COVID-19 Stimulus Payments: IRS Is Sending Checks to Dead People

Cemetery

Getty Gravestones from Linden Hill Methodist Cemetery are seen with the Manhattan skyline in the background on April 7, 2020, in Brooklyn, NY

As millions of people across the United States anxiously wait for stimulus checks from the IRS amid COVID-19 job losses, some of those checks are being sent to dead people.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act was passed by Congress and signed into law on March 27. The economic relief package was drawn up in an effort to help small businesses, workers, and families during the pandemic, with over $2 trillion slated to be given to those who meet the criteria.

The money started going out in mid-April. While many who haven’t yet received their checks are wondering what’s taking so long, some relatives are reporting that stimulus money has been sent to their dead loved ones.

Relatives of those deceased recipients who have erroneously received checks are unclear what they are lawfully supposed to do with the stimulus money, and some politicians like Kentucky Rep. Thomas Massie expressed criticism of the way the federal government is handling the dispersion of the funds. He tweeted, “The government is in such a rush to get the small business loans & $1,200 checks out the door that many mistakes will be made, and fraud will be rampant. Sending checks to deceased Americans is just the beginning!”

Still, there is a logical explanation for why this is happening, even if it doesn’t rectify the problem. It has to do with the chain of communication.


The Money Doesn’t Come From the Same Agency That Tracks Deaths

IRS Building

GettyThe Internal Revenue Service (IRS) building in Washington, D.C.

The Internal Revenue Service is sending out the stimulus checks, but the agency that tracks deaths in America is the Social Security Administration. Even they say “It is important to note our records are not a comprehensive record of all deaths in the country,” because getting deaths recorded in the system is a process — and with nearly 3 million Americans dying in an average year, according to the CDC, it seems people can be dead for a while before the federal government gets the memo.

According to Politico, “The IRS is supposed to check death records before okaying the payments, but the government does not have real-time information on who dies. That data percolates up from the states, and there is invariably a lag in reporting.”

The IRS  initially sent out 60 million stimulus checks in mid-April, according to the House Committee on Ways and Means. Another 20 million have been sent in the second wave, The Hill reports. Yet many people are still wondering where their check is, while others seem confounded as to how the IRS could be so careless as to send money to a dead person when so many are in need right now.


It’s Not Clear What Will Happen to The Money Sent to the Dead

Stimulus Bill Signing

Getty(L-R) Treasury Secretary Steven Mnuchin, Senate Majority Leader Mitch McConnell (R-KY), House Minority Leader Kevin McCarthy (R-CA), Vice President Mike Pence and Rep. Kevin Brady (R-TX) applaud U.S. President Donald Trump during a bill signing ceremony for H.R. 748, the CARES Act in the Oval Office of the White House on March 27, 2020, in Washington, D.C. Earlier on Friday, the U.S. House of Representatives approved the $2 trillion stimulus bill that lawmakers hope will battle the economic effects of the COVID-19 pandemic.

Heavy reached out to the IRS and to the U.S. Government Accountability Office to ask what family members should do with the money mistakenly sent to the dead. The GAO replied saying, “We are aware of instances of stimulus payments going to deceased individuals and will be looking at that as part of our work. Treasury’s Inspector General for Tax Administration is monitoring the payments as well.  IRS has been updating its website with information for taxpayers concerning these payments as issues arise.”

Many reports say that the families will likely end up being told to keep the money. As of this reporting there is still no information on the IRS website about what to do if you get a stimulus payment for a deceased relative, but according to Marketwatch, there is no clause in the bill that says the money has to be sent back.

Nina Olson, the former head of internal IRS watchdog Taxpayer Advocate Service, told Marketwatch, “The CARES Act stimulus bill contained no ‘clawback’ provisions for stimulus checks sent to a dead person, meaning the agency can’t retrieve the money after it’s been handed out. Congress didn’t write around that this year.”


Dead People Can Get Money Because Their Bank Accounts  Often Take Time to Close

According to Bankrate, it is common for a person to die without a plan for their bank account. “If the account isn’t held jointly or in a trust … the account is off-limits until the estate is settled in court. In the meantime, a judge may issue a letter that grants an executor or estate administrator access.”

This means the IRS still has open bank accounts to send money to even though the account owners could’ve been dead for some time.

Cleveland’s 19 News reported that one man whose father died in June 2019 had reported his father’s death to the Social Security Administration but had to keep his dad’s bank account open to file his 2019 taxes. He recently realized that a stimulus check had been issued to his late father. The son, Larry Sohn, told the news channel, “Some branch of the government knew that he was deceased.”

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