U.S. Seeks to Collect on Up to $20 Billion in Delinquent Covid Loans
The SBA announced that delinquent Covid EIDL loans with balances of $100,000 or less will be sent to the Treasury Department for collection.
The referral is sent to Treasury Direct, which can seize government benefits such as portions of Social Security payments and tax refunds.
Additionally, in our experience Treasury Direct can and will assess a 30% penalty on the unpaid balance of defaulted SBA EIDL loans (a point not covered in the article).
Moreover, borrowers who default may have to recognize Cancellation of Debt income, which is ordinary income under section 108 of the Internal Revenue Code (another point not covered in the article).
Many small businesses never intended to repay the loans, hoping they would be forgiven like PPP loans; however, this is not the case.
Borrowers with questions about defaulted SBA EIDL loans should contact Jim Shenwick, Esq. Jim has an LLM in Taxation from NYU law school and he is familiar with the Cancellation of Debt tax issues.
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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Jim Shenwick, Esq Blog SBA EIDL Posts:
SBA EIDL Loan Charge Offs
https://shenwick.blogspot.com/2024/02/sba-eidl-loan-charge-offs.html
SBA EIDL LOANS & CIVIL & CRIMINAL PENALTIES & BANKRUPTCY FILINGS
https://shenwick.blogspot.com/2024/01/sba-eidl-loans-civil-criminal-penalties.html
Defaulted SBA EIDL Loans: In Reversal, U.S. to Heighten Efforts to Collect Billions in Unpaid Covid Loans
https://shenwick.blogspot.com/2023/12/defaulted-sba-eidl-loans-in-reversal-us.html
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
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