Press Release
Posted:
Washington – Today Ways and Means Select Revenue Measures Subcommittee Chairman Mike Thompson (CA-05) and Oversight Subcommittee Chairman John Lewis (GA-05) released a letter written to Treasury Secretary Steven Mnuchin asking for answers about continued delays of stimulus payments to millions of Americans. The Chairmen cited news reports of payments incorrectly going to tax preparers or third-party banks and not the intended taxpayer. They demanded answers about these delays and returned payments, including what steps are being done to correct these mistakes. A copy of the letter is below.
April 21, 2020
The Honorable Steven T. Mnuchin
Secretary
U.S. Department of the Treasury
1500 Pennsylvania Avenue, N.W.
Washington, D.C. 20220
Dear Secretary Mnuchin,
We write seeking information about issues that may be causing stimulus payments authorized under the Coronavirus Aid, Relief, and Economic Security Act to be returned to the Department of the Treasury (Treasury). Given the ongoing economic and health crisis, it is imperative that Americans eligible to receive stimulus payments are provided such funds as swiftly as possible.
Last week, we understand that Treasury attempted to pay $150 billion in stimulus payments by direct deposit to “80 million Americans.” These payments were made using direct deposit information included on 2018 or 2019 tax returns. Based on press reports and constituent inquiries, however, it appears that many Americans did not receive scheduled stimulus payments as a result of incorrect banking information.
There seems to be a variety of reasons for the direct deposit issues. It has been reported that there may be tens of millions of taxpayers who relied on commercial tax preparation software or services for whom Treasury cannot deposit the stimulus payment into their bank accounts.
Other taxpayers may have received advances on their federal tax refunds through refund anticipation products, and their stimulus payments incorrectly went to third-party banks that provided the money for the advance to the preparers. While it is unclear why these payments were sent to accounts that should have been designated as temporary, we understand these stimulus payments should be returned to Treasury.
Furthermore, we heard that Treasury has incorrect, or closed, bank account information on file for some taxpayers. We also understand that these stimulus payments should be returned to Treasury.
On April 16, 2020, Treasury reported that nearly one billion dollars of federal tax refunds were returned by financial institutions to Treasury. There are many questions regarding this amount, including the number of payments returned, the reasons the payments were returned, and how many payments Treasury estimates will be returned. For Americans whose stimulus payments were returned to Treasury, it is important to communicate this information to them.
Therefore, given the information above, please provide answers to the following questions by no later than tomorrow, April 22:
- What is the total number and dollar amount of stimulus payments that have been returned to Treasury to date?
- What are the leading factors causing stimulus payments to be returned to Treasury?
- When stimulus payments are returned to Treasury, what actions are taken to ensure such funds are promptly delivered to the intended recipients and update any error related to their account information?
Thank you, in advance, for your attention to this urgent matter.