Last week I shared that the IRS had announced the launch of a new website, Get My Payment, expected to be ready by April 17th, to provide information about the amount of a taxpayer’s Economic Impact Payment, the scheduled date for the payment, and the manner in which the payment would be made (by check or direct deposit).

In an unusual feat of over delivery, the IRS beat its estimate, and the new website became available on April 15th, two entire days early.

This unexpected availability delighted millions of taxpayers. who could not think of a better idea than suddenly flocking to the site, to anxiously check on the status their payment, only to…… immediately crash the website.

Oh well!

I still give the IRS an A+ for effort.

Another very common problem experienced last week, was that a lot of people got this answer about their EIP:

Not very helpful, right?

Apparently, one of the reasons why the site crashed or provided the above unhelpful answer, is that the IRS operates on old legacy systems written in a programming language called COBOL, developed in…. 1962!!!, and, which, unsurprisingly, is not very flexible.

Another challenge for the IRS with this site, on top of working with a workforce that has been reduced by close to 24% since 2011, is that the different IRS databases that feed it don’t talk well to one another, because they speak ancient COBOL.

In the rush to get the website out quickly, certain outliers, or less common taxpayer situations, were not able to be accounted for in the programming of the site. If you are one of the unlucky people in those less-common-situation groups, you will get the PAYMENT STATUS NOT AVAILABLE answer.

I anticipated that taxpayers with foreign addresses may not be able to use the new site. I haven’t received any feedback about this particular situation, but with more than 155 million tax returns filed with the IRS last year, and less than 2% filed from overseas, a foreign address may very well be one of those outliers not accounted for in the site’s programming.

The lack of information on the site should not impact the delivery of your EIP, as long as you are eligible, of course. The site’s FAQs section should provide additional information to help you understand the reasons why your EIP status is not available through the site.

Rollout of the Economic Impact Payment

Last week we also saw the rollout of the first batch of Economic Impact Payments, with the first 80 million payments delivered in the first week. Did you get yours?

80 million is a much larger number than the 5 million/week check capacity we mentioned in last week’s Crossborder Planner. This is because most of the 80 million payments that were made last week, were done by bank deposit. It’s the checks that take time to print and will take much longer to be distributed.

The IRS can process bank deposits a lot faster than checks, which is why it is encouraging taxpayers to provide their bank information via the Get My Payment site, to allow for a faster distribution.

 A few issues with the EIP

  • In some cases, the IRS used the taxpayers’ 2018 tax return AGI to calculate the payment, even though the taxpayer had already filed their 2019 tax return.
  • It appears that the cutoff date for 2019 tax returns to be considered for EIP calculations was February 29th, before the CARES Act was passed.
  •  If you filed your 2019 tax return in March or later, the IRS will likely use your 2018 AGI to determine EIP eligibility.
  • It won’t help you to file 2019 now, if your 2018 AGI is too high for the EIP. You will need to wait and see if you qualify based on your 2020 income, and instead, get your EIP when you file your 2020 tax return.
  • If your bank account changed since you filed your last return, unfortunately, you won’t be able to update your bank information online, and you will eventually receive the payment by check, after the bank rejects the deposit.
  • Checks will be mailed overseas, but they may not arrive in a timely manner, if at all, depending on the reliability of the postal service of your country of residence.
  • If you know you will get a check, and you have moved since you filed your 2018 (or 2019, when relevant) tax return, try to set up mail forwarding to avoid missing your check.
  • In an interesting twist, some taxpayers who died in 2018 have been issued EIPs.
  • And most qualified children born in 2019, and even some born in 2018, have erroneously not been issued their payment

        If there are errors in your EIP calculation, it will difficult to get them corrected before you file your 2020 tax return. The IRS will provide a method for EIP reconciliation on the 2020 tax return that should allow the correction of any underpayments. It’s not ideal and it doesn’t help you today, but it’s unlikely that a different solution will become available before then.

Until the next post!

Marina