More Than 1 Million Stimulus Payments Issued To Deceased, Watchdog Finds

More Than 1 Million Stimulus Payments Issued To Deceased, Watchdog Finds

The US Government Accountability Office (USGAO) has stated that about $1.4 billion in COVID-19 stimulus payments were mistakenly sent to dead Americans.

Thursday's GAO report said there's "a significant risk" of fraud with the forgivable PPP loan program because it had limited safeguards. But the IRS and the Treasury Department "did not use the death records to stop payments to deceased individuals" when it sent out the first batches of stimulus checks this spring, according to the report.

The report, which looked at how the almost $3 trillion CARES Act stimulus package was administered, said that the IRS typically uses third-party data such as death records maintained by the Social Security Administration to prevent erroneous tax refund claims.

To keep it from happening again if future stimulus checks are approved, the GAO recommended that Congress pass legislation giving the Treasury Department access to Social Security Administration death records, and requiring their use to determine if someone is eligible. After the Small Business Administration initially wasn't cooperating with the GAO's requests for interviews and loan data, Dodaro said he spoke with SBA Administrator Jovita Carranza on Thursday night, and that she agreed to work with the GAO to provide data as well as design oversight and monitoring plans.

GAO said the errant $1,200 payments were made due to the speed with which the IRS and Treasury moved to disburse $269.3 billion to 160.4 million taxpayers but noted Social Security data should have been used to minimize payments to dead taxpayers.

"It is unfortunate that the public will have waited more than four months since the enactment of the CARES Act for access to comprehensive obligation and expenditure information about the programs funded through these relief laws", GAO said.

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News reports had previously uncovered that some payments were sent to dead people, but until today's report it was not yet known how bad the problem really was.

The payments, established under The Cares Act, were sent out to Americans who filed a 2018 or 2019 tax return, and made up to $99,000 annually.

The report also revealed that lawyers working for the IRS "determined that the 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's also possible the check will "denote that the person is deceased next to their name", the AP reports.

Dodaro recommended that the IRS look at ways to to contact people who received these payments to try to recoup the money.

On May 6, the IRS announced on its website that stimulus payments issued to dead or incarcerated individuals should be given back, but according to the Post, the IRS has not taken any further steps to ensure the return of those payments.

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