Why Are Dead People Getting Stimulus Payments?

 

Well, yesterday, I kind of poked a little bit of fun at the proposed Emergency Money for the People Act for proposing that we make Venmo and PayPal a viable option for people to receive the next round of stimulus.

But after experiencing massive frustration yesterday with the IRS Get My Payment Tool and hearing from literally hundreds of people in my YouTube comments and elswhere, maybe I’ll change my mind about the whole Venmo thing.

Why Are Dead People Getting Stimulus Payments?

If you’d rather watch than read, check out the YouTube version here!

1. Why Are Dead People Getting Stimulus Checks?

But before I get into all that, I want to answer a question that many people are asking: “Why Are Dead People Receiving Stimulus Checks?”

And I’m not just talking about recently deceased individuals but people who passed away as long as three years ago!

I mean, their records have presumably been updated with the feds in some way — with the Social Security Administration at least, right? — but you have to remember, the IRS loves tax returns, so they’re just going off tax returns here, and there’s no box on the 1040 to indicate you’re dead.

Many tax prep software will ask that question, but if you’re paper filing a return, do you know what the IRS’ official instructions are to do for a deceased taxpayer?

It’s to literally handwrite at the top of the income tax return, the word “Deceased”, the decedent’s name, and their date of death.  Obviously if they have a taxable estate, that’s a different story because they’d have to file Form 1041, Tax Return for Estates and Trusts, but most folks, especially since the Tax Cuts & Jobs Act was signed do not have a taxable estate, if you do, you’re really rich.

And remember they’re going to 2018 for tax returns, so if someone passed away in 2018, and it somehow wasn’t processed in the IRS system that they are in fact deceased because it’s not computerized, there’s no box on the 1040 that their machines can read to indicate deceased, I imagine flagging a taxpayer as deceased is a very manual process at the IRS, right, so if that wasn’t done, then the decedent will likely get a stimulus check.

This happened with the last stimulus under Obama as well, over 70,000 dead people received stimulus payments, so nothing new.

Will the family have to pay it back?  IRS hasn’t issued any official guidance on this, and apparently they don’t know they’re dead, so.

2. IRS Get My Payment Tool: Terrible

OK sorry for that tangent, let’s get back to how terrible the IRS Get My Payment tool is, in contrary to what the IRS says about it, mind you, the IRS says, and I love this, “The Get My Payment site is operating smoothly and effectively…more than 6.2 million taxpayers have successfully received their payment status and almost 1.1 million taxpayers have successfully provided banking information, ensuring a direct deposit will be quickly sent.”

Well, the reality is that it’s not operating smoothly and effectively, maybe by government standards, but not real world standards where people are wondering where their cash is.  I mean, come on.  6.2 million out of how many people probably tried that site yesterday?  Only 1.1 million were able to provide banking information?  Come on.  That’s embarrassing.

Alright, so many of you where you try to use the IRS Get My Payment Tool are getting the error that says, “Payment Status Not Available.”

Payment Status Not Available IRS Get My Payment Tool

So apparently this error is pretty much a catchall error that’s not phrased very well at all.  And according to the IRS, it could mean one of the following things:

  • It could mean you are not eligible for a stimulus payment, we’ve gone over who’s eligible many times here on the channel
  • It could mean you are required to file a tax return and have not filed in tax year 2018 or 2019.
  • It could mean that you recently completed the IRS Tool for Non-Filers and that they haven’t processed you yet for that.
  • And finally, it could mean you are a Social Security Administration or Railroad Retirement Benefits Form 1099 recipient.  The IRS says that your payment information is not yet available in the Get My Payment Tool.

What a joke.

If you get this error, don’t waste your time trying to log in several times because apparently they only update the data in the tool once per day.

I mean, look, it was a pretty lofty goal to expect the IRS to be able to pull something like this off, right, and to be fair, I think a lot of us, we can be super critical and not understand the scale of data at the federal level, I mean we’ve had jobs where we had to get things done, you know, and we know how to get things done, and why can’t those lazy bums at the IRS just get this done?

