Wall Street Journal, IRS Paid $1.4 Billion in Stimulus Payments to Dead People, GAO Report Says:
The Internal Revenue Service paid nearly $1.4 billion in stimulus checks to dead people, according to a Government Accountability Office report that provides the first tally of such payments.
Citing data from the tax agency’s inspector general through April 30, GAO said Thursday that the IRS made almost 1.1 million such payments before Treasury Department officials determined that deceased people were ineligible and began asking recipients to return the money.
New York Times, $1.4 Billion in Stimulus Funds Sent to Dead People, Watchdog Finds
Michael J. Graetz, a Columbia University law professor and former deputy assistant secretary for tax policy at the Treasury Department, said government money improperly going to the dead is a continuing problem when it comes to tax refunds and Social Security payments. In fact, improper payments for a broad range of expenses have been a long-term problem for the federal government. The G.A.O. reported that from 2003 to 2017, estimates of improper payment totaled about $1.4 trillion cumulatively.
But retrieving the money can be more expensive than absorbing the loss. Mr. Graetz said that while cashing a check that was sent to a dead person is illegal, the cost of trying to get back the money is most likely not worth it to recoup the $1,200 payments.
Still, he noted that such mistakes were the unfortunate consequence of pushing money out so quickly.
“It’s not chump change,” Mr. Graetz said. “A billion here, a billion there, and pretty soon it adds up.”
Washington Post, No, the IRS Should Not Try to Claw Back $1.4 Billion Sent to Dead People:
The optics of sending stimulus payments to dead people didn’t look good for the administration. So, in an offhand comment on April 17, Trump said the payments should be returned. “Sometimes you send a check to somebody wrong,” Trump said in a coronavirus task force press briefing. “Sometimes people are listed, they die, and they get a check. That can happen. … We’ll get that back.” ...
For many surviving spouses, adult children and estate administrators, the confusing signals have created anxiety over what to do with the payments — and the prospect that the IRS could go after people who have already spent the stimulus money. ...
The IRS doesn’t even have a plan to directly notify ineligible recipients on how to return payments, the GAO said. ...
Is the IRS really going to allocate resources to track down surviving spouses or heirs to recover stimulus money the recipients honestly didn’t know they couldn’t spend? After all, the intent of the economic impact payments was to stimulate the economy.
Yes, it’s shocking that $1.4 billion in stimulus payments were sent to dead people. But it’s too late for the IRS to try to claw back those funds. Let it go.