Defaulted SBA EIDL Loans: In Reversal, U.S. to Heighten Efforts to Collect Billions in Unpaid Covid Loans

 The Washington Post Business Edition is reporting that in a reversal of policy the U.S. Government will heighten efforts to collect $30 Billion of defaulted SBA EIDL loans by referring those loans to Treasury Direct for collection. 

This is a reversal of  SBA policy where the SBA had stated that they would not seek to collect defaulted SBA loans under $100,000.00

Clients with questions about defaulted SBA loans should contact Jim Shenwick, Esq. 917 363 3391  jshenwick@gmail.com

Please click the link to schedule a telephone call with me.

https://calendly.com/james-shenwick/15min

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com 

Please click the link to schedule a telephone call with me.

 https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!

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SBA EIDL Loan Defaults and the Statute of Limitations 12-24-2023

https://shenwick.blogspot.com/2023/12/sba-eidl-loan-defaults-and-statute-of.html

SBA EIDL Penalties if an SBA EIDL Loan is Not Repaid

https://shenwick.blogspot.com/2023/12/sba-eidl-penalties-if-sba-eidl-loan-is.html

Misuse or Misapply SBA EIDL Loan Proceeds and Chapter 7 Bankruptcy Filings

https://shenwick.blogspot.com/2023/08/misuse-or-misapply-sba-eidl-loan.html

SBA EIDL HARDSHIP PROGRAM

https://shenwick.blogspot.com/2023/07/sba-eidl-hardship-program.html

Defaulted SBA EIDL Loans, Limited Liability Company (LLC) and Cancellation of Debt Income (COD) under Section 108 of the Internal Revenue Code

https://shenwick.blogspot.com/2023/07/defaulted-sba-eidl-loans-limited.html

Offers In Compromise ("OIC") for Defaulted SBA EIDL loans and Section 108 of the Internal Revenue Code ("IRC"), Relief of Indebted Income, a Trap for the Unwary!

https://shenwick.blogspot.com/2023/05/offers-in-compromise-oic-for-defaulted.html

EIDL LOAN WORKOUTS AND BANKRUPTCY  

https://shenwick.blogspot.com/2022/07/eidl-loan-workouts-and-bankruptcy.html

EIDL Loan Default Questions & Answers

https://shenwick.blogspot.com/2022/10/eidl-loan-default-questions-answers.html

EIDL LOAN DEFAULT DOCUMENT REVIEW, WORKOUT, BANKRUPTCY FILING & OFFER IN COMPROMISE

https://shenwick.blogspot.com/2022/07/eidl-loan-default-document-review.html

EIDL Defaulted Loans

https://shenwick.blogspot.com/2022/07/eidl-defaulted-loans.html

New Relief Program for SBA EIDL Borrowers Who are Having Difficulty Repaying EIDL Loans " Hardship Accommodation Plan"

https://shenwick.blogspot.com/2023/05/new-relief-program-for-sba-eidl.html

EIDL LOANS and SBA OFFER IN COMPROMISE PROGRAM

https://shenwick.blogspot.com/2022/07/eidl-loans-and-sba-offer-in-compromise.html

PPP & EIDL Fraud

https://shenwick.blogspot.com/2022/08/ppp-eidl-fraud.html

Better to connect-What small business owners need to know about repaying loans tied to pandemic relief from the SBA EIDL Loans

https://shenwick.blogspot.com/2022/11/better-to-connect-what-small-business.html

IRS Grants Automatic Relief To Millions In Taxpayer Penalty Waivers

 IRS Grants Automatic Relief To Millions In Taxpayer Penalty Waivers

The story can be found at https://www.pelhamplus.com/finance/irs-grants-automatic-relief-to-millions-in-taxpayer-penalty-waivers/

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com 

Please click the link to schedule a telephone call with me.

 https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!

SBA EIDL Loan Defaults and the Statute of Limitations 12-24-2023

Many clients have contacted us regarding defaulted SBA EIDL loans and the period of time in which the SBA or the Government may sue them to collect on the defaulted loan (the statute of limitations). The law and rules, as noted below are complex and vary based on the facts of the case.

1. The Federal Government has 6 years to commence a lawsuit (statute of limitations) against the entity or person that obtained the EIDL loan from the SBA and defaulted.

2. The Federal Government also has 6 years to sue the guarantor of a defaulted SBA EIDL loan.

3. The 6 years runs from the date the borrower defaulted on the debt or the last time the borrower made a payment or otherwise acknowledged the debt in writing.

4. However, the Federal Government also takes the position that the statute of limitations for fraud on an SBA EIDL loan is 10 years.

5. Tax Refund Offsets - The IRS generally has 10 years to collect outstanding taxes, penalties, and interest by offsetting tax refunds. This 10-years starts  from the date the tax return was filed or the date the tax was assessed.

6. Federal Payments Offset - Federal agencies generally have 10 years to refer eligible debts to the Treasury Offset Program for administrative offset of federal payments like Social Security retirement and disability benefits. 

7. Salary Offset - Salary offset refers to withholding money from a federal employee's disposable pay to collect a debt owed to the federal government. There is generally no statute of limitations on federal salary offsets.

