FEDS SENT NEARLY $1.4 BILLION IN STIMULUS MONEY TO DEAD PEOPLE, REPORT FINDS
Dodaro testified a day after having a GAO report was published that unearthed that more than a million economic stimulus payments, totaling nearly $1.4 billion were delivered to people who were deceased.
Gene L. Dodaro, comptroller general of the United States, wears a nose and mouth mask as that he waves to members of a House Select Subcommittee on Capitol Hill in Washington, Friday, June 26, 2020, prior to the start of a hearing about a new report from the U.S. Government Accountability Office (GAO) with recommendations to improve the federal coronavirus response. (AP Photo/Carolyn Kaster)
The report, which looked at how a nearly $3 trillion CARES Act stimulus package was administered, said that the IRS an average of uses third-party data such as for example death records maintained by the Social Security Administration to prevent erroneous tax refund claims.
But with the economic stimulus checks sent out in April and May in response to the COVID-19 crisis, the Treasury Department and the IRS “did not use the death records to stop payments to deceased individuals for the first three batches of payments because of the legal interpretation under which IRS was operating.”
IRS counsel reportedly “determined that IRS did not have the legal authority to deny payments to those who filed a return for 2019, even if they were deceased at the time of payment.” It also advised “discretion” provided for in the CARES Act (which authorized the payments) to apply the same group of rules to those who filed a 2018 return although not one in 2019.
Treasury officials also cited language in the CARES Act that demanded the payments be made as “rapidly as possible” as to why Treasury and IRS used policies and procedures developed in 2008 for stimulus payments, and therefore “did not use the death records as a filter to halt payments to decedents in the first three batches of payments” in a effort to fulfill that mandate from Congress.
Dodaro said that in order to stop the payments, the Treasury had to give Treasury’s Bureau of Fiscal Service, which makes the payments, temporary access to a death master file. He said he has urged Congress to pass legislation giving it permanent access to the file.
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He went on to say that even their own mother, who died significantly more than two years ago, received a payment.
“My own mother received a payment, she unfortunately passed away in February 2018, and my sister got it on behalf of my mother and right on the check it said deceased,” he said, adding that the payment was came back.
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Dodaro said that considering that the report arrived on the scene, a number of citizens have emailed saying they’ve checks that have been mistakenly sent and are looking to get back them. He renewed his calls for Congress to pass a legislative fix to the problem.
“Congress needs to pass this legislation. … I think its very important,” he said, arguing that it could affect other government payments too. “It could be payment for agriculture, education or whatever, so I’d encourage you to do that.”