Law Office of Camron Hoorfar, PC

Luckin Coffee Inc. reached a $175 million settlement of shareholder class-action claims that the Chinese rival to Starbucks fraudulently inflated its share price by falsifying revenue, Reuters reported. Lawyers for the shareholders called the all-cash settlement, filed on Monday night, an “excellent result,” citing Luckin’s liquidation proceeding in the Cayman Islands and its related filing for protection under the U.S. Bankruptcy Code. The accord also covers Luckin officials, as well as underwriters of the Xiamen, China-based company’s $645 million initial public offering in 2019 and a later offering of American depositary shares. U.S. District Judge John Cronan in Manhattan approved the preliminary settlement on Tuesday and scheduled a Jan. 31, 2022, hearing to consider final approval.

The settlement also requires approval by a Cayman Islands court. Founded in 2017, Luckin ended March with about 5,000 stores. Shareholders sued Luckin in February 2020, two weeks after short-seller Muddy Waters Research accused it of inflating revenue. Two months later, Luckin’s share price sank 81% after the company said an internal probe found that its chief operating officer and other staff fabricated about $310 million of sales in 2019, or about 40% of annual sales projected by analysts. Luckin agreed last December to pay a $180 million fine to settle U.S. Securities and Exchange Commission accounting fraud civil charges.

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The Internal Revenue Service recently sent approximately 430,000 refunds totaling more than $510 million to taxpayers who paid taxes on unemployment compensation excluded from income for tax year 2020.

The IRS efforts to correct unemployment compensation overpayments will help most of the affected taxpayers avoid filing an amended tax return. So far, the IRS has identified over 16 million taxpayers who may be eligible for the adjustment. Some will receive refunds, while others will have the overpayment applied to taxes due or other debts.

The American Rescue Plan Act (ARPA) of 2021, enacted in March, excluded the first $10,200 in unemployment compensation per taxpayer paid in 2020. The $10,200 is the amount excluded when calculating one’s adjusted gross income (AGI); it is not the amount of refund. The exclusion applied to individuals and married couples whose modified adjusted gross income was less than $150,000.

Earlier this year, the IRS began its review of tax returns filed prior to the enactment of ARPA to identify the excludible unemployment compensation. To date, the IRS has issued over 11.7 million refunds totaling $14.4 billion. This latest batch of corrections affected over 519,000 returns, with 430,000 taxpayers receiving refunds averaging about $1,189.

The review of returns and processing corrections is nearly complete as the IRS already reviewed the simplest returns and is now concentrating on more complex returns. The IRS plans to issue another batch of corrections before the end of the year.

Impacted taxpayers will generally receive letters from the IRS within 30 days of the adjustment, informing them of what kind of adjustment was made (refund, payment of IRS debt payment or payment offset for other authorized debts) and the amount of the adjustment.

The IRS also is making corrections for Earned Income Tax Credit, Additional Child Tax Credit, American Opportunity Credit, Premium Tax Credit and Recovery Rebate Credit amounts affected by the exclusion. Most taxpayers need not take any action and there is no need to call the IRS.

The IRS will be sending notices in November and December to individuals who did not claim the Earned Income Tax Credit or the Additional Child Tax Credit but may now be eligible for them.

These notices are not confirmation that they are eligible for these credits and will require a response from the taxpayer if eligible rather than filing an amended return. For taxpayers who become eligible for other credits and/or deductions after the exclusion is calculated but not claimed on their original return, they must file a Form 1040-X, Amended U.S. Individual Income Tax Return, to claim any new benefits.

See the 2020 Unemployment Compensation Exclusion FAQs for more information, including details on filing an amended return.

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A South Georgia pastor faces decades in prison after he’s accused of stealing thousands of dollars in federal COVID-19 relief funds, some of which authorities said he used to buy a new luxury car.

A grand jury handed down a five-count indictment against Mack Devon Knight, 45, of Kingsland, according to the U.S. Attorney’s Office for the Southern District of Georgia. The indictment alleges Knight, who’s also a restaurateur and tax preparer, lied to the Small Business Administration to fraudulently obtain $149,900 in CARES Act funding.

He applied for the funds in February and March, authorities said, and falsely claimed that his businesses had raked in “hundreds of thousands of dollars of gross revenue” before the COVID-19 pandemic. Knight then sent falsified bank statements to the SBA so it would approve his loan application, according to the indictment.

After receiving the money, authorities said the pastor used some of it to purchase a Mercedes-Benz S-Class.

If convicted, Knight faces up to 30 years in prison and hefty fines.

Struggling financially? We can help. Call us at 816-524-4949 or visit our website to schedule a consultation with an attorney.

In the Netflix hit series “Squid Game,” characters gamble with their lives. Though in real life lives aren’t on the line, for many people who piled their money into Squid, a cryptocurrency named after the show, the financial loss has still been significant. On early Monday morning, the value of a Squid coin collapsed from a high of just over $2,860 to effectively zero as cryptocurrency traders watched the token’s unknown creators clean out some $3.3 million in funds, according to digital records. The maneuver, known as a “rug pull” in cryptocurrency circles, occurs when a token’s creators abandon the project by exchanging many virtual coins for real-world cash. They quickly drain liquidity from the product, effectively driving the coin’s value to zero and leaving other investors holding the bag in an apparent scam. Launched late last month, the new cryptocurrency skyrocketed in value as investors rushed to buy tokens hyped by promotions on multiple social media platforms.

Struggling financially? We can help. Call us at 816-524-4949 or visit our website to schedule a consultation.

The number of Americans applying for unemployment benefits fell to a pandemic low as the job market continues to recover from last year’s coronavirus recession. Jobless claims dropped by 10,000 to 281,000, the lowest since mid-March 2020, the Labor Department said Thursday. Since topping 900,000 in early January, weekly applications have steadily dropped, moving ever closer to pre-pandemic levels just above 200,000. The four-week average of claims, which smooths out week-to-week gyrations, fell by nearly 21,000 to 299,250, also a pandemic low. In all, 2.2 million people were collecting unemployment checks the week of Oct. 16, down from 7.7 million a year earlier. In March and April last year, employers slashed more than 22 million jobs as businesses closed or reduced hours in response to lockdowns and consumers staying home as a health precaution.​​

Have you been affected financially by the COVID-19 pandemic? Give us a call at 816-524-4949 or visit our website to schedule a consultation.