Some stimulus money is being incorrectly sent to dead people. What happens to that money?

$290 billion worth of direct cash is being distributed by the IRS, as mandated by last month's $2 trillion CARES Act passed by Congress. While a huge chunk of Americans wait to get theirs, reports across the country claim stimulus checks are being sent to the deceased.

NBC reports a few cases:

Jeanne Syracuse from Northern Virginia didn't know what to do when $1200 was deposited in her deceased mother's account, who had died last August.

"We don't want it. It's not who the stimulus was supposed to benefit."

In Florida, Erin Kurinski's mother received the $1200 stimulus as expected, as well as an extra $1200 for her husband, who died in May 2019. Kurinski spoke for her mother, "She doesn't know what to do with it. I said, 'Mom, just leave it there, they'll take it back someday. She doesn't even need the $1,200. She said, 'Someone else could use it more than I could.'"

One reported case came from Representative of Kentucky Thomas Massie:

Ok this is insane, but just the tip of the iceberg. This is a direct text to me from a friend. I called to confirm this actually just happened. pic.twitter.com/GBRPcmYMXW

— Thomas Massie (@RepThomasMassie) April 15, 2020

Anecdotes like these are springing up on social media:

@IRSnews My deceased uncle received a $1200.00 stimulus check deposited to his account this morning. We filed taxes for him, but he passed in February. What do we do with this? I've saw a blog where this happened to other people. Please advise us what to do with this money.

— David McCrory (@Weezy_Johnston) April 15, 2020

I was widowed in March 2019. I filed my 2019 as married filing jointly and that my husband was deceased. I just received $2400 from the stimulus package... what happens to widows like me who are getting the $2400? Will they want the $1200 back? #widow #IRS #COVID19 #coronavirus

— Shannon (@MsPrincessShann) April 15, 2020

How does this mistake happen?

The relief package was cobbled together quickly to address an immediate problem. It was calculated using taxpayers' 2019 tax filings (or 2018 taxes or income if 2019 wasn't filed) to determine who was eligible for how much aid. Ryan Ellis, a tax lobbyist and preparer, told NBC: 

"There is an inverse correlation between speed and accuracy. We wanted these fast. Accuracy is necessarily de-emphasized. We could have had it accurate and slow, or less accurate and fast. In a crisis, it's a no-brainer to pick the latter."

This isn't the first time this has happened—the American Recovery and Reinvestment Act of 2009 gave $18 million of its $13 billion in stimulus to the deceased.

What happens to the money?

Some news outlets assume that the family of the deceased gets to keep it. Others advise the best course of action is to keep the money in the bank and wait to see.

The CARES Act specifically states that you can keep extra funds you receive if your stimulus check is too large, but that isn't exactly the case here—the stimulus package was never meant for now-deceased taxpayers.

But according to one administration official, the stimulus bill as written may actually authorize payments to the recently-deceased, if they would have qualified for the stimulus in 2019.

Even if the payments to the deceased are illegitimate, however, there is no explicit provision in the law to reclaim the money, and an audit over $1200 doesn't seem economical. A Treasury spokesperson declined to comment on the matter but said that information would be forthcoming soon.

Has this happened to any families you know? What do you think should happen with the checks paid to the dead?

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