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Showing posts from August, 2020

Dealing With Some of the Bitter Details of PPP Loans

When the Paycheck Protection Program ( PPP ) was first announced, many saw it as the answer to their COVID-19 related business issues. There was a rush to get applications in, especially when it was revealed that these loans may not have to be paid back if certain requirements were met. Now, as the dust begins to settle, we are getting a better idea about who makes these decisions. The Small Business Administration ( SBA ) has a great deal of discretion over how a PPP loan will be paid back. They decide if the loan can be forgiven or how much will be paid back. In addition, there is currently little guidance on how to appeal their written final decisions. The only SBA decisions that can be appealed are if the borrower was determined ineligible for a PPP loan, for the loan amount received, if the loan amount was used for ineligible purposes, or if the borrower was ineligible for full or partial loan forgiveness. This process is handled by a special SBA office. They will not rev

Dirty Dozen 2020: Senior Fraud

      As senior citizens become more familiar and comfortable using technology, this group becomes a prime target for criminals. The Internal Revenue Service ( IRS ) strongly cautions seniors and those who care for them to be careful. Senior fraud has earned a place on the Dirty Dozen list for 2020 because this group is the most likely to be targeted for fraud.      This year phishing scams related to COVID-19 are being used to a great extent. There is an endless surge of emails, texts, fake websites, and social media messages all being used in an attempt to gain personal information. The tactics of these criminals change, but their basic goal remains the same. However, evidence shows that when there is someone who takes an active role in caring for the professional needs of an elderly friend or relative, the risk of fraud goes down. Let’s take time to watch out and care for each other especially during these challenging times. 

How the US Postal Service and the Internal Revenue Service are Related

There is much discussion at this time regarding the United States Postal Service ( USPS ) and how its capacity does not meet certain needs. This particular government agency touches almost all areas of life and it is the essential communication lifeline for the Internal Revenue Service ( IRS ). Many of our posts have been dedicated to helping Taxpayers understand how to identify and avoid tax related fraud. One constant truth is that the IRS only sends official communication through the USPS system. It is through these letters that Taxpayers will find out if they have tax responsibilities to care for and how to do so. There are also some who still file their tax returns on paper, through the mail. Many care for these things online, but for those who do not, a slow postal system wreaks havoc with IRS communication. If someone is sending a payment to the IRS , they will consider the postmark on the envelope as the date it was received. However a slower mail system will keep the c

Dirty Dozen 2020: Fake Charities

       People want to help each other. This is the fundamental feeling that criminals want to exploit whenever there is a disaster. The COVID-19 pandemic is no different. Scam artists will set up fake charities, often with names very similar to legitimate ones, to accept money from unwitting Taxpayers telling them it will be a tax write off. The rise of these schemes this year has led Fake Charities to earn a place on the Internal Revenue Service ( IRS ) Dirty Dozen list.      One sign that you might be dealing with a fake charity is if you receive an unexpected text, phone call, or social media message. These links will lead Taxpayers to fake websites designed to trick visitors into giving up their personal information. Some might even claim that they are working with the IRS . If the name of this organization is similar to, but not the same, as one that is nationally known, you should be wary. This is often a clue that they are fake. A true organization with non-profit status ca

Dirty Dozen 2020: Offer in Compromise Mills

     The Dirty Dozen is a list that the Internal Revenue Service ( IRS ) publishes every year of the most common tax schemes and crimes that Taxpayers should be on the watch for. They peak during Tax Season, but are seen throughout the entire year. One entry on this year’s list has to do with debt resolution companies that heavily promote the Offer in Compromise ( OIC ) program. The fact that they advertise this program with very strict standards as something that can help anyone with tax problems is deceptive and therefore earns a place on the Dirty Dozen list.      These companies will send OIC applications to the IRS . The advertisements will play to hearts of distressed who owe large debts, telling them that they will pay “pennies on the dollar”. The OIC program does allow those who are accepted to pay a compromised amount to the IRS . However, the IRS has many other payment programs that have a much higher likelihood of getting approval for. In one recent year, there were

Dirty Dozen 2020: Ransomware

           A growing threat today involves cybercrime. One example of this is Ransomware. This is software designed for an evil purpose. It will target human or technical weaknesses in a computer, network, or server. Most of the time, people are not even aware of downloading it. This relates to our recent Phishing blogpost .           Once inside, the Ransomware will track activity to lock and encrypt critical files. Then a demand message will appear. It will usually have payment details and contain the threat of the losing the data, or making it public. They may even be able to impact the entire computer network. To avoid this situation be careful about the links and attachments you open. There are many fake COVID-19 charities being promoted. This is a particular concern for Tax Professionals because they deal with the personal information of many individuals. The Internal Revenue Service ( IRS ) has guidelines meant to protect Taxpayers from this item on the Dirty Dozen list. As

Dirty Dozen 2020: Economic Impact Payment Theft

          Identity Theft continues to be a problem. In previous years, a fraudulent tax return would be filed with the Internal Revenue Service ( IRS ) to steal a tax refund. This type of scam goes on every year. Now there is a new variation related to COVID-19 relief that has been provided.           Criminals are doing their best to steal Economic Impact Payments ( EIP ) being sent to Taxpayers. Remember that there is no fee to receive these funds. Do not pay anyone to find out when you will receive your payment. Never sign over your check to someone. If your identity has been stolen, make sure to let the IRS know and make sure they have your correct address and bank information.           The IRS has recently warned a number of care facilities and nursing homes that these EIP funds belong to the residents and not the business providing their care. These payments do not count as income and are not to be used for determining eligibility for any aid programs. The times we live

Dirty Dozen 2020: Phishing

     The use of deceptive tactics, including fake emails, text messages, links, and websites, to gain personal information is called phishing. New phishing scams using pandemic related terms is one of the fastest growing scams according to the Internal Revenue Service ( IRS ). Remember that the IRS will never contact Taxpayers using Social Media or text message, and will never initiate contact through email.      Many are anxious and seeking the latest news about how the COVID-19 pandemic will impact them, their business, and other financial matters. These new phishing schemes use terms like “coronavirus” and “stimulus” to draw in Taxpayers looking for answers to their questions. Please remember that the official term is Economic Impact Payment. Do not open strange emails, click on links, or open attachments from people you don’t know or that are unexpected. Criminals feel that everyone is a target and this is one of their tools.