Millions of incentive payments for TurboTax customers and others sent to the wrong accounts

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Payments, worth up to $ 600 per taxpayer and $ 600 for each of its dependents, were part of Covid’s latest relief package signed into law in late December.

The IRS began issuing direct deposits of these payments on Dec. 29 and says up to $ 100 million has already been completed.

But according to Intuit TurboTax spokeswoman Ashley McMahon, “millions of payments were sent to the wrong accounts and some may not have received their encouragement.”

According to a source in the banking sector, it is possible that approximately 13 million people have been affected.

On Friday, the IRS said it was taking immediate steps to redirect stimulus payments to the correct account of those affected.
“For taxpayers who checked Get My Payment and received a response stating that a direct deposit should be sent to an account they don’t recognize, the IRS advises them to continue monitoring their bank account deposits.” , the agency reported.

The people most likely to be affected are those who used loans to anticipate returns or similar products. In these cases, your incentive payments may have been directed to the temporary bank account established by the online tax preparation company they used when the 2019 return was filed.

It may also have affected some people who changed banks over the past year, and the IRS has not yet registered its new checking account.

Earlier this week, the IRS attributed the error to the speed with which the new law required the agency to issue the second round of economic impact payments.

For anyone who does not receive the stimulus payment before filing their 2020 tax return, the IRS advises them to claim the refundable rebate credit. The credit will be granted in the same amount as the stimulus payment for which you are eligible. Refundable credits reduce your tax liability dollar by dollar, and if you exceed your tax liability, the rest will be sent to you as a refund.
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Friday morning, TurboTax said its customers are likely to start seeing their directly deposited stimulus payments soon.

“Stimulus payments will begin to be deposited on January 8 for millions of our customers affected by the IRS error,” the company wrote on its blog. “We expect most of these payments to be available that day, but banks could take a few business days to process.”

TurboTax said it will send an email to customers when their payments have been deposited.

You can learn more about the status of the IRS and the procedures for receiving payment for incentives here and here.

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