Trade Groups Say IRS Coronavirus Payment Process is Confounding Credit Unions, Members
Read more at the Washington Credit Union Daily
The Internal Revenue Service’s portal to provide information to consumers about their federal coronavirus Economic Impact Payments is providing inaccurate information to many financial institutions and their customers, creating confusion for everyone involved, trade groups said last week.
“The information provided by the portal is often inaccurate, causing confusion for recipients because it is not updated in a sufficiently timely manner, resulting in erroneous messages to recipients,” groups including the Credit Union National Association, the National Association of Federally-Insured Credit Unions, the American Bankers Association and the Independent Community Bankers of America, wrote in a letter to IRS Commissioner Charles Rettig.
Congress earlier this year approved new coronavirus impact payments of up to $1,200 for millions of taxpayers. In many cases, those payments are being made directly into taxpayers’ bank and credit union accounts.
IRS officials said that since March 12, the IRS has made more than $156 million payments to taxpayers, totaling about $372 billion.
The IRS has established a “Get My Payment” portal for taxpayers to check the status of their payments. However, that portal is now being updated on a weekly basis, while it was updated more frequently in the past.
Credit unions have been informing members that they have no information about when payments will be made and are referring questions to the IRS.
In their letter, the trade groups said the process is confounding. For instance, if a financial institution returns a direct deposit to the IRS because an account has been closed, the payment may continue to be recorded for several days. That leads to the IRS informing recipients that the money should be in their accounts when it is not.
“This has resulted in spikes in volume at financial institution call centers and branch locations with recipients seeking to locate their funds,” the groups said. “Understandably, the recipients are confused when the financial institutions tell them the facts of the situation and the [payment] portal reports conflicting information.”
Many of those issues would be resolved if the IRS updated its database more frequently, the trade groups said. Also, they asked the IRS to prominently state on its portal landing page that financial institutions do not have access to payment information and that the information provided may be inaccurate because of delays.