The IRS said Wednesday that incarcerated individuals do not qualify for the coronavirus relief payments created by legislation President Trump signed in late March.
“A Payment made to someone who is incarcerated should be returned to the IRS,” the agency said in an update to its frequently asked questions webpage about the payments.
In cases in which a payment was made to a married couple where only one spouse is incarcerated, only the amount for the incarcerated spouse, typically $1,200, needs to be returned, the IRS said. The agency’s webpage does not mention payments for the children of incarcerated individuals.
The $2.2 trillion coronavirus relief package enacted March 27 directs the IRS to issue one-time payments to most Americans of up to $1,200 per adult and $500 per child. The agency said last week that it has already delivered more than 130 million of the payments.
Taxpayers have had many questions about the payments, and the IRS has been providing more and more guidance about them over time to address questions that have arisen.
In addition to saying Wednesday that incarcerated individuals don’t qualify, the IRS said in its updated FAQs that payments should be returned if they were made to someone who died before the payment was received. This portion of the guidance is in line with comments Treasury Secretary Steven Mnuchin made to The Wall Street Journal last month, when he said that payments sent to dead people should be returned.
The IRS said that the full payments sent to dead people should be returned, except in cases in which a payment was made to joint tax filers and one of the spouses is still living. In those cases, only the payment amount for the deceased spouse, typically $1,200, should be returned.
The IRS provided instructions about how direct payments can be returned to the agency, along with addresses where returns can be sent, depending on the state where the taxpayer lives.
People can return paper checks by voiding them and mailing them to the IRS along with a note explaining the reason for the return.
In cases where paper checks have been cashed or payments were made by direct deposit, people should write a check or money order to the U.S. Treasury and include “2020EIP” and the taxpayer’s Social Security number or individual taxpayer identification number. The check or money order should be mailed to the IRS along with an explanation for returning it.