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First Stimulus Checks Have Been Delivered and what a MESS

Date: April 15, 2020

Author: Michael Brown

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This is a first of its kind, massive use of direct deposits for non-regular receivers of government money.  Can you even believe the government would roll out this program without even testing a small batch of checks first to see what issues would surface? When it worked, it worked really well. For example with folks who were already receiving their social security checks via direct deposit. 

In the world of mass market taxes, clients frequently pay their tax preparation fee by taking the fees out of their refund using a 3rd party bank. These "cyber" accounts are designed to be one-time use accounts. In goes the IRS and State refunds. Checks get printed at the tax offices. Client pick up checks there.  When it was announced that stimulus checks would be direct deposited if you direct deposited your refund, clients immediately called to see if our offices would be handling their checks.  We didn't know the answer and had to tell them to wait and see.

The banks, when they heard about the direct deposit plan, got together with the IRS last Friday to discuss whether these one-time use accounts would receive the stimulus checks.   The banks basically told the IRS that they can't have the liability of being its middle man. 

Now very happy tax payers received notice that their stimulus was direct deposited...EXCEPT...the 3rd party banks returned the checks back to the IRS and these very happy tax payers aren't very happy anymore.  No one knows how long it will take to reissue and resend or redeposit these checks.  This is just another example of how the White House doesn't understand how regular Joes live their lives.  There are millions of people who receive their refunds this way.

Tax payers are supposedly going to be able to input new direct deposit information on the new IRS direct deposit portal....only thing is the portal tells the tax payer that they have already received their check.  We are telling our clients to wait a couple of days.  The IRS probably hasn't had time to program what to do in this situation that could have been solved with a basic small-batch beta test.

This is a classic example of attention to the small details missing in this administration. It seems no matter what they implement policy-wise, it is never executed well. As an executive who has had to execute some very expensive, complex programs, I can tell you an idea is only as good as its execution. Truth matters. Attention to detail matters. Fully developing programs from the headline to the fine print matters.

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