Stimulus Checks: IRS Reveals 800,000 Taxpayers Might Have Tossed Payments in the Trash

The first round of coronavirus relief stimulus checks had some issues getting to Americans, with the IRS now revealing that it believes around 800,000 taxpayers might have tossed their payments into the trash. According to Forbes, the department determined that the majority of these cases were stimulus payments sent by way of Economic Impact Payment, or EIP, cards. The IRS stated that they had reason to believe that many people who received their payment — issued through the CARES Act — accidentally "threw out the debit card thinking it was junk mail."

The IRS sent out letters to those that were believed to be affected by the situation, with a senior US Treasury official reporting that it "received a significant response" to the correspondence. "Approximately 92% of cards have been activated to date and new activation continue to come in daily," the official explained. "As of August 24, 2020, the number of cards not yet activated was 297,671." The first round of stimulus payments were sent out on EIP cards to about four million citizens. The card works just like a prepaid debit card and contains only the amount of money designated by the details of the bill.

The thrown-out cards are not the issue that the IRS has had with the EIP cards, as in July it was reported that taxpayers who were sent these had to pay hidden fees to use them in certain situations, prompting lawmakers to step in and speak up. Sen. Maggie Hassan of New Hampshire, as well as 14 other senators, sent a letter to Treasury Secretary Steven Mnuchin and IRS chief Charles Rettig and explained. For example, the EIP cards — in addition to charging fees for processing or money withdrawal — require that personal data be shared with third-party marketing companies. The letter also stated that recipients who tried to transfer the money from the card to their bank account were forced to "navigate a complicated registration process and provide substantial personal information."


The letter from the senators addresses an agreement that cardholders are expected to make, which they say "allows our constituents' personal information to be shared with third parties for marketing and other commercial purposes." The cards are issued by MetaBank and managed by Money Network Financial and require the cardholders to provide "significant personally identifiable information" in order to activate the card or transfer money. It has been speculated that if another stimulus payment is approved by the government, the EIP cards could be used again, but that is unconfirmed.