Stimulus Update: 5 Surprising, Little Known Facts About Stimulus Checks

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KEY POINTS

  • Most of us have never lived through a crisis like COVID-19 before. Given the scope of the problem, it's no surprise that some mistakes were made.
  • Billions of dollars were sent around the globe to help Americans weather the storm.
  • As stimulus was distributed, millions of homeless Americans appear to have fallen between the cracks.

The most we can hope for is to learn what worked (and what did not work) when the government began cutting checks.

Throughout the COVID-19 pandemic, the American government sent out multiple rounds of stimulus checks to its people, first under the Trump administration, and then with the most recent coming under the Biden administration. There's no doubt those stimulus checks had a large impact on all walks of life, from the young to the elderly, the single to those with large families. Here, we'll take a look at five lesser-known facts about those stimulus checks that Americans received.

1. Check recipients had 365 days to cash their checks

Most stimulus checks were sent as electronic transfers to bank accounts, but when the IRS did not have a recipient's direct deposit information, it mailed a paper check. Like all payments checks sent from the U.S. Treasury, if those checks are not cashed within one year, they expire.

There's good news, though. You can request a new one if you have a check that expires. Here are the steps you'll need to take:

  • Write "void" on the back of the check (where it would typically be endorsed)
  • Write a short note to the IRS explaining that the check is being returned because it's expired. Request that the IRS reissue the check and mail it to you. Provide the IRS with your current mailing address and telephone number.
  • Look at the front of the check. Located on the bottom, before the words "Tax Refund," will be the name of a city or an abbreviation for a city. For example, if you see the letters KANS CY, that stands for Kansas City. Make a note of the city because you'll need it to mail the check.
  • Do not staple, bend, or otherwise attach the check to the letter. Place the letter and check in an envelope for mailing.
  • Check this page on the IRS website. You'll find a list of 10 cities near the bottom of the page. Next to the city listed on your stimulus check is the IRS address you need. If you're unsure, contact the IRS by calling (800) 829-1040 to ask for the correct address for returning a check.

2. The rule was "finders keepers"

Let's say the stimulus check sent was larger than you qualified for. For example, if you earned more in 2020 than in 2019, but the IRS based your payment on your 2019 tax return, the amount you were overpaid is yours to keep.

The only time the government asked for funds back was when a check was made out to someone who had passed away in 2019 or earlier.

3. Prisoners were included

When COVID-19 relief bills passed, there was nothing in the law about which American citizens could receive the funds. But in May 2020, the IRS decided that incarcerated individuals did not qualify for stimulus checks. A class action suit was filed on behalf of prisoners, and a federal judge ruled that the federal government could not deny stimulus funds to citizens simply because they were incarcerated.

In the end, incarcerated Americans received an estimated $783 million in stimulus relief. The precise amount has become muddied by political infighting over the issue, with far-right news organizations insisting the number is much higher.

4. Billions sent over the deep blue sea

Approximately 9 million U.S. citizens live overseas (including U.S. territories). Stimulus payments worth $5.5 billion were sent to more than one-third of those expats, soldiers, and world travelers. How they used the funds was up to them.

5. Some of the neediest missed out

The homeless were the most likely Americans to miss out on stimulus funds. According to ProPublica, as many as 12 million Americans eligible for stimulus payments never received one. Due to the nature of homelessness, millions did not have an address or bank account the IRS could use. Further, many homeless people do not earn enough to file a tax return, the document the IRS used to determine payment.

Making the issue even more tragic is the fact that stimulus funds could have helped homeless people save enough to rent an apartment or pay for the food they need to survive.

Most Americans have never lived through anything quite like a global pandemic. As we look back, we're sure to identify things that were done correctly and things that didn't work out as planned. Hopefully, the next time we're faced with an emergency of this magnitude, we'll use what we learned from the COVID-19 crisis to help make it through.

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