Good news for retirees: The IRS has reversed course and eliminated a controversial requirement on Social Security recipients seeking stimulus checks as part of the government's coronavirus response package.
After some misinformation and confusion, the federal government has clarified how Social Security recipients will get their stimulus checks from the coronavirus relief package starting April 17.
The Treasury Department clarified late yesterday that Social Security recipients won’t have to file a tax return to get their stimulus payment, which will instead go out automatically. The IRS will use the information Social Security has on file to distribute the benefit.
This decision comes after an initial announcement from the U.S. Treasury Department that Social Security recipients would have to file a simple tax return for 2019—something they wouldn’t ordinarily do. The IRS now says the payments will be automatic without requiring any filings.
"Social Security recipients who are not typically required to file a tax return ... will receive their payment directly to their bank account,” said Treasury Secretary Steve Mnuchin late yesterday in a statement, noting that recipients will not have to take any further action.
For those who receive their Social Security payment by direct deposit, that’s how they will get their stimulus check too, the IRS said. If you receive your Social Security check in the mail, the benefit will also come that way.
The Treasury Department previously said it would create an online tool that would allow those who don’t have direct deposit information on file with the IRS to update their information with the agency. That tool has not yet been made available.
The change follows pressure from lawmakers who urged the IRS to drop the tax filing stipulation.
According to a letter from three dozen Democratic senators sent earlier this week: "This filing requirement would place a significant burden on retired seniors and individuals who experience disabilities, especially given the current unavailability of tax filing assistance from Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs during the COVID-19 crisis.”
Richard Neal, the Democratic chairman of the House Ways and Means Committee, also pushed for the change. “My colleagues and I strongly urge Treasury Secretary Mnuchin and Social Security Administrator [Andrew] Saul to find a solution that will allow vulnerable groups to receive these funds automatically, without needing to file an additional return," Neal said in a statement.
The $2.2. trillion coronavirus response bill signed by President Trump last week provides onetime payments of up to $1,200 to adults and $500 per child, as well as providing recovery funds for workers and businesses combatting the effects of COVID-19.
The Treasury Department now says that Social Security recipients will have their information taken from SSA-1099 and RRB-1099 forms. That was outlined in the CARES Act that provided for the stimulus payments.