Stimulus Checks for COVID-19 Relief

    About 130 million Americans have received the $1,200 check promised by the federal government, but millions more are still waiting to get stimulated.

    The IRS estimated that another 20 million consumers are still due their slice of coronavirus assistance from the $2.2 trillion CARES Act that passed on March 27.

    Those that need to update their direct deposit information using the IRS Get My Payment Tool have until noon on Wednesday, May 13. After the deadline, the IRS will begin preparing millions of paper checks that will be mailed out in late May and into June.

    Many received the stimulus check in early May, alongside their usual monthly benefit payment for Social Security, disability benefits (SSDI), Railroad Retirement Benefits, Supplemental Social Security (SSi) and VA.

    Why Is It Taking So Long to Receive Stimulus Checks?

    Feeding 150 million Americans a relief check is an unprecedented economic relief effort and exposed a lot of the flaws in the way the federal government conducts business.

    For starters, the antiquated computer system used by the IRS couldn’t handle the volume of traffic or requests it received. The IRS created a “Get My Payment” portal to tell consumers when they should receive their stimulus check and how it would be delivered. It failed miserably, returning the error message “Payment Status Not Available” so many times that people simply quit trying to use it. The IRS said it solved the problems over the April 24-26 weekend.

    If you receive the dreaded “Payment Status Not Available” message, it means:

    • The IRS has not processed your 2019 tax return
    • The application doesn’t have your bank data and the IRS is working to add it
    • You don’t usually file a tax return
    • You used the Non-Filers section of the website and your entry hasn’t been processed yet
    • You receive SSI or VA benefits and don’t file a tax return
    • You’re not eligible for a payment (see Eligibility)

    The information on the Get My Payment portal is updated once per day, overnight so there is no need to check more often.

    Eligibility for the COVID-19 Relief Check

    Every individual making $75,000 or less will receive a check from the U.S. Treasury for $1,200. Couples making less than $150,000 and that file taxes jointly should each receive $1,200 for a total of $2,400 with an additional $500 for each child.

    Those making between $75,000 and $99,000 a year ($198,000 jointly) should receive reduced checks on a sliding scale.

    Eligibility is being determined by 2019 and 2018 tax returns, but for those that are not required to file taxes, the IRS has set up a separate tool. Follow the link in these instructions for non-filers. The government will verify your income for those years and, if you qualify and have a bank account registered for tax refunds, you should receive a direct deposit. If you don’t have a bank account registered with the IRS for direct deposits, you should receive a stimulus check in the mail, though it may not come until sometime in May.

    Problems with the Stimulus Payments

    The IRS response is one of many efforts meant to ease tensions with American consumers anxious to get their share of the $2.2 trillion stimulus bill that was signed on March 26.

    The $1,200 stimulus check that was supposed to be a debt-relief option for those earning less than $75,000 a year, is stalled-in-transit for millions of taxpayers who used TurboTax, H&R Block, Jackson Hewitt and other tax preparer programs to file their taxes in 2018 or 2019.

    Another group is complaining that the wrong amount was deposited in their account; specifically they didn’t get $500 for each child.

    The setback inflicts more damage on a U.S. economy reeling from the effects of the COVID-19 pandemic that has forced most businesses to close, or have employees work from home until the spread of the virus is under control.

    In the last seven weeks, 33.5 million Americans have registered for unemployment benefits, bringing the unemployment rate up to 14.7%. Most workers were counting on the stimulus checks to help tide them over until the economy, and hopefully their jobs, return.

    Debt Collection Agencies Garnishing Coronavirus Relief Checks

    And, as if there weren’t enough problems already with the stimulus checks, word came out that debt collection agencies were aggressively grabbing at some consumers’ bank accounts the minute the check arrived.

    If the debt collector had a court judgment against someone who was behind on bill paying, the collection agency has a right to garnish the money from the stimulus check to apply to the debt.

    Scammers Alert

    The Federal Trade Commission said it has received 27,331 complaints from consumers being taken advantage of it during the coronavirus crisis. That represents a more than 400% rise in complaints as compared to all other problems in the first three months of the year.

    More than half the complaints (14,753) reported fraud via phone, email or other online contact  regarding credit cards, bank accounts, wire transfers prepaid cards and others.

    There also were 2,118 complaints about identity theft; 1,625 regarding No Call violations (callers pretending to be government or business representatives) and more than 9,000 in a category the FTC dubbed “Other.”

    Author

    Bill Fay
    Staff Writer

    Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it seven years ago, helping birth Debt.org into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering college and professional sports, which are the fantasy worlds of finance. His work has been published by the Associated Press, New York Times, Washington Post, Chicago Tribune, Sports Illustrated and Sporting News, among others. His interest in sports has waned some, but his interest in never reaching for his wallet is as passionate as ever. Bill can be reached at bfay@debt.org.

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