IRS Will Provide Funding for Tens of Millions by Direct Deposit Effective Wednesday, March 17
HERNDON, Va., March 15, 2021
HERNDON, Va., March 15, 2021 /PRNewswire/ -- Nacha, the organization that governs the ACH Network, issued a statement to provide facts on when economic impact payments via Direct Deposit were instructed to be made available to eligible Americans:
The IRS announced that the settlement date for the initial wave of tens of millions of economic impact payments by Direct Deposit will be Wednesday, March 17. This is the date on which the IRS will provide the funds to the banks and credit unions to further make available to recipients. The Nacha Rules require the banks and credit unions to make the funds available to the account holders by 9:00 a.m. local time on the settlement date; again, in this case, March 17.
The ACH Network is capable of clearing and settling payments, and making funds available as soon as the same day on which Direct Deposits are sent. The Nacha Rules allow for ACH credits, such as Direct Deposits, to use an "effective date" of either one or two banking days in the future, or, since 2016, a "same day" effective date. It is up to the sender—in this case the IRS—to decide when it wants the money to be made available. The IRS chose the date of March 17, which is the date on which the IRS intends for settlement to occur.
Regardless of when payment files were sent and received, settlement of the funds for the payments will occur at 8:30 a.m. ET on Wednesday, March 17, exactly as instructed by the IRS. This is literally the moment in time when the money will be transferred from the government to banks' and credit unions' settlement accounts at the Federal Reserve. There is no mystery where the money is from the time the first payment file was transmitted on Friday, March 12 to when all recipients will have access to the money on Wednesday—it is still with the government.
Nacha governs the thriving ACH Network, the payment system that drives safe, smart, and fast Direct Deposits and Direct Payments with the capability to reach all U.S. bank and credit union accounts. Nearly 27 billion ACH payments were made in 2020, valued at close to $62 trillion. Through problem-solving and consensus-building among diverse payment industry stakeholders, Nacha advances innovation and interoperability in the payments system. Nacha develops rules and standards, provides industry solutions, and delivers education, accreditation, and advisory services. Learn more at Nacha.org.
View original content to download multimedia:http://www.prnewswire.com/news-releases/irs-will-provide-funding-for-tens-of-millions-by-direct-deposit-effective-wednesday-march-17-301247424.html