I need help.  I got a quote from a national firm which seems extraordinarily low.  Why should I go with you?

Answer:  If someone quoted you a bargain basement fee, think about this: do you think an experienced tax resolution CPA, EA or attorney worth their “salt” would work for peanuts?  IRS representation is a highly valued skill set and  most often you get what you pay for.

This is your financial life and the stakes are very high. If you needed heart surgery, would you shop around for the least expensive surgeon or would you get the very best you can find? The same holds true for dealing with the Internal Revenue Service. Having IRS problems can ruin all aspects of your life - your marriage, relationships with your children and family members, your employment, ability to buy a house, a car, money for retirement or to even have a bank account.  You want the best possible person for the job, not the cheapest. 

Your IRS debt doubles every 6-8 years due to the daily compounding effect of interest and penalties and the IRS has at least 10 years to collect from you. Knowing this, handing this off to the lowest bidder in town or across the country is probably not a wise decision.  You’ll have peace of mind and sleep better at night knowing that we’re working hard on your case to get you the lowest possible settlement, allowed by law, with the IRS!

We at IRS Trouble Solvers are experts in tax problem resolution and help taxpayers like you with their IRS Problems every day.  Call us today at 877 4 IRS LAW for your free, no obligation tax debt strategy session.

Read about IRS cases I’ve solved on my website:

2020 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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