LANSING, Mich. — More than a million people in Michigan have filed for unemployment since the coronavirus pandemic began and wait for federal stimulus checks, but a glitch in the IRS system is keeping some from getting their money.
Several Mid-Michigan residents reached out to FOX 47 and said instead of a direct deposit into their personal bank accounts, their IRS stimulus checks were sent to their tax preparers.
"It was sent out and deposited on the 15th, which was yesterday to the account number with the last 4 digits that I provided to you, and it matches my preparer's account number, not mine," said Jessika Alfonso.
Alfonso says she filed her taxes with the company "Tax Proz" in Lansing and is concerned about the timeline of when she will receive her money.
"Rent is due, bills are due and those kinds of things are not stopping in our mailbox," said Alfonso who is currently not working because of the coronavirus.
The same situation happened to Lansing resident Sarah, who uses the tax service "X-Tax".
"It's not just X-Tax, it's H&R Block, Jackson Hewitt, all of them, anybody that did any kind of rapid refund," said Sarah.
A representative from Tax Proz told FOX 47, the delay is a result of a mistake by the IRS. He said they're seeing it affect tax service customers across the country who received either a tax loan advance within the last year, used a pre-paid bank card for their refund, or received a paper check. Their money was sent to the tax preparer's third-party banks like Metabank and EPS Financial.
"It was a mistake on their side with everything that's going on and this has never happened before, but I talked to EPS Financial and Metabank and all the software people are saying that the money got returned back to the IRS within 24 to 48 hours and those will be changed on the IRS website as a pending check," said Frank, a representative with Tax Proz.
Now customers will have to wait a little longer for their payment relief.
"I'm okay, but I know a lot of people aren't and we have to try to be patient and it's so hard. It's so hard," said Sarah.
Tax expert Andrew Rose, a tax partner at Rehman says the reason the money had to be sent back to the IRS is because tax preparers cannot access or dispense the funds.
"It's in limbo at that point. You gotta wait for the system to kinda catch up for the IRS to realize that they were in error and then again issue a paper check but I don't think that's going to be a super-fast process," said Rose.
Rose says the IRS was likely trying to get money to Americans as fast as possible, using the deposit information they had on file.
Local companies like Tax Proz say they did not know this was going to happen and have been taking calls since to try to explain to customers what happened.
In a statement to FOX 47 MetaBank said:
"This week, MetaBank learned that the IRS is inadvertently distributing some Economic Impact Payments (EIPs) to consumers’ temporary bank accounts with our tax divisions Refund Advantage and EPS Financial. It was an error to send these EIPs to these accounts. The IRS has not explained to us why this error occurred.
These accounts managed by our Refund Advantage and EPS Financial tax solutions only process standard tax refunds owed to taxpayers as a result of a tax filing. As we are required, for EIPs sent to these accounts, upon receipt, MetaBank is immediately sending these EIP payments back to the IRS so that the IRS can distribute directly to consumers.
We are deeply concerned that this error will delay consumers from receiving EIP payments during this difficult time. MetaBank is working closely with our tax refund partners to ensure that they redirect customers to the IRS. As we are expeditiously sending EIP payments back to the IRS, we encourage impacted consumers to contact the IRS directly with questions or for further details."
H&R Block also responded to FOX 47in a statement:
"The IRS is determining when and how stimulus payments are distributed, and H&R Block is processing payments as soon as they are received, including depositing some payments to Emerald Cards. The IRS is sharing where they are sending payments through their tool, Get My Payment, which is available at irs.gov/eip."
Right now there is no exact time on when customers will get their money.
Tax experts estimate a glitch of this kind would take the IRS 7-10 days to fix.
You can check the status of your payment using the Get My Payment App
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