PAYMENTS AND FRAUD

Specific exemptions apply prohibiting garnishment of economic impact funds, such as for federal garnishment orders (CARES Act), certain federal benefits payments, certain unemployment benefits (state law), and student loan debt (CARES Act).

Absent additional guidance or clarification from the U.S. Department of Treasury, Economic Impact payments may otherwise be garnished in accordance with garnishment orders currently in force. For example, payments may be garnished to provide child support pursuant to a court order.  

COVID-19 related developments continue to evolve. We recommend that you monitor the U.S. Treasury Department’s website in the event it issues any new information addressing garnishment protections regarding economic impact payments.

Some states and local jurisdictions have suspended enforcement of certain garnishment orders, and banks are encouraged to monitor developments from local and state jurisdictions.

No. A Payment made to someone who died before receipt of the Payment should be returned to the IRS by following the instructions about repayments. Return the entire Payment unless the Payment was made to joint filers and one spouse had not died before receipt of the Payment, in which case, you only need to return the portion of the Payment made on account of the decedent. This amount will be $1,200 unless adjusted gross income exceeded $150,000.

The United States Treasury Department has informed us that economic impact checks will look similar to IRS tax refund checks. They can be verified using the Treasury Check Verification Application, provided that the financial institution has a valid routing transit number, check number and check amount. This site also provides a description of Treasury Check Security Features. 

If the payment was a paper check:

1.      Write "Void" in the endorsement section on the back of the check.
2.      Mail the voided Treasury check immediately to the appropriate IRS location listed below.
3.      Don't staple, bend, or paper clip the check.
4.      Include a note stating the reason for returning the check. 

If the payment was a paper check and the heir has cashed it, or if the payment was a direct deposit, the recipient/heir should:

1.      Submit a personal check, money order, etc., immediately to the appropriate IRS location listed below.
2.      Write on the check/money order made payable to “U.S. Treasury” and write 2020EIP, and the taxpayer identification number (social security number,  or individual taxpayer identification number) of the recipient of the check.
3.      Include a brief explanation of the reason for returning the EIP.

For returning paper checks, the IRS mailing addresses to use based on the state where recipients are located can be viewed at https://www.irs.gov/coronavirus/economic-impact-payment-information-center#more.