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After the IRS went wrong, the tax preparation company processed millions of stimulus checks



TurboTax said on Friday that it will begin to provide incentive checks for millions of Americans facing delays due to foreseeable IRS errors.

As many as 14 million people face potential delays or uncertainty when companies close alternative bank accounts that would otherwise have economically impacted payments, such as accounts used by tax preparation companies to process customer refunds and reload debit cards. The much-needed check is the lifeline of families affected by the pandemic and then “bounced” back to the IRS.

“The stimulus payments of millions of TurboTax customers who were mistakenly affected by the IRS will be deposited starting today,”

; spokeswoman Ashley McMahon said in an email to NBC News.

McMahon wrote: “We have been working tirelessly with the Treasury Department and the Internal Revenue Service to provide customers with stimulus payments.” “We know how important these funds are to so many Americans, and we are responsible for the delays caused by IRS errors. I’m sorry.” The company is posting an update on its website.

H&R Block, a tax preparation company whose customers have been frustrated, said in a statement, “This has been resolved for our customers earlier this week.”

Other tax preparation companies also blame the IRS for “mistakes” and advise clients to contact their tax preparers’ customer service for help. A spokesperson for the rechargeable debit card company said customers should contact the IRS.

Consumer law experts said that some taxpayers encountered similar problems in April, but did not take steps to prevent them from happening again.

The IRS did not immediately respond to a request for comment.

“If the second economic impact payment is sent to a closed or no longer valid account, the financial institution must return the payment to the IRS in accordance with the law. If the account does not exist, they cannot hold and issue the payment to the individual no longer Active.” The agency said in an online FAQ.

“The US Internal Revenue Service recommends that if they do not receive all the economic impact payments, they should electronically submit their 2020 tax returns and claim the refundable credits on their tax returns in order to obtain payment and Any refund.”

TurboTax’s move came after members of Congress issued a statement after responding to NBC News’ inquiries, blowing up the IRS and promising to reform the agency under the leadership of the new government.

Senator Ron Wyden of the Senate Finance Committee told NBC News in an email statement: “If Americans don’t receive a $600 relief check, I will be frustrated.” They don’t have it. Every day is a burden. “

Wyden said: “These difficulties are a symptom of the Republicans’ efforts to cut the IRS budget over the past decade and prevent the agency from working.” “I will improve IRS customer service as a key part of our democratic reform.”

In the spring, as the economic and health crisis deepened, 24 members of Congress wrote a letter to the Internal Revenue Service, asking for answers to why some families and individuals have not received relief inspections three months after the passage of the CARES Act .

Americans need these relief checks to put food on the table and keep it hot. These checks should be overdue long ago, and any further delays are unacceptable, Democratic Rep. Katie Porter, who signed the letter, told NBC News in an email statement on Wednesday.

“Just last summer when I asked the Trump Administration’s Internal Revenue Service for answers, why some people still have not received relief checks? I will continue to pressure the agency until they really provide what Americans desperately need in this crisis. help.”

The IRS plans to send a letter within two weeks after the payment is issued, telling taxpayers what to do if there are any problems (including not received). The Consumer Financial Protection Bureau has posted more information and resources online.

If taxpayers do not receive their stimulus payments, their only option may be the next tax. The Internal Revenue Service (IRS) will begin accepting tax returns for 2020 taxes in the next few weeks.

This is not enough for desperate Americans who want to get the stimulus payment they promised to put food on the table and avoid eviction.

“Someone told me that because we chose to pay our tax preparation fee from our 2019 refund, the stimulus was deposited into their (H&R Block) bank account instead of mine,” from West Memphis, Arkansas Cherish Long, 27, of the city, told NBC News in an online message.

She recently lost her job and has been planning to use the money to pay her rent and life-saving insulin.

“The renting is officially late after today, and I have enough insulin the next day or so. Literally, everything is on my husband. We are not even eligible for food stamps, so it is really very difficult and stressful.”

“For most of us, this is the weekly rent,” Destinee Coleman, 28, from Florida, told NBC News in an online message. She said that she filed a lawsuit against TurboTax and chose “refund transfer” to pay for the refund. Speaking of the stimulus check, she said: “Many of us hope to use this to help pay the rent.”

Some low-income customers who first used the “refund transfer” system to get them into trouble may already be eligible for free document services, such as VITA or IRS free documents.

Nearly 80% of taxpayers who use refund transfer products are eligible for income tax credit, a refundable tax credit that applies to low-income families below 150% of the poverty line.

According to a GAO report, in 2017, Americans spent nearly $1 billion on products that help them obtain advance payments or loans to repay taxes and apply for taxes.




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