Biden directs Treasury, IRS to find 8M who haven't claimed stimulus

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Aaron Lorenzo
·3 min read
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The Treasury Department and IRS are working to get unclaimed economic relief payments to as many as 8 million households that haven’t yet received their due.

The undertaking, announced by the agencies Friday, is part of a broader initiative started by President Joe Biden’s executive order mobilizing the full federal government on various parts of Covid-19 relief and will include a web tool to help people find out if they’re eligible.

Much of the focus is on people not required to file tax returns.

“This is principally an issue associated with people who are non-filers, so they’re not filing income taxes in most cases because they don’t make enough to need to file federal income taxes,” National Economic Council Director Brian Deese said at a White House press briefing.

The planned online portal is an outgrowth of the existing IRS non-filer website established last year to help ensure names and contact information were registered for payments. Initial payments were distributed based on the past two years of tax return filings, but not all eligible recipients were in those databases since not everyone has to file tax returns.

Still waiting: Treasury and the IRS led two rounds of direct payments to individuals and households last year, the first following coronavirus aid legislation in March, the CARES Act, and then again after follow-up legislation was enacted in December.

A variety of hitches, though, prevented millions of eligible recipients from quickly getting the money they were owed, and many are still waiting.

“As many as 8 million households may be eligible for but have not yet received payments from the CARES Act signed in March; many of these households could be legally entitled to as much as $1,200 per adult,” according to a department fact sheet outlining the plan.

The goal is to swiftly get money out the door to help eligible recipients who for various reasons haven’t accessed their payments.

Other channels: In addition to the web tool, Treasury and the IRS will also reissue unclaimed economic relief payments from last year.

Hundreds of thousands of checks and debit cards authorized by the CARES Act were never cashed or activated. Some were accidentally thrown away. Debit cards, for example, were mailed in discreet envelopes that many people thought was junk mail or scam offers so they tossed them in the trash.

In addition to reissuing them, while turning off previously issued debit cards when new payments are made to help prevent fraud, Treasury and the IRS will also take outreach steps to encourage those who didn’t claim their benefits to do so on their 2020 tax returns due this year.

More education and awareness are needed in some cases, Deese said, noting plans to continue partnering with non-government groups to reach those missing out. The IRS worked through similar partnerships last year, too.

The underlying outreach will also attempt to connect with people who don’t have Internet access, or limited access, as well as those who don’t speak English.

Treasury and the IRS also plan to better target unserved households by leveraging information like addresses and zip codes on beneficiaries of other government assistance programs to pinpoint some who’ve missed payments.

Separate action: In addition to directing Covid-19 relief via executive order, Biden is taking other actions including quickly rescinding an executive order affecting Treasury and IRS personnel involved in tax regulations.

Lawmakers lauded Biden’s decision to eliminate the new Schedule F worker classification for all federal employees who work on regulations across the government, which would have stripped them of many labor protections. Former President Donald Trump issued the directive in October, telling agencies to start the Schedule F recharacterization on Jan. 19.

Critics said it would have effectively made rule-making federal employees the equivalent of political appointees — a negative for collecting taxes.

“The Ways and Means Committee previously called for this to be done, as it will preserve the nonpartisan nature of tax administration and limit the politicization of the federal government’s civil service,” Chair Richard Neal (D-Mass.) said in a statement.