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Dead people may still get $600 stimulus checks


#Igor #Golovniov/SOPA #Images/LightRocket via #Getty #Images

#Dead people may get some of the $600 stimulus checks the federal government began issuing #Tuesday night.

#That would mirror what happened this past spring, when deceased individuals were among the recipients of a prior round of direct payments, of up to $1,200 per person.

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#More than 1 million decedents had gotten a check by the end of #April, worth a collective $1.4 billion, according to the #Government #Accountability #Office. The IRS asked for that money back, leading to confusion and whiplash for heirs such as surviving spouses and family members.

#More from #Personal #Finance:
#If stimulus checks are raised to $2,000, here’s how that would work
#Millions of #Americans likely won’t lose a week of jobless benefits
#Mom-and-pop businesses that took PPP loans may face a tax bomb

#Now, a $900 billion #Covid relief package, which #President #Donald #Trump signed into law #Sunday, may create a similar situation, though #Congress put a firewall in place to limit its scope, according to tax experts.

The IRS and #Treasury #Department didn’t return a request for comment.

The law, the #Coronavirus #Response and #Relief #Supplemental #Appropriations #Act of 2021, provides a one-time payment of up to $600 per person and $600 per dependent child. A family of four, for example, could get up to $2,400.

#New firewall

#Tom #Williams | CQ-Roll #Call, #Inc. | #Getty #Images

#But the measure doesn’t allow people who died before #Jan. 1, 2020 to receive a payment.

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#This safeguard is new, according to #Janet #Holtzblatt, a senior fellow at the #Urban-Brookings #Tax #Policy #Center and a former #Treasury official. The CARES #Act was silent on the point of payments to deceased individuals, she said — an omission that led to people who filed 2018 and 2019 tax returns, but subsequently died, to be issued checks.

“#Now, they explicitly dealt with the issue of deceased persons,” #Holtzblatt said of the new law. “[But] it’s silent on those who died in 2020.”

#That means people who died this year should be getting a $600 check, if they’re eligible for one, according to #Nina #Olson, executive director of the #Center for #Taxpayer #Rights, a nonprofit advocacy group.

#It’s silent on those who died in 2020.

#Janet #Holtzblatt

senior fellow at the #Urban-Brookings #Tax #Policy #Center

#This year is poised to be the deadliest in U.S. history, with deaths expected to top 3 million (including non-Covid cases) for the first time.

#It’s also possible that someone who died in 2019 may receive a stimulus check, if up-to-date information from tax forms, the #Social #Security #Administration or other databases isn’t readily available to the IRS at the time a $600 check is issued, #Olson said.

#In those cases, the agency won’t know someone is dead when paying them.

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“#Mistakes are going to happen,” #Olson said. “#But they’ll be few and far between.”

The maximum stimulus payment will initially go to those who made $75,000 or less in 2019, per last year’s tax return.

#Return the money?

The IRS knowingly paid $1,200 to dead people via the earlier round of payments in the spring, according to a #Government #Accountability report published in #June.

The agency was following its procedure during the #Great #Recession, when the government also issued stimulus checks to deceased #Americans, the report said.

The tax agency, along with the #Treasury #Department, subsequently determined those payments to be improper, the GAO said. #On #May 6, the IRS asked heirs to return the money. (The same was asked of incarcerated individuals.)

#But, like last time, the IRS doesn’t have much legal recourse to force people to repay $600 stimulus checks if ultimately deemed to have been issued in error, #Olson said.

The agency could ask the #Department of #Justice to bring a lawsuit against an heir or estate that doesn’t refund a stimulus payment, but that’s unlikely, #Olson said.

“They bring so few of them in normal circumstances,” she said of the #Justice #Department.



[ source link ]
https://www.cnbc.com/2020/12/30/dead-people-may-still-get-600-stimulus-checks.html

##Dead #people #stimulus #checks

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