In the rush to send out stimulus payments, the Internal Revenue Service (IRS) made payments to some individuals who should not have received one. There are numerous reports of payments made to those who are in jail, are deceased, are undocumented immigrants, are U.S. nonresidents, and who could be claimed as a dependent on another person’s tax return. The IRS has posted instructions for how to return the erroneous payment under Question 41.
At present, it is unclear how the IRS will eventually recoup the erroneous payments or when any action would be taken. Nevertheless, it is advisable to return the erroneous stimulus payment voluntarily.
In summary, the instructions state to either return the uncashed paper check, or to write a personal check to the U.S. Treasury. The check should be accompanied by a brief note explaining why the payment is being returned. Though not required by the IRS, we recommend that any payments should be mailed certified or in any other matter that provides proof of delivery. Mailing addresses are dependent on the state of residence and are listed under Question 41.