Nearly four million people are being sent their Economic Impact Payment by prepaid debit card, instead of paper check, the Internal Revenue Service announced last week.
The announcement comes as a result of an interpretive rule issuance from the Consumer Financial Protection Bureau (CFPB) clarifying that coronavirus relief payments will not be considered “government benefits” and can be issued as prepaid cards, as a result. The CFPB has issued a FAQ page with more information.
The determination of which taxpayers receive a debit card was made by the Bureau of the Fiscal Service, another part of the Treasury Department that works with the IRS to handle distribution of the payments. A Treasury announcement indicates EIP Cards are being distributed to qualified individuals without bank information on file with the IRS and had their tax return processed by either the Andover or Austin IRS Service Center. However, we have had clients reach out that have had their returns processed through Hartford that have received the cards.
These Economic Impact Payment Cards arrive in a plain envelope from Money Network Cardholder Services. The Visa name will appear on the front of the card; the back of the card has the name of the issuing bank, MetaBank®, N.A. Information included with the card will explain that the card is an Economic Impact Payment Card.
Those who receive Economic Impact Payment by prepaid debit card can do the following without any fees:
- Make purchases online and at any retail location where Visa is accepted
- Get cash from in-network ATMs
- Transfer funds to their personal bank account
- Check their card balance online, by mobile app, or by phone
This free, prepaid card also provides consumer protections available to traditional bank account owners, including protection against fraud, loss, and other errors.
Please reach out to firstname.lastname@example.org with questions.
We are in this together,
Brinker Simpson & Company, LLC
Disclaimer: This alert is for informational purposes only and does not constitute professional advice. Information contained in this communication is not intended or written to be used as tax advice & cannot be used by the recipient to avoid penalties that may be imposed under the Internal Revenue Code. We strongly advise you to seek professional assistance with respect to your specific issue(s).