Well, the scale here is massive, probably more massive in terms of database than most of us will experience in our lifetimes, and of course it is a government agency, what can you say?

And I mean, even banks yesterday apparently had problems with so many people accessing their sites to check for a stimulus payment, so.

3. Some People Think Their Tax Preparer Got Their Stimulus

But some folks in Tallahassee, Florida yesterday were claiming that the IRS incorrectly deposited their stimulus into their tax preparer’s bank account and not theirs.

Now I’m assuming they somehow concluded this from the IRS Get My Payment Tool, so apparently it was working for them, or maybe it wasn’t, and it was giving them bad information.  Or maybe it is good information and just a complete screw-up on the IRS’ part of depositing money to wrong accounts.

Anyway these customers stormed the gates yesterday of Galaxy Tax Service in Tallahassee demanding answers, and of course the owner says that whatever account they’re seeing the money deposited to is not associated with his business, so.

4. Banks Are Keeping Some Customers’ Stimulus Checks

Other folks have reported that their bank is keeping their stimulus payment if their account is overdrawn.

Well, what are you going to do?

It is kind of the bank’s right to do so, right, it’s in your customer agreement that banks can do this, the CARES Act does not prohibit this, but I was kind of surprised to learn which banks were doing this, I understand USAA is doing this, and I’ve seen reports of some small credit unions doing this, but it looks like the big banks — and I’m thinking in particular Wells, B of A, Citibank, and Chase — they’ve all stated that they are pausing collections on their customers’ negative balances so their customers can get the stimulus.

And maybe that makes sense.  The bigger banks can just eat it here, while smaller institutions may have to be a little more nickle-and-dimey right now.

5. Stimulus 2.0

Alright, Stimulus 2.0, still in early stages of course, I told you yesterday about the proposed Emergency Money for the People Act, that proposes monthly stimulus payments of $2,000 to $5,500 for at least six months.  And that’s per month, and paid however you want it, paper check, direct deposit, Venmo, PayPal, Zelle, prepaid debit cards, you name it, they’ll pay it.

I went over the details for that proposed next round of stimulus in a video yesterday, so you can check that out, now don’t get too excited, OK, because you know that it’s probably not going to happen like this, I mean I think monthly stimulus payments are possible, I think that both parties in Congress could get on board with that, but $5,500 per month to some folks, that’s a lot.

Andrew Yang, the King of UBI, Universal Basic Income, tweeted, obviously, that he supports $2,000 for every American per month throughout the duration of this crisis.

6. Trump’s Name on Checks (Part 2)

OK, what else, well you remember that in yesterday’s update I mentioned that Trump’s name will be on the memo line of the paper checks that should hopefully start going out in the next few weeks.

And I told you that Pelosi made some comments about it, well yesterday she put out a very brief press release on the matter, here it is: “Delaying direct payments to vulnerable families just to print his name on the check is another shameful example of President Trump’s catastrophic failure to treat this crisis with the urgency it demands.”

Will this delay the checks from going out?  I don’t know, some officials, anonymous of course, say it will, and others, anonymous of course, say it won’t.

So I don’t know if what Pelosi’s saying or assuming here is completely true, but time will tell.

7. California Stimulus for Illegal Immigrants

What else, Governor Newsom of California announced a plan for a $125 million statewide stimulus for illegal immigrants in California, funded 60% by California taxpayers like me and 40% by charities.

Up to $500 per adult and up to $1,000 per household.

I mean, this is a tough situation, lot of heated arguments about this on both sides, many illegal immigrants pay taxes, right, and they do contribute to our economy in a meaningful, beneficial way.

But they came here illegally, you know, and I don’t think that they should have the same rights and benefits of citizens or those who entered this country legally.

But on the other hand, they are human beings and deserve basic rights, and just economically they are a huge part of our economy, especially here in California, and to leave them out of the stimulus conversation here could have detrimental effects.

I’m definitely not as one-sided on this issue as I used to be, but we’ll see what happens here in California about this.

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