The voices of Tax Policy Center's researchers and staff
The IRS has done an impressive job delivering over 80 million rebate payments authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. But a number of Americans may not get the much-needed cash payments because they have no way to update their addresses or bank account numbers for the IRS. There is an easy solution: The federal government could set up a secure telephone line for people to call in their information.
The IRS has sent out payments to millions of households that provided direct deposit information on their 2018 or 2019 income tax returns. And the IRS is now embarking on sending checks to people who did not provide direct deposit information on their income tax returns. It is also preparing to send payments to many others receiving government benefits from Social Security (including Supplemental Security Income) and the Veterans Administration. But that still leaves out some people who were not required to file an income tax return and others for whom the government doesn’t have enough information to send an accurate payment.
The IRS has created web applications to address some of these situations for those with internet access. But that still leaves many households with no way to communicate with the tax agency.
With libraries and other government buildings closed in many jurisdictions, access to the internet is more limited now than usual. Overall about 10 percent of the population lacks access the internet. Nearly 44 percent of households making less than $30,000 a year don’t have broadband internet access, and thus are unlikely to communicate with the IRS via the recently-deployed web applications.
The IRS has closed its taxpayer assistance offices, so in-person help is unavailable. In more normal times, about 1.3 million low-income families rely on Volunteer Income Tax Assistance (VITA) sites to file their tax returns. But those sites are shuttered too.
But the IRS could use a simple system, modeled on the way cash payments have been delivered by other agencies in times of crisis: Set up secure telephone lines.
M.A. Sheehan, Program Director at the New Orleans Lower 9th Ward Homeownership Association called me with the idea. She told me that the ability to update information via telephone is the missing link for many of her clients, including low-income childless workers who are largely detached from the tax system and who also lack internet access.
The Federal Emergency Management Agency (FEMA) set up such secure lines in places like Tennessee, where it is distributing cash assistance to victims of recent tornadoes. If the IRS can’t work with FEMA to establish these telephone services, it could authorize and provide funding for VITA sites to communicate with clients by telephone. Just as with all types of rebate claims, the IRS would need to be vigilant with respect to potentially fraudulent payments.
The IRS has done a good job identifying individuals who are eligible for the coronavirus payments, particularly by expanding who can receive payments automatically. But it won’t find everyone. And at a time like this, the IRS should make every effort to find people who are disconnected from both the income tax system and the internet.
Posts and comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.
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Al Drago, The New York Times/AP Photo