TurboTax, H&R Block blame IRS for stimulus mix up

RALEIGH, N.C. (WNCN) — TurboTax and H&R Block are trying to explain why stimulus payments to thousands of people ended up being sent to the wrong accounts. They claim it’s the fault of the IRS.

“I don’t know where TurboTax went wrong,” said CBS 17 viewer Michael Wade who is among those waiting for his stimulus money.

He and many others found their payments were not going to come to them because of the way the funds were distributed by the IRS.

That money went to third party bank accounts used by firms like TurboTax and H&R Block to collect filing fees for income tax preparation.

“Those accounts are opened up on a temporary basis so as soon as they serve their purpose those accounts are closed,” said Mark Ferrill of LibertyTax.

He said the IRS sent the stimulus payment to those temporary accounts instead of to people’s individual bank accounts for direct deposit.

Since the accounts were closed, those banks returned that money back to the IRS.

Both TurboTax and H&R Block have sent letters to their customers trying to explain what happened to their missing funds.

Both companies blamed the IRS for the problem, saying it was that federal agency which determined where the money would be deposited.

“It’s a shame they were not able to pull this off,” said Wade.

On Wednesday, CBS 17 Consumer Investigator Steve Sbraccia sent an e-mail to TurboTax asking the company for an interview to explain what was going on — for example when people might see their money. The company did not reply.

However, in its letter to customers, TurboTax said it expects the error will be corrected “within days” and that the “IRS now has the correct banking information.”

But, that doesn’t sit well with people like Brittany Malley who need the cash and don’t know when the money will arrive.

‘The government’s willingness to give you help in any way they can, but then to realize you may not even get it when you’re eligible for it, it hurts,” said Maley.

She said it’s especially hard when you count on that money.

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