H&R Block, TurboTax customers outraged after stimulus money sent to inactive bank accounts

BOSTON — H&R Block and TurboTax customers across the country are outraged and confused by a glitch that sent many people’s long-awaited stimulus checks into inactive bank accounts.

The IRS began sending out the second round of economic impact payments – worth up to $600 for individuals and each of their child dependents – over the past week.

Millions of Americans were supposed to receive that money on Monday via direct deposit.

As of Tuesday night, irate customers of both tax preparation giants were still left wondering when they’d be seeing the money in their accounts.

Boston 25 News learned that the IRS potentially sent some of the stimulus payments to temporary “pass-through accounts” set up by the companies in previous years.

That caused some people to see their money appear in accounts they didn’t recognize when they checked the IRS’s “Get My Payment” tool.

“You keep calling the 1-800 H&R Block number, and it keeps hanging up on you,” said David Foley, a father of four who lives in Wilmington. “My car payment’s not waiting. All the bills you have to pay, they don’t care where the money is.”

An H&R Block spokesperson told Boston 25 News that the company is still working to resolve the confusion.

“The IRS determines where second stimulus payments were sent, and in some cases, money was sent to a different account than the first stimulus payment last spring. We immediately deposited millions of stimulus payments to customers’ bank accounts and onto our Emerald Prepaid Mastercard® yesterday, and all direct deposits are being processed,” the company said in a written statement.

The explanation is not sitting well with those who are still wondering when they’ll be seeing the money in their accounts.

Some customers are questioning if the tax-preparation companies are somehow acting as stimulus middlemen – receiving the money and then deciding how it will be delivered.

“It’s been an absolute nightmare. We were looking forward to just a little bit of relief,” said Gregory Roy, a father of a 4-year-old old who lives in Burlington. “I’m just left crushed again.”

H&R Block said it’s still unclear why some federal funds were deposited into a refund transfer account – usually set up for transferring tax refunds.

TurboTax sent Boston 25 a statement saying its up to the IRS.

The IRS is the sole party with the ability to determine eligibility and distribute stimulus payments.

As part of the income tax filing, the IRS receives accurate banking information for all TurboTax filers who receive a tax refund, which the IRS is able to use to deposit stimulus payments. According to the IRS, “because of the speed at which the IRS issued this second round of payments, some payments may have been sent to an account that may be closed or no longer active. By law, the financial institution must return the payment to the IRS, they cannot hold and issue the payment to an individual when the account is no longer active.” While the IRS is exploring options to correct their issue, they have stated that this may cause a delay in stimulus payments for some.

—  TurboTax spokesperson

The IRS has still not formally commented on the issue. In a news release sent on Monday, the IRS warned that some payments may have been sent to closed or inactive accounts because of how quickly the agency moved to distribute the money.

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