ABC11 in Durham, NC is reporting some mishaps with the initial set of direct deposits for the 2020 Coronavirus Economic Stimulus Bill.
Each adult is eligible to receive up to $1,200 USD and child $500 USD.
A family of three making under $150,000 a year in tax year 2018 or 2019, would receive $2,900 ($1,200 + $1,200 + $500).
What if Bitcoin was used instead of fiat?
The other question is how could have crypto as a form of payment been any more successful is getting payments out.
1) the transaction fees associated with sending out so many transactions in a short period of time would mean payments would be hard to scale. If you used Bitcoin, the transaction fees even with the recent purchases with the dip to $4,500 shows the transaction fees for all these unique addresses would not have scaled well at all.
2) the time to deposit would only take 6 confirms for Bitcoin and the ability to spend would have been much quicker. The deposit could take an entire day and show as pending. If payment was sent on a Friday, it might take even the weekend for funds to clear. That depends entirely on the bank and how payments are sent, but it is a possibility. So, in that respect crypto wins for being able to spend the funds quickly.
3) if payment was sent to the wrong account, there’d be a way to reverse the deposit. Bitcoin is permanent.
Should the IRS have taken more time to validate the account information?
Would it have been better for the IRS to validate the direct deposits to be more accurate, or was this best to get payments to people as quickly as possible?
Some potential issue I see if you don’t do some exception analysis with direct deposits:
- filed jointly in 2018/2019 and spouse is deceased
- couple is divorced? join in 2018, single file in 2019?
- dependents no longer dependent (deceased, filing individually, etc)
- direct deposit went to wrong account (wrong account number, tax preparer’s bank account, etc)
- bank account closed
It makes you wonder if the IRS could have done anything differently and still pay American taxpayers quickly.