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$1.4B in stimulus checks sent to dead people, report shows

Government Accountability Office shows IRS didn’t check death records
$1.4B in stimulus checks sent to dead people, report shows
Posted at 2:23 PM, Jun 25, 2020
and last updated 2020-06-25 14:23:29-04

A new report from the Government Accountability Office released Thursday criticizes the federal government for sending out $1.4 billion in stimulus payments to dead people.

The independent watchdog report says the Treasury and IRS sent almost 1.1 million payments totaling nearly $1.4 billion to deceased individuals around the country.

“IRS announced that if a payment was issued to a deceased or incarcerated individual, the total amount should be returned,” read the report. “However, the IRS does not currently plan to take additional steps to notify ineligible recipients on how to return payments.”

The GAO is an independent investigative agency that reports its findings to Congress

The agency found that the IRS failed to access death records maintained by the Social Security Administration before sending out the payments.

“Typically, IRS uses third-party data, such as the death records maintained by the SSA to detect and prevent erroneous and fraudulent tax refund claims,” read the report. “However, Treasury and IRS did not use the death records to stop payments to deceased individuals for the first three batches of payments because of the legal interpretation under which IRS was operating.”

J. Tilden, who lives near Indianapolis, was surprised when he got a $1,200 paper check in the mail for his mother, Lillian. Lillian’s death certificate shows she died on Jan. 12, 2018 at the age of 73.

"So I was surprised and immediately thought about how this was potentially something that was a fraud," Tilden said. "I just thought this is crazy. I can't believe I am getting a check for this particular situation when she's been dead and gone for two years."

Tilden is not alone.

"I posted it to Facebook and actually had several people tell me that they knew others who had been in the same situations,” Tilden said. “So I'm thinking this is a problem, not a one-off situation."

Anyone who gets a check for someone who died should return the check to the IRS, and write “void” in the endorsement section on the back of the check.

“Payment made to someone who died before receipt of the Payment should be returned to the IRS by following the instructions in the Q&A about repayments,” reads the IRS website. “Return the entire Payment unless the Payment was made to joint filers and one spouse had not died before receipt of the Payment, in which case, you only need to return the portion of the Payment made on account of the decedent. This amount will be $1,200 unless adjusted gross income exceeded $150,000.”

The IRS says if the payment was a paper check:

  • Write "Void" in the endorsement section on the back of the check.
  • Mail the voided Treasury check immediately to the appropriate IRS location.
  • Don't staple, bend, or paper clip the check.
  • Include a note stating the reason for returning the check.

The IRS says if the payment was a paper check and you have cashed it, or if the payment was a direct deposit:

  • Include a brief explanation of the reason for returning the EIP.
  • Write on the check/money order made payable to “U.S. Treasury” and write 2020EIP and the taxpayer identification number (social security number, or individual taxpayer identification number) of the recipient of the check.
  • Include a brief explanation of the reason for returning the EIP.

This story was originally reported by Kara Kenney on theindychannel.com.