Douglas Sacha | Moment | Getty Images
Nearly 60,000 stimulus checks sent to the deceased were voluntarily returned, according to a Treasury Department report on Thursday. The funds returned totaled $ 72 million.
The $ 1,200 economic impact payments were made to households under the CARES Act pandemic relief passed in March 2020. The IRS was writing approximately 168 million checks at year-end, valued at $ 280 billion.
However, the federal government has made nearly 4.5 million payments to people who may not be eligible for the aid, according to the financial report.
More from Personal Finance:
The new round of stimulus checks, valued at $ 1,400, brings a total of around $ 391 billion
Make your expenses inflation-proof by avoiding these purchases
SEC is considering new investor protection for SPACs
About half of those payments, which totaled $ 5.5 billion, went to the deceased, according to the Treasury Department, which analyzed the data through mid-July. The remainder was given to loved ones, non-residents, and anyone else who was mistakenly received double payments.
About 59,500 of those $ 72 million worth of payments to the deceased had been voluntarily repaid by October 1, according to the report.
They make up the vast majority of the total of 65,447 stimulus checks (valued at $ 80 million) that Americans have returned to the federal government.
The CARES act was based on eligibility for tax returns for 2018 or 2019, whichever was most recently available to the IRS. But Americans may have died after those tax returns were filed – especially as the coronavirus pandemic spread across the United States
The federal government tracked the process during the Great Recession when it also issued stimulus checks for deceased Americans, according to a report by the Government Accountability Office.
The IRS then reversed course and asked individuals to send the money back.
In addition to the funds voluntarily returned, an additional 668,277 payments totaling more than $ 872 million have been declined by banks or returned to the IRS as undeliverable.
According to Kenneth Corbin, commissioner for the agency’s payroll and investment division, the IRS correctly calculated and sent stimulus checks 98% of the time. (This statistic was verified by the Treasury report.)
“Within 10 days of [CARES ACT] Going into effect, the IRS … spent around 81 million [Economic Impact Payments] A total of $ 147 billion, “Corbin wrote in a response to the report.” This response was unprecedented compared to the nearly two months it took to issue stimulus payments in 2008. “
The report also increases the number of improper payments, he said.
For example, the report claims that nearly 1.1 million payments have been made to dependents who should be ineligible due to their age over 16. However, they weren’t older than 16 during the tax year the payments were based on, Corbin said.
Two additional rounds of stimulus checks – for $ 600 and $ 1,400 – were sent out under other pandemic control laws.
A $ 900 billion bill in December sought to reduce the number of checks sent to the deceased by refusing to pay to people who died before January 1, 2020.