Sorry, you might have to return your stimulus money to the IRS. Here’s why and how

Many people are using tax season to not only claim their tax refunds but also to file for any stimulus money they didn’t receive with the first two payments. However, if you’re in a different boat where you received stimulus money you didn’t actually qualify for, the IRS could ask you to return it. We’ll help explain if this situation applies to you, especially since the third stimulus check could have similar rules.

When people are excluded from receiving stimulus checks, it’s due to the final eligibility rules outlined in the relief bills. For example, if the amount of money you made during the 2019 tax season surpasses the income cutoff for a stimulus payment, the IRS expects you to return the money. There were cases with the first stimulus check where the IRS sent out payments to people who weren’t eligible by accident. If you’re one of the people who received a check in error, there are specific ways to go about returning the money, depending on the payment method — paper check, EIP card or direct deposit.

We’ll explain some instances in which the IRS would expect you to return stimulus money that you weren’t eligible for, with details on how to do it. Also, now that the third stimulus check is close to approval, make sure you’re up to date on all the details — for example, the new check will be even more targeted this time, leaving higher earners out, but could also qualify more groups of people. Also, here’s how much money you could get and when it could arrive. This story was updated recently.

What if I receive more stimulus money than I should get from the third check?

While a third stimulus check is still in the works, we do know the amount is up to $1,400 per person. We also know that the income cutoff to receive a payment at all would be $80,000 for an individual taxpayer, $120,000 for a head of household and $160,000 for a married couple who files jointly. If you make more than that amount and still receive a third stimulus payment (assuming one is approved), the IRS will likely expect you to return the difference. 

However, if you made more in 2020 than you did in 2019, but you get a stimulus check before you file your taxes, you may not be expected to return that money. We’ll update this with the final rules when and if a bill passes. Meanwhile, you can use our third stimulus check calculator to estimate how much you could get.

The IRS expects you to return a stimulus payment for the following reasons

The government determines who is and isn’t eligible to receive a stimulus check based on several factors. If you fall into any of these categories and received a stimulus check, it was likely by error:

• You received a check for someone who has died — but there’s some nuance here (more below).
• You don’t have a Social Security number.
• You’re considered a “nonresident alien” without a US citizen spouse. (This could change, for some, with a third check.)
• You’re a noncitizen who files federal taxes.
• Your adjusted gross income exceeds the limit; for example, $87,000 for a single taxpayer with the second check.
• You’re claimed as a dependent on someone else’s taxes (this applies to the first and second checks).

Here’s more information about who didn’t qualify for the $600 stimulus check.

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Can I keep any stimulus money I received for someone who’s died?

If you received a payment for someone who died in 2019 or earlier, the IRS says you should return the entire payment “unless it was made to joint filers and one spouse is still living.” If you’re the living spouse, you should return half the payment — just not more than $1,200 in all. 

However, if the check is issued in both your name and your deceased spouse’s name (and therefore you can’t deposit the money), you’ll need to return the whole amount to the IRS. After the agency processes the returned payment, it will issue a new check with the correct amount for you.

If you’ve already cashed or deposited the stimulus check, here’s how to return it

1. Use a personal check or money order and make the check payable to the US Treasury. You’ll also need to write “2020 EIP” and include the taxpayer identification number or Social Security number of the person whose name is on the check. 

2. On a separate piece of paper, let the IRS know why you’re sending the check back.

3. Mail the check to the appropriate IRS location — that depends on which state you live in.

If you never cashed or deposited the paper check, here’s what to do to return the payment

If any of the above situations pertains to you, you may need to send your stimulus check back. Here’s how to do it for each scenario, per the IRS.

1. Write “VOID” in the endorsement section on the back of the check.

2. Do not bend, paper clip or staple the check.

3. On a separate piece of paper, let the IRS know why you’re sending the check back.

4. Mail the check to the appropriate IRS location — it varies depending on which state you live in.

Never received any stimulus money at all? What you need to know

If you’re among the more than 100 million people who were eligible to receive the second $600 stimulus check and it never arrived, you’ll likely need to claim it as a Recovery Credit Rebate on your 2020 taxes, even if you don’t usually file taxes. Alternatively, you may have to start an IRS payment trace.

If you aren’t signed up for direct deposit with the IRS, now’s a good time, as a third stimulus check is on the table. To do so, you’ll need to add your banking information when you file your 2020 taxes this year. We also encourage you to file your taxes as early as possible this year because of stimulus checks. Remember the deadline to file is April 15, but you can file an extension.

To stay updated on the latest stimulus check news, here’s when the IRS could start sending a third payment. If you’re having stimulus check problems, do this instead of calling the IRS. Also, here’s what’s happening right now with a third stimulus payment.

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