Seems on this round someone in Congress stuck in something about that….
It wasn’t there for the $1,200 checks the first time and we won’t know if the Biden checks will have the same limits…..
Millions of people who owe taxes and other money to the government are seeing their economic stimulus payments cut or wiped out to cover the debts because Congress peeled back a protection that had been in place for months.
The cuts may be particularly hitting those most in need of relief money because of the coronavirus pandemic, including veterans, Social Security recipients and students.
Congress had shielded previous payments from being rerouted for those types of things, except for unpaid child support, but moved the goalposts at the end of December, when it approved another round of stimulus payments of up to $600 per person.
Most of those payments went directly to households, through direct deposits or paper checks, and their money can’t be redirected.
But millions of others who didn’t get direct payments need to file tax returns this year and claim a recovery rebate credit, or RRC, to receive the stimulus money. Some 8 million households are in that boat, according to a recent Treasury Department estimate, and a good share of them might not get the credit because Congress directed the IRS to instead steer the money to cover various debts, National Taxpayer Advocate Erin Collins said.
That’s a reversal of policy from last March, when the initial round of stimulus payments went out with explicit instructions against rerouting the money to cover outstanding debts except child support.
The reason for the change is so far unknown.
Collins, who flagged the problem in a blog Thursday, said the IRS could fix it, at least for those who have federal tax debts. She suggested the agency use authority it has to bypass refund reductions for those who are experiencing economic hardship….