IRS sent your stimulus check to the wrong account? 11 reasons your payment isn’t here

The IRS has made approximately 79% of the second stimulus check payments it’s going to send in this round, but not all those checks went to the right place. Millions of $600 checks the IRS issued through direct deposit were routed to the wrong bank accounts, according to tax preparation firms like Jackson Hewitt and TurboTax, and even acknowledged by the IRS.

“Because of an IRS error, millions of payments were sent to the wrong accounts and some may not have received their stimulus payment,” Jackson Hewitt said in a statement this week. TurboTax confirmed the issue in a Facebook post: “We have been working tirelessly on a solution with the Treasury and the IRS.” The IRS, Treasury and tax-preparation companies had a similar issue with the first round of stimulus payments last year.

The IRS confirmed there may be problems with electronic payments with the second checks: “Because of the speed at which the law required the IRS to issue the second round of Economic Impact Payments, some payments may have been sent to an account that may be closed or, is or no longer active, or unfamiliar.”

Part of the problem is a Jan. 15 deadline established by Congress to wrap up sending stimulus payments. As a result, the IRS is rushing to deliver as possible by the mid-month deadline (here’s what happens after that). As of this week, the Treasury Department has made about two-thirds of the second round of payments through electronic transfer to bank accounts of eligible Americans, according to The Wall Street Journal. (The Treasury also said this week it has mailed 8 million EIP prepaid debit cards as well.)

The Committee for a Responsible Federal Budget said as of Thursday, $5 billion in payments have been returned for various reasons, including from this tax preparation error with the IRS.

But that isn’t the only problem that may be holding up your check or keeping you from finding the status of your payment. Here are additional reasons your payment might be delayed or worse, and why the IRS Get My Payment tool isn’t showing you the current status of your payment.

You used Jackson Hewitt, TurboTax, H&R Block or another tax-preparation service to file your 2019 taxes

With the first checks the IRS and US Treasury sent last year to bank accounts, some who used a tax preparer like TurboTax or H&R Block may have run into trouble receiving their payment via direct deposit. The problem was with the direct deposit information the IRS had on file provided from the tax preparer.

The IRS said some who used a tax preparation service may have a similar problem with the second round of payments.” If the second Economic Impact Payment was sent to a temporary account that is closed or is no longer active, the IRS is currently working with our tax industry partners on options to potentially get these payment to individuals as quickly as possible,” the IRS said in a statement this week.

Jackson Hewitt, TurboTax and H&R Block each alerted customers this week that they are seeing similar issues with the second round of payments. “We recognize how important these stimulus payments are to our clients,” Jackson Hewitt said in a statement this week, “And are working tirelessly with our bank partner and the U.S. Treasury to swiftly find a solution to distribute this money as quickly as possible.”

Each tax preparer says it’s resolving the issues with the IRS. “Our expectation now is that within days the error will be corrected and stimulus payments will begin being deposited into the correct bank accounts,” said TurboTax in a statement. “We have also re-confirmed with the IRS that they have all of the correct banking information for our customers.”

Jackson Hewitt said it will work with those customers who don’t receive their payment via direct deposit to claim their payment as a Recovery Rebate Credit on their federal tax return this year.

You closed the bank account the IRS has on file for you

A temporary bank account set up by a tax preparer is not the only reason the IRS doesn’t usable direct deposit information for you. If you closed the bank account the government has on file for you, your payment will get returned without ever reaching your hands.

The IRS said it has a handful of ways to find your banking information, including from your 2019 tax return, from the IRS’ Get My Payment app or Non-Filer app if you used it last year, or if another federal agency uses it to issue benefits, such as from the Social Security Administration.

If the IRS has out-of-date bank deposit info for you, the banking institution will return the payment, and you will need to claim the amount you are owned on your 2020 tax return as a Recovery Rebate Credit. Note, that if If your benefits are deposited to a Direct Express card, your second stimulus payment will also be deposited to that card, the IRS said.

