Return Your Stimulus Check?: Some People Have to Send Their Payment Back to IRS

Michael Hein

02/24/2021 12:23 pm EST

The stimulus check included in the last wave of coronavirus pandemic relief was meant to help all American taxpayers withstand the economic recession, but there are some rare cases where a person might need to send it back. If the U.S. Treasury Department issued a check to someone who is not eligible, there is a chance they will expect that money back. It is important to be absolutely sure you were eligible so you won't be expected to repay your stimulus check after you've already spent it.

The Treasury Department has tasked the IRS with issuing a stimulus check to every eligible American — a daunting task that has not always gone as planned. According to a report by CNET, an estimated 8 million Americans were eligible for the latest round of payments but did not receive them. These situations have drawn the most press coverage, but some examples exist on the other end of the spectrum.

The IRS mistakenly sent out stimulus checks to ineligible people in the spring of 2020, and in some cases, they asked those recipients to pay the money back. It is reasonable to expect similar mistakes to happen this time, rare as they might be. To be sure the money is yours for keeps, here is a list of the reasons you might be expected to pay your stimulus check back to the IRS.

'Nonresident Alien' Status

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Immigrants with "nonresident alien" status were deemed ineligible for stimulus checks — a policy that Democrats fought hard to reverse in negotiations. In some cases, nonresident aliens still benefited from other stimulus programs or direct payments sent to their spouses. However, if you are a nonresident alien and received a check addressed to you, it could be an error.

Noncitizen Taxpayer

The same is true for taxpayers who are not technically U.S. citizens, for one reason or another. If you received a check in this case, it is likely because you file federal taxes, and the IRS had your information on file. However, they could use those same methods to ask for your money back.

No Social Security Number

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The stimulus checks were generally deposited to those with Social Security Numbers, meaning U.S. citizens and permanent residents. There was some debate about sending checks to taxpayers with other forms of identification, but the plans never ultimately passed, so if you do not have an SSN, then you may be required to pay back your check later on.

Adjusted Gross Income

The IRS mistakenly sent checks to some Americans whose adjusted gross income (AGI) was too high, making them ineligible. Individuals with an AGI of $75,000 or less in their most recent tax filing were eligible for a full stimulus check, and the amount decreased incrementally above that. Those with an AGI of $99,000 or more were completely ineligible. Other income structures for joint tax filers and heads of household — visit the IRS' website for more information.

Dependent

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Anyone claimed as a dependent on another person's taxes was ineligible for a stimulus check of their own, even a young adult or an elderly family member. In some cases, the IRS could ask you to return your payment depending on your status.

Deceased

Finally, the IRS famously sent many stimulus checks to deceased Americans, not realizing their situation. If you received a stimulus check for a deceased loved one, the IRS has said you are expected to return it. However, there is some debate among experts about whether they have the power to recall that money.

How to Return

(Photo: ANDREW CABALLERO-REYNOLDS, Getty)

The IRS has published instructions for returning a stimulus check you received in error. To return a paper check that has not been cashed or deposited, you can write "VOID" in the endorsement section on the back of the check, write a brief note explaining why you are returning it. Put these together in an envelope and mail the check to the IRS headquarters in your state.

If you have cashed the check but now believe you need to return it, you can make a new check or money order to the U.S. Treasury and write the phrase "2020 EIP" in the memo. Again, write a note explaining the situation to the IRS, including your Social Security Number or your taxpayer identification number, and mail it to the appropriate IRS office. For more information on any of these scenarios, visit the IRS' website.

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