Corona Daily 407: Afterlife benefits

This week, USA showed itself to be the greatest welfare state - it provides for its citizens even in the afterlife.

As a measure of pandemic relief, a total of $1.4 billion was distributed among 1.1 million dead Americans. Some widows received two debit cards, one in the name of their late husbands. Certain politicians brushed it off as an error, mitigated by the coronavirus shock and the speed with which the stimulus needed to be delivered.

This same nation, in a matter of hours, had published the photos and biographies of the 19 terrorists despite four plane crashes vaporizing all passengers beyond recognition.  USA can’t send debit cards and checks to 1.1 million dead people by mistake, and it didn’t. On 25 June, GOA (Government accountability office), the watchdog, published a 400 page-report that includes analysis of this incident.

USA is mostly run by three-letter abbreviations. IRS (Internal Revenue Service) is the tax collector. BFS (Bureau of fiscal service) sent people the stimulus checks. Both these services are part of the Treasury. SSA(Social security administration) is an independent agency that holds the database of more than 125 million dead Americans.

IRS, the tax collector, can access the SSA’s Death Master File. BFS, the stimulus payer, can’t. When the government decided to make the EIP (Economic Impact Payments) of $1200 to Americans below a certain income level, IRS lawyers discussed the recipients’ eligibility. They determined IRS can’t deny payments to those who have filed tax returns for 2019. Once they file the tax return, they are entitled to the stimulus, even if dead.

BFS was under pressure to dispatch checks and debit cards as rapidly as possible. It had no access to death data. IRS would not give them that access, unless Congress approves it. And Congress was in lockdown. BFS decided to refer to the 2008 textbook. Americans are exceedingly fortunate the last two great crises happened in election years. George Bush in 2008 and Donald Trump in 2020 were in a hurry to help. A school child could have applied a death filter (if IRS had allowed it), and all 1.1 million Americans would have fallen off. However, such a filter was not applied in 2008. So BFS decided not to apply it this time.

Many checks carried the printed word ‘deceased’ after the name of the late citizen. $1200 was sent either by direct transfer, checks or debit cards. A son could easily spend on the debit card given to his late father.

Once the auditors began probing, the Treasury, IRS and its lawyers got together hurriedly. After a stormy video discussion, lawyers agreed the receiving person must be alive on the date payment is made. Steven Mnuchin, the Treasury secretary said heirs of the dead should return the funds.

To be legally correct, IRS should notify a citizen about his ineligibility. You are a nonresident alien. Not eligible. You are in prison. Not eligible. You are dead. Not eligible. Notifying the dead is a legal complication. It is simpler to pay them off. Legal experts are now debating whether the descendants are required to return the money.

The watchdog has now recommended Congress should approve giving Treasury access to the death files. Once that happens, unfortunately, Americans will lose their afterlife benefits.

Ravi