8. Administrative Wage Garnishment - This is garnishment of pay as a means of collecting defaulted federal debt, even for a non-government employee. There is generally no statute of limitations as long as the underlying federal debt is still valid and legally enforceable.However, only 15% of a person’s pay may be offset thru wage garnishment. 

9. This post does not discuss the statute of limitations for criminal penalties or actions by the Federal Government, which is beyond the scope of this post. 

Individuals or businesses with questions about SBA EIDL loans should contact Jim Shenwick, Esq   jshenwick@gmail.com    917 363 3391

Please click the link to schedule a telephone call with me.

https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!

Shenwick Blog Posts on SBA EIDL Loans

Many clients, attorneys, and accountants have asked where they can find our blog posts on SBA EIDL loans. To make their search easier, they are listed below. If you would like to speak with Jim Shenwick, Esq regarding your SBA EIDL loan, please click the link to schedule a telephone call with me.

https://calendly.com/james-shenwick/15min

SBA EIDL Penalties if an SBA EIDL Loan is Not Repaid

https://shenwick.blogspot.com/2023/12/sba-eidl-penalties-if-sba-eidl-loan-is.html

Misuse or Misapply SBA EIDL Loan Proceeds and Chapter 7 Bankruptcy Filings

https://shenwick.blogspot.com/2023/08/misuse-or-misapply-sba-eidl-loan.html

SBA EIDL HARDSHIP PROGRAM

https://shenwick.blogspot.com/2023/07/sba-eidl-hardship-program.html

Defaulted SBA EIDL Loans, Limited Liability Company (LLC) and Cancellation of Debt Income (COD) under Section 108 of the Internal Revenue Code

https://shenwick.blogspot.com/2023/07/defaulted-sba-eidl-loans-limited.html

Offers In Compromise ("OIC") for Defaulted SBA EIDL loans and Section 108 of the Internal Revenue Code ("IRC"), Relief of Indebted Income, a Trap for the Unwary!

https://shenwick.blogspot.com/2023/05/offers-in-compromise-oic-for-defaulted.html

EIDL LOAN WORKOUTS AND BANKRUPTCY    https://shenwick.blogspot.com/2022/07/eidl-loan-workouts-and-bankruptcy.html

EIDL Loan Default Questions & Answers

https://shenwick.blogspot.com/2022/10/eidl-loan-default-questions-answers.html

EIDL LOAN DEFAULT DOCUMENT REVIEW, WORKOUT, BANKRUPTCY FILING & OFFER IN COMPROMISE

https://shenwick.blogspot.com/2022/07/eidl-loan-default-document-review.html

EIDL Defaulted Loans

https://shenwick.blogspot.com/2022/07/eidl-defaulted-loans.html

New Relief Program for SBA EIDL Borrowers Who are Having Difficulty Repaying EIDL Loans " Hardship Accommodation Plan"

https://shenwick.blogspot.com/2023/05/new-relief-program-for-sba-eidl.html

EIDL LOANS and SBA OFFER IN COMPROMISE PROGRAM

https://shenwick.blogspot.com/2022/07/eidl-loans-and-sba-offer-in-compromise.html

PPP & EIDL Fraud

https://shenwick.blogspot.com/2022/08/ppp-eidl-fraud.html

Better to connect-What small business owners need to know about repaying loans tied to pandemic relief from the SBA EIDL Loans

https://shenwick.blogspot.com/2022/11/better-to-connect-what-small-business.html

 

IRS waiving $1B in penalties for people, firms owing back taxes — here’s who qualifies

NY Post has article discussing the IRS waiving $1 billion in penalties for certain tax years. The article can be found at https://nypost.com/2023/12/19/business/irs-waiving-1b-in-penalties-for-people-firms-owing-back-taxes-for-2020-or-2021/?utm_source=gmail&utm_campaign=android_nyp

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com 

Please click the link to schedule a telephone call with me.

https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!

Holiday debt hangover poised to be ‘particularly nasty’ this year, analyst says

The New York Post published an article stating that consumer spending through "buy now, pay later" services has increased as consumers struggle with growing debt obligations. This trend could lead to a rise in bankruptcy filings after the holidays. The article is available below. https://nypost.com/2023/12/18/business/holiday-debt-hangover-poised-to-be-particularly-nasty-this-year-analyst-says/?utm_source=gmail&utm_campaign=android_nyp

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com 

Please click the link to schedule a telephone call with me.

 https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!

SBA EIDL Collection Actions & Penalties if an SBA EIDL Loan is Not Repaid

Many readers of our blog posts and emails are aware that at Shenwick & Associates, we represent numerous borrowers who have defaulted on or not repaid their SBA EIDL loans. Many borrowers had hoped or prayed that SBA EIDL loans would be forgiven, similar to PPP grants. However, as one Boston lawyer stated, "Hope is not a legal strategy." 

Borrowers frequently inquire about the actions the government may take if they fail to repay their SBA EIDL loans. 

If payments are not received by the SBA, the agency will issue a Final Notice of Delinquency and Collection Actions. This notice states that unless you remit the full balance owed or contact the SBA Customer Service Center to discuss repayment options within 15 days from the date of the notice, the SBA may take further actions.

