The Covid Economy

'It's extremely frustrating:' IRS unresponsive as Americans seek answers on missing stimulus payments

Share
Miami Herald | Tribune News Service | Getty Images

After months of waiting for Congress to approve a second stimulus check, Rachael Flanagan, 34, was planning to use her payment to pay off some bills and feed her two children. But despite millions of the payments being sent out by the IRS, the New Hampshire resident still hasn't received hers.

Instead, she is met with the "Payment #2 Status — Not Available" message from the IRS's Get My Payment tool, which is meant to track the status of each taxpayer's stimulus check. But according to the agency, that status means she won't receive the payment automatically, and instead will have to claim a tax credit on her 2020 tax returns.

"It's extremely frustrating for my family because with my working we lost our food stamps so this little bit would help us," says Flanagan. She has called the IRS eight times for help, she says, to no avail.

Taylor Hill, 25, is facing a similar situation. The mother of two toddlers had planned to use the stimulus check to cover groceries and bills for the next few weeks. But so far, she hasn't received a payment and can't get through to the IRS.

"My bank account only has $47 in it," says Hill.

Flanagan and Hill are far from alone. After reporting that the IRS said some people will only receive their stimulus checks after they file their 2020 taxes, CNBC Make It received thousands of emails this week from Americans who have been counting on the funds to pay their bills and are frustrated that the IRS is not offering any answers or updates for them.

Many people told CNBC Make It that after calling the IRS about their checks, they were left waiting for, at times, hours, before being disconnected. The IRS is telling people not to call with questions and instead to check its website for updates. But the agency's site offers few answers to all of the questions that abound.

"I'm so disgusted," wrote one man who has not received his check yet.

"I find it very hard to believe that the U.S. government is this incompetent," wrote another.

IRS sent millions of payments to wrong bank accounts

One reason millions have not received the payments yet is because the IRS "inadvertently sent payments to over 13 million bank accounts that are no longer open or valid," according to tax preparer Jackson Hewitt.

Other tax preparation companies, including Republic Bank Taxpayer Solutions, TaxAct, Chime and TurboTax, have also released statements blaming the IRS for the mix-ups and delays in stimulus payments.

"Unfortunately, because of an IRS error, millions of payments were sent to the wrong accounts and some may not have received their stimulus payment," TurboTax wrote in a statement Wednesday. "We have been working tirelessly on a solution with the Treasury and the IRS."

The company expects that the checks will be deposited to the right accounts "within days."

While the tax companies are working to reassure customers, the IRS has not acknowledged the mistakes directly, saying only that issues may arise because the agency has to send out all of the payments by Jan. 15. The agency has not answered specific questions about the issues from CNBC Make It, instead directing reporters to the FAQ section about the payments on its website. It has not clarified why or how so many payments were sent to incorrect bank accounts.

"Because of the speed at which the law required the IRS to issue the second round of Economic Impact Payments, some payments may have been sent to an account that may be closed or is or no longer active," the agency says.

IRS not providing enough answers

But that explanation doesn't make sense to many Americans, including Louisiana resident Samantha Tanielu, who says she got the first payment last year with no issues or delays; none of her personal banking information has changed since then, so she doesn't understand why there are issues receiving the money this time around.

"Bills and food are the main things my stimulus check will go to," says Tanielu, who has tried contacting her local IRS office for answers, but has not received a response.

All of this has left many Americans feeling deserted by the government in their time of need.

"We are not tax cheats, identity thieves or people trying to get something for nothing," says New Hampshire resident Chad Abel-Kops, 50, who has not received the first or second stimulus payment and cannot reach anyone at the IRS to help him. 

"We are law-abiding Americans who followed instructions, submitted returns on time and properly, and not once has any communication from the IRS simply said, 'We are sorry.'"

Check out: 'Status Not Available:' IRS says these taxpayers won't receive second stimulus check automatically

Don't miss: The best credit cards for building credit of 2021

VIDEO0:0100:01
How a 31-year-old making $118,000 in Philadelphia spends his money