According to recent guidance released by the IRS, Federal stimulus payments sent to persons who have died must be returned.
As part of the procedure to determine who to send payments, the IRS used tax filings within the past two years. In a rush to get payments our as quickly as possible, some payments were sent to individuals who died during this two years window.
Before this guidance, it was unclear whether family members could keep the money. However, the IRS now says the entire payment must be returned unless the deceased person was married and filed tax returns jointly with a spouse who is still alive. In such a case, only the portion belonging to the deceased spouse need be returned (e.g. $1,200 of a $2,400 payment).
The IRS guidelines outline the procedure to return payments.
- If the payment was a paper check:
- Write “Void” in the endorsement section on the back of the check.
- Mail the voided Treasury check immediately to the appropriate IRS location listed below.
- Don’t staple, bend, or paper clip the check.
- Include a note stating the reason for returning the check.
- If the payment was a paper check and you have cashed it or if the payment was a direct deposit:
- Submit a personal check, money order, etc., immediately to the appropriate IRS location. For Indiana residents that location is:
Kansas City Refund Inquiry Unit
333 W Pershing Rd
Mail Stop 6800, N-2
Kansas City, MO 64108
- Write on the check/money order made payable to “U.S. Treasury” and write 2020EIP, and the taxpayer identification number (social security number, or individual taxpayer identification number) of the recipient of the check.
- Include a brief explanation of the reason for returning the Economic Impact Payment.
The IRS will be cross-checking with another federal agency to get a list of those deceased individuals who received payments to track returned payments.
For more information about Stimulus Payments, click here.
To track the status of your payment, click here.
For the IRS guidance of repayment, click here.
Jeff is Certified as an Elder Law Attorney (CELA) by the National Elder Law Foundation, a distinction held by only a handful of lawyers in Indiana. For almost 20 years, he has focused on elder law, estate planning, long-term care planning, Medicaid planning, Veterans Affairs benefits planning, special needs planning, guardianships, and estate administration.