IRS Canceling Stimulus Checks Issued to Dead People

The IRS has reportedly begun canceling stimulus checks sent to deceased people if they have not been cashed yet. After a few hectic months of processing taxes while distributing a stimulus check to millions of taxpayers, the Internal Revenue Service announced that it has now turned its attention on the millions of checks sent to dead people. It is still asking those who cashed checks sent to deceased loved ones to return the money as well.

The announcement came on the IRS' website on Friday in its latest news release. Stimulus checks were sent out based on the latest information from 2018 and 2019 tax filings, but many people have passed away since sending those documents in. Now, the IRS is catching up with new information to cancel those uncashed checks. This follows a wave of outrage from readers as recent reports tallied the amount of money sent to dead people this spring.

"The cancellation of uncashed checks is part of this process," the IRS said. "[The Bureau of Fiscal Services] has cancelled outstanding Economic Impact Payment (EIP) checks issued to recipients who may not be eligible, including those who may be deceased."

Americans learned just how many stimulus checks went to the dead last month, thanks to a report from the U.S. Government Accountability Office obtained by The Washington Post. It showed that about 1.1 million payments were sent to deceased Americans — totaling about $1.4 billion in taxpayer money.

While the IRS and Treasury Department officials have repeatedly said that Americans are expected to return money sent to their deceased loved ones, analysts say that the IRS has almost no way of enforcing that rule. Americans who cashed those checks will most likely be able to keep them.

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The IRS was pushed to the limit when asked to distribute stimulus checks this fall. The understaffed and under-funded agency was already trying to process new tax filings when the U.S. Congress passed the CARES Act, asking the Treasury Department to send out checks based on tax information. The agency even rolled out a new online tool called Get My Payment, where Americans could share their up-to-date information with the IRS if it was not correct on their latest taxes.

Thankfully, many of the wrinkles in the process have now been smoothed out just as lawmakers are beginning to consider another big coronavirus stimulus package. At the end of this week, the United States Senate returns from a two-week recess, at which point it will reportedly begin considering the next round of financial aid. Many Americans hope it will include another stimulus check.