IRS Provides Update on EIP Program
The update includes information on payments sent to incarcerated individuals, non-resident aliens, or those who died before the payment was received.
The Internal Revenue Service (IRS) provided an update on the first four weeks of the Economic Impact Payment (EIP) program progress and advised that individuals who are incarcerated, non-resident aliens, or who died before the payment was received are not entitled to the Payments.
The payment figures released by the Treasury and IRS show that during the first four weeks of the program, approximately 130 million individuals received payments worth more than $200 billion. Regionally, over 5 million payments were issued worth almost $9 billion.
The IRS also updated the Economic Impact Payment Information Center with instructions for returning Economic Impact Payments, as well as information regarding payments that were sent to deceased, incarcerated, or non-resident aliens.
- Does someone who has died qualify for the Payment?
- No. A Payment made to someone who died before receipt of the Payment should be returned to the IRS by following the instructions in the Q&A about repayments. Return the entire Payment unless the Payment was made to joint filers and one spouse had not died before receipt of the Payment, in which case, you only need to return the portion of the Payment made on account of the decedent. This amount will be $1,200 unless adjusted gross income exceeded $150,000.
- Does someone who is a resident alien qualify for the Payment?
- A person who is a non-resident alien in 2020 is not eligible for the Payment. A person who is a qualifying resident alien with a valid SSN is eligible for the Payment only if he or she is a qualifying resident alien in 2020 and could not be claimed as a dependent of another taxpayer for 2020. Aliens who received a Payment but are not qualifying resident aliens for 2020 should return the Payment to the IRS by following the instructions about repayments.
- Does someone who is incarcerated qualify for the Payment?
- No. A Payment made to someone who is incarcerated should be returned to the IRS by following the instructions about repayments. A person is incarcerated if he or she is described in one or more of clauses (i) through (v) of Section 202(x)(1)(A) of the Social Security Act (42 U.S.C. § 402(x)(1)(A)(i) through (v)). For a Payment made with respect to a joint return where only one spouse is incarcerated, you only need to return the portion of the Payment made on account of the incarcerated spouse. This amount will be $1,200 unless adjusted gross income exceeded $150,000.
NACHA has updated their FAQ regarding how an RDFI should handle an EIP to the account of a customer that is deceased, incarcerated, or a non-resident alien.
Question of the Week
Q. Our member lost his ATM card sometime in the last 10 days. There have been several unauthorized transactions on his account. He wrote his PIN on the back of the card. Do we have to credit his account with the money, even though he was negligent?
A. Unfortunately, Reg E does not have a provision for consumer negligence, even if the PIN was written on the card. If a member reports a card lost or stolen within two business days of learning of the loss or theft, the member is liable for a maximum of $50. The liability can increase to $500 if the loss is reported after two business days. The member may have additional liability if the loss or theft goes unreported, and the member does not report the unauthorized activity within 60 days of receiving their periodic statement.
National Credit Union Administration (NCUA)
NCUA Changes Low-Income Designation to Include Military Personnel in Calculation
Under the new approach, military personnel will now be considered in a similar manner as students attending colleges, universities, vocational or technical schools when the NCUA evaluates federally insured credit union’s low-income designation.
Interagency Guidance on Credit Risk Review Systems
The NCUA issued interagency guidance which discusses sound management of credit risk, a system of independent on-going credit review, and appropriate communication regarding the performance of the institution’s loan portfolio to its management and board of directors.
Interagency Policy Statement on Allowances for Credit Losses
The NCUA issued an interagency policy statement on the allowances for credit losses (ACLs). The policy statement describes the measurement of expected losses under the current expected credit losses (CECL) methodology and accounting for impairment on available-for-sale debt securities.
Consumer Financial Protection Bureau (CFPB)
CFPB Issues Final Remittance Rule
The CFPB released a final rule covering remittance transfers. The Rule allows credit unions to continue to provide estimates of the exchange rate and certain fees under certain conditions.
Financial Crimes Enforcement Network (FinCEN)
FinCEN Reissues Real Estate Geographic Targeting Orders for 12 Metropolitan Areas
FinCEN announced the renewal of its Geographic Targeting Orders (GTOs) that require U.S. title insurance companies to identify the natural person behind shell companies used in all-cash purchases of residential real estate. The metropolitan areas in the GTO include Seattle.
U.S. Equal Employment Opportunity Commission (EEOC)
EEOC Delays EEO Data Collections Due to COVID-19 Public Health Emergency
The EEOC will delay the anticipated opening of the 2019 EEO-1 Component 1 data collection and the 2020 EEO-3 and EEO-5 data collections due to the COVID-19 emergency. The EEO-1, EEO-3, and EEO-5 filers should begin preparing to submit date in 2021.
Internal Revenue Service (IRS)
Coronavirus-Related Relief for Retirement Plans and IRAs Q&A
The IRS released a series of questions and answers related to Section 2202 of the CARES Act, which provides for special distribution options and rollover rules for retirement plans and IRAs and expands permissible loans for certain retirement plans.
IRS Releases Latest State-by-State EIP Payment Figures
The IRS released updated state-by-state figures for the Economic Impact Payments, with approximately 130 million individuals receiving payments worth more than $200 billion in the program’s first four weeks.
Office of Foreign Assets Control (OFAC)
OFAC has updated the SDN list as of May 7. The last update prior to this was May 1.
Questions? Contact the Compliance Hotline: 1.800.546.4465; [email protected].