Those actions include:

1. Acceleration of the entire loan amount being due immediately,

2. Interest accruing at the higher default rate,

3. A lawsuit against you for the full amount owed,

4. Foreclosure against the collateral of the Borrower, as provided in the Loan Agreement and Security Agreement,

5. Garnishment of up to 15% of wages,

6. Reporting that may disqualify you from obtaining a loan/guaranty from federal agencies,

7. Reporting of your name and other information to credit bureaus, which may adversely affect your credit rating,

8. Transfer of your account to the U.S. The Department of the Treasury ("Treasury Direct") who will pursue further collection actions, including offsetting any government payments owed to you, 

9.Treasury Direct imposes a 30% penalty on the balance of monies owed to the SBA.

10. Referral to private collection agencies and the U.S. Department of Justice for litigation, 

11. The accruing of “Cancellation of Debt Income” under section 108 of Internal Revenue Code to the Borrower or the Guarantor (on loans greater than $200,000.00), which income is reported to the IRS by the SBA pursuant to a Form 1099-C

Borrowers who have defaulted or are contemplating defaulting on an SBA EIDL loan should contact Jim Shenwick, Esq., as soon as possible.

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com 

Please click the link to schedule a telephone call with me.

 https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!

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Other SBA EIDL posts by James Shenwick, Esq.

Misuse or Misapply SBA EIDL Loan Proceeds and Chapter 7 Bankruptcy Filings https://shenwick.blogspot.com/2023/08/misuse-or-misapply-sba-eidl-loan.html SBA EIDL HARDSHIP PROGRAM https://shenwick.blogspot.com/2023/07/sba-eidl-hardship-program.html Defaulted SBA EIDL Loans, Limited Liability Company (LLC) and Cancellation of Debt Income (COD) under Section 108 of the Internal Revenue Code https://shenwick.blogspot.com/2023/07/defaulted-sba-eidl-loans-limited.html Offers In Compromise ("OIC") for Defaulted SBA EIDL loans and Section 108 of the Internal Revenue Code ("IRC"), Relief of Indebted Income, a Trap for the Unwary! https://shenwick.blogspot.com/2023/05/offers-in-compromise-oic-for-defaulted.html EIDL LOAN WORKOUTS AND BANKRUPTCY

https://shenwick.blogspot.com/2022/07/eidl-loan-workouts-and-bankruptcy.html EIDL Loan Default Questions & Answers https://shenwick.blogspot.com/2022/10/eidl-loan-default-questions-answers.html EIDL LOAN DEFAULT DOCUMENT REVIEW, WORKOUT, BANKRUPTCY FILING & OFFER IN COMPROMISE https://shenwick.blogspot.com/2022/07/eidl-loan-default-document-review.html EIDL Defaulted Loans https://shenwick.blogspot.com/2022/07/eidl-defaulted-loans.html New Relief Program for SBA EIDL Borrowers Who are Having Difficulty Repaying EIDL Loans " Hardship Accommodation Plan" https://shenwick.blogspot.com/2023/05/new-relief-program-for-sba-eidl.html

We Can’t Stop Writing Paper Checks. Thieves Love That

 Be careful when write checks to pay bills due to fraud! See the New York Times article at https://www.nytimes.com/2023/12/09/business/check-fraud.html?smid=nytcore-android-share 

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com 

Please click the link to schedule a telephone call with me.

 https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!

What is the means test in bankruptcy?

What is the means test in bankruptcy? Business Insider (see link below) has a very helpful article on the Means Test in personal Bankruptcy filings.

 https://www.businessinsider.com/personal-finance/what-is-bankruptcy-means-test

In our experience, having filed approximately 1,000 Bankruptcy Petitions for individuals and businesses, the Median Income and Means Test is especially important for higher income Debtors. 

Individuals with questions about the Median Income or Means Test should contact Jim Shenwick, Esq

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com

Please click the link to schedule a telephone call with me.

https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!

Fraud Investigations into COVID-Era PPP and EIDL Loans Increasing

 Fraud Investigations into COVID-Era PPP and EIDL Loans Increasing. JD Supra (link below) has an article stating that fraud investigations into PPP and EIDL loans from the SBA are increasing. https://www.jdsupra.com/legalnews/fraud-investigations-into-covid-era-ppp-3571111/

Based on telephone calls to our law offices, we believe that that statement is correct. Clients who are contacted by the Department of Justice regarding PPP or EIDL fraud should contact and retain experienced criminal counsel as soon as possible.

We at Shenwick & Associates are only representing clients with Defaulted SBA loans. 

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com 

Please click the link to schedule a telephone call with me.

https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!

Some who took out parent PLUS loans to send their kids to college expect to die with debt

Some who took out parent PLUS loans to send their kids to college expect to die with debt.

USA Today has an article about Parent Plus Loans and parents who took them out.

The article can be found at https://www.usatoday.com/story/news/education/2023/12/03/parents-struggle-student-loan-debt/71680559007/

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com 

Please click the link to schedule a telephone call with me.

 https://calendly.com/james-shenwick/15min

We held individuals & businesses with too much debt!