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ASK THE CALIFORNIA EMPLOYMENT TAX AND PAYROLL TAX ATTORNEY – NEW EDD AND IRS POLICIES IN LIGHT OF COVID-19

By Robert S. Schriebman

2020

Introduction

The EDD and the IRS have recently initiated policies for the filing of returns, the payment of taxes, and enforced collection activities.

In this article I will briefly outline the new EDD and IRS policies that will impact your ability to pay your taxes. If you owe the IRS, new policies have been put in place to hold off on making installment payments and the filing of liens and levies.

New EDD Policy for the Filing of Quarterly Returns and the Payment of Payroll Taxes.

The EDD has initiated a policy of granting a 60-day extension for the filing of the first quarter 2020 payroll tax returns and the payment of payroll taxes. In order to take advantage of this relief, an employer must make a written request to Sacramento for relief and this request must be made on or before April 30, 2020. If you wait beyond April 30th to make your request, you may not be granted relief. There are also toll-fee numbers on the EDD’s website that you can call if you have any questions or concerns. (For English -1-888-745-3886)

IRS People First Initiatives for COVID-19 Relief

On March 25, 2020 the IRS issued IR-2020-59 providing for relief from the payment of taxes, the filing of returns, and enforced collection activities. Let’s take a brief look at them:

  • Existing Installment Agreements: If you are making payments pursuant to an existing installment agreement, you do not have to make any further payments until after July 15, 2020. Your installment agreement will not be defaulted. This new policy, however, does not preclude an IRS Revenue Officer or CDP Settlement Officer from establishing or modifying an installment agreement. Most likely, any new agreements will have payments commencing after July 15, 2020. If you elect not to make installment payments until after July 15, 2020, be advised that interest continues to accrued on any unpaid balance
  • Offers in Compromise: The IRS will allow taxpayers until July 15, 2020 to provide additional documentation and information necessary to complete the OIC process. Taxpayers will have the option of not making OIC payments until July 15, 2020.
  • Non-Filers: Commissioner Rettig reminds taxpayers to file any unfiled returns to secure tax refunds. More than 1 million households that haven’t filed tax returns for the last three years, may be entitled to refunds which may evaporate if these returns are not filed. If you miss getting your refund because you haven’t filed returns, you will not be given any credit for monies the Treasury is holding for you.
  • Enforced Collection Action: The IRS will be holding off on enforced collection action up until July 15, 2020. This means that liens, levies, and seizures will be suspended during this period. This includes the seizure and sale of a personal residence. The exception will be high-income non-filers. Computer-generated automatic liens and levies will also be suspended during this period.
  • Passport Certification to the State Department: If you owe the IRS a substantial amount of money, the IRS may notify the State Department to prevent the issuance of a new passport or the renewal of an existing passport. The IRS will suspend notifications until July 15, 2020.

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Robert Schriebman has a successful practice in the Rolling Hills Estates area of Los Angeles County serving clients throughout California and the United States. He has successfully dedicated more than 40 years to helping individual taxpayers, business owners, CPAs, Enrolled Agents, and tax attorneys navigate the complicated tax systems of the federal and state governments. Mr. Schriebman is in private practice. He is not affiliated in any way with the EDD and he is not employed by the EDD or any other agency of the State of California.

Robert Schriebman has written the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See “California Tax Collection Practice and Procedures” and “California Taxation Practice and Procedure,” both published by Commerce Clearing House.

Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, “IRS Tax Collection Procedures – A Manual for Practitioners” published by Commerce Clearing House.

Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, “IRS Tax Collection Procedures – A Manual for Practitioners” published by Commerce Clearing House in addition to the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See “California Tax Collection Practice and Procedures” and “California Taxation Practice and Procedure,” both published by Commerce Clearing House.

Web Site Article 445