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CORONAVIRUS STIMULUS CHECKS

Third stimulus check: who could have to return the money and why?

There are some people that, believe it or not, want to return their $1,400 stimulus checks and others who got one by mistake and are required to return it.

Greg Heilman
Greg Heilman
Is a disaster distribution the same as a stimulus check?

The past year has seen the federal government dole out hundreds of billions in stimulus money to prop up families severely affected by the covid-19 Pandemic. The latest round saw all eligible Americans receive up to $1,400 to help see them through economic hardship.

Some people that have received the extra money are trying to return it to the Internal Revenue Service (IRS), out of guilt because they don’t need the money. Others because they were not in favor of the measure so they feel that they shouldn’t keep it. But there are cases where people received a check when they shouldn’t have, these people will have to return the money.

How to return your $1,400 stimulus check to the IRS

If you don’t need the money from the stimulus check and are intent on not keeping it the IRS encourages people to donate the money to a nonprofit or charity organization in their community. There have been several stories reported throughout the year of people leaving generous tips to wait staff, one group that has seen their livelihood especially hurt by the pandemic.

In order to return the money and avoid the IRS reissuing the payment the agency asks that you send a brief explanation stating that you don’t want the payment and that you do not want the payment reissued, along with the payment, paper check or EIP debit card.

Here is how to send each type of payment:

  • If you received a direct deposit, you will need to send a check or money order payable to the US Treasury, include “Third EIP” and your taxpayer ID number somewhere on the check. To consult where to send the check or money order the IRS provides a list of addresses.
  • If you received a paper check from the IRS, you’ll need to void the check and send it back to the IRS. Don't staple, bend, or paper clip the check. To consult where to send your paper stimulus check the IRS provides a list of addresses.
  • If you received an EIP debit card, you will need to send the card to the following address: Money Network Cardholder Services, 2900 Westside Parkway, Alpharetta, GA 30004

Who is required to send back their $1,400 stimulus check?

The first two rounds of stimulus checks were advance payments on the 2020 Recovery Rebate Credit. The IRS used 2018 and 2019 tax returns to judge eligibility for the payments. Taxpayers who didn’t get the full amount due to them can now claim the money on their 2020 tax return. Likewise, the $1,400 stimulus checks are an advanced payment on the Recovery Rebate Credit, but this time for the 2021 fiscal year.

So according to Kiplinger if anyone who died before January 1, 2021, is not eligible for a third stimulus payment. Depending on how the payment was sent the family will need to return it to the IRS along with a letter explaining the situation. In the case of a surviving spouse, if the payment was made out in the name of the deceased, the agency will issue a new payment with the name of the surviving spouse.

Clerical errors happen all too often and one such saw some “nonresident aliens” receiving checks that should not have. These are people who don’t possess a green card and are not US citizens. Only people that meet the economic eligibility requirements and have a Social Security number can receive a stimulus check.

Another case is where two separate payments were issued for the same person, for example a recently emancipated dependent. One of the payments must be returned to the IRS with a note explaining the situation.