You don’t usually file a tax return

The IRS said it will automatically send payments to those who receive Social Security retirement, survivor or disability benefits (SSDI), Railroad Retirement benefits as well as Supplemental Security Income (SSI) and Veterans Affairs beneficiaries who didn’t file a tax return. With the first checks, however, some of these recipients needed to take an additional step to claim their check. If you’ve not received your payment by the time tax season starts, the IRS recommends you submit a federal tax return to request your payment.

You’re not eligible to receive the second stimulus check

This might be a painful answer, but if you’ve used the IRS’ Get My Payment tool to check on the status of your payment and you see the message “Payment Status Not Available,” you may not be eligible to receive a stimulus payment. If you want to double-check that, we have a stimulus check calculator to help you get a quick idea of if you qualify for a payment and for how much.

It might be that your adjusted gross income from the previous year is high enough that you don’t qualify. That’s the tax-related income figure the IRS uses as part of the formula to calculate your payment. We have a handy primer on eligibility, or you can check the IRS website directly.

Other specific situations include:

You moved and the IRS doesn’t have your new address

If you moved and didn’t inform the IRS and USPS, your physical stimulus check or EIP card might not find you. While you may need to ultimately claim your next stimulus check during tax season, you’ll still want to change your address in anticipation of the third stimulus check that President-elect Joe Biden is already talking about. 

Your check missed the Jan. 15 deadline

We have no doubt that the IRS and US Treasury is scrambling to meet the Jan. 15 deadline to process payments. But with tens of millions of payments to work through in a total of 17 days (from Dec. 29 through Jan. 15, including weekends), we can guess that some stimulus checks may not make the final sprint. In that case, you will need to claim your missing money through the IRS’ Recovery Rebate Credit during tax season.

Your stimulus check was mistakenly garnished to cover unpaid debts

With the first check, there were several situations where your check could be diverted to cover certain debts, including to cover past-due child support.

For the second check, Congress did away with many of the situations where creditors and debt collectors could garnish your payment — including to pay back child support — but your bank may still be able to use your second check to cover overdraft fees.

The IRS doesn’t have your current banking information 

For the first check, the IRS used banking information from your 2018 or 2019 tax return to send your payment. For the second check, the IRS said it is using just your 2019 tax return.

Some tax preparers, however, set up temporary accounts for their clients to receive their returns, such as to a prepaid debit card. If this is the information the IRS had for you with the first check, the agency said the payment was returned and reprocessed.

While the IRS has not provided information on how it will handle this situation for second checks, we recommend checking the Get My Payment tool once it is available again, and if you don’t receive your payment requesting it when you file your federal taxes this year.

A claimed dependent doesn’t qualify for a payment

In general, parents who are not married to each other and do not file a joint return cannot claim a qualifying child as a dependent. The parent who claimed their child on their 2019 return may receive the payment. Likewise, dependent college students do not qualify for a payment. 

There is a loophole, however, that applied to the first stimulus check that allowed non-married parents in child support situations, filing separately, who claimed a dependent in alternate years to each receive the $500 payment per qualified dependent. Confusing, yes. It isn’t clear if that would also apply to the $600-per-child in the second stimulus check.

You may have thrown away the envelope with your payment

With the first payment, some reported accidentally throwing out the envelope containing their check, not recognizing it contained their stimulus payment. The IRS recommends you watch your mail for a white envelope with the US Department of the Treasury seal. If you receive a prepaid debit card, it will have the Visa name on the front of the card and the issuing bank, MetaBank, N.A., on the back.

You may be the victim of a scam

The FBI and IRS warn that scammers are looking to steal your stimulus check. We have a guide for how to guard against and report these attacks. With the first checks, the IRS sent a letter notifying you that the agency had sent your money — with details on whether it came through the mail or straight to your bank — and with information on how to report that the money didn’t arrive. The IRS said it is sending a similar letter with payment for the second checks.

As you try to discover the status of your stimulus check, here’s what we know about who qualifies, how much you could expect and how to get an estimate of how much to expect.