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Dear Moneyist,
My daughter had already received and spent her stimulus money. This morning, she received an email from her bank; three more $1,200 deposits were made. We know she should return the money. Who do we contact?
Don
Dear Don,
I thought I’d heard all the bizarre stories about stimulus checks, but your letter proved me wrong.
I am receiving hundreds of emails every week from people who have not received their stimulus payments. People have said their checks were garnished for unpaid child support, while others are befuddled, bothered and bewildered that they didn’t receive a large enough check or no economic impact payment at all. Some taxpayers say they’ve received stimulus checks for dead relatives, while you have received two. One man said he was effectively “punished” by the government for being responsible because he filed his 2019 taxes early — and received $200 for his household.
Internal Revenue Service workers are clearly overwhelmed, and I applaud them for going into their offices during this time. But there are many stories of people who have their checks withheld by their own partner. This woman told me her husband said, “You don’t deserve it because you didn’t earn it.” I received a flurry of emails from spouses, mostly men, who said they would not allow their spouses access to their $1,200 payments, with one writing, “I’ll never give my wife $1,200 to blow her stimulus check. She’ll get a couple of hundred bucks to go shopping.”
But your daughter’s story really takes the biscuit. Your daughter can return the money via check or money order with the notation “2020EIP,” plus the Social Security number or taxpayer I.D. of the check recipient. Those people who received a paper check and did not cash it can write “void” on the back of the check’s endorsement section and mail it back to the IRS, according the IRS directions (see Q41), with an explanation. (Of the 4 million people receiving debit-card payments, some are mistaking the white envelopes for junk mail and actually throwing them out.)
In 8 of the top 10 cities, the economic impact payment only covers between 60% and 71% of an estimated monthly budget for a family of four, this recent Lending Tree survey found. The good news: People who did not receive a check this year or only a small amount and believe their income will fall below the required threshold for checks next year could still receive a stimulus payment next year. The EIP is technically an advance payment of a tax credit on your 2020 return. The IRS is using 2019 tax returns to gauge people’s incomes; 2018 tax returns are used as a Plan B.
The IRS has sent out 150 million payments so far, which is most of the stimulus money that’s been set aside for direct payments to families and individuals. That will obviously be welcome for the more than 36 million people who are out of a job: 2.12 million unemployed Americans applied for state unemployment benefits in the week ended May 23, the Labor Department said Thursday, down from 2.4 million in the prior week. Since the coronavirus pandemic and lockdowns started in mid-March, some 46 million people have applied for jobless claims, on an unadjusted basis.
I hope you and your family stay safe and healthy. Kudos to your daughter for returning the money.
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