Stimulus Checks: Major Update on Payments Sent to Dead People

The majority of the stimulus checks sent to deceased Americans have been recovered, the Government Accountability Office said Monday in its latest report on the federal response to the coronavirus pandemic. The economic impact payment program was part of the CARES Act, signed into law in March and Americans began receiving the payments in mid-April. As physical checks were being mailed out, more than $1 billion was accidentally sent to deceased Americans, and the Internal Revenue Service asked Americans to return those payments.

The GAO said the Treasury Department recovered almost 70% of the $1.6 billion that went to dead people, reports The Associated Press. The office said it could not immediately verify the number, but its auditors are working with the Trump Administration to find out exactly how much was recovered. The Treasury is also planning to send out letters to family members who did not return the payments issued in a dead relative's name, the GAO said. The letters have been delayed though, since Congress is still planning further legislation on stimulus checks.

The GAO, a nonpartisan investigative Congressional office, previously asked members of Congress to make changes to the Social Security Act so the Social Security Administration could give more up to date death data to the Treasury Department to make sure mistakes like these do not happen when (or if) another stimulus check program is enacted. The Senate responded with the Stopping Improper Payments to Deceased People Act in June to do that. The bill still needs to pass in the House.

Reports of family members receiving stimulus checks with the names of deceased loved ones on them began springing up when the first round of physical checks was mailed out in April. Some people had no idea what to do in that situation until Treasury Secretary Steven Mnuchin said that the checks should not be spent and have to be sent back to the IRS. In May, the IRS also issued guidelines on how to return them. Americans needed to mail them back to the closest IRS offices to them, along with a brief note explaining why the payment was being sent back.

The CARES Act included a one-time stimulus check for qualifying Americans and were based on 2018 or 2019 tax filings. Individual Americans who earned up to $75,000 were eligible for $1,200 payments. Congress has yet to pass another coronavirus relief package with a second stimulus payment program.