On October 14, a district court in the Northern District of California allowed summary judgment in Scholl vs. Mncuhin, a case that challenged the IRS’s policy of preventing inmates from receiving $ 1,200 stimulus checks. The tribunal also made permanent the preliminary injunction it had published earlier this month, which means the IRS and the Treasury Department cannot withhold stimulus checks solely on the basis of an individual’s incarceration status. The government could still appeal the court’s decision (it was overturned by the 9th Circuit), but the permanent injunction should be a cause for celebration for the more than two million people incarcerated in the United States who can now be eligible for an economic impact payment.
Arbitrary and capricious politics
The case was originally filed on August 1, 2020 in response to the IRS ‘unilateral ruling that incarcerated persons are not eligible for a stimulus check. In a response to a frequently asked question about its Economic Impact Payments clearinghouse, the IRS wrote in May that “payment made to an incarcerated person should be returned to the IRS.” Many jurists have contested the basis for the IRS move, arguing that it acted “beyond his authority, possibly even illegally.” There is no mention of those incarcerated in the CARES Act, which some argue makes the IRS’s position erroneous as it “contravenes the plain text” of the law. according to to Patrick Thomas of the Faculty of Law of Notre Dame.
The district court agreed, discovery IRS policy of withholding stimulus payments “arbitrary and capricious and not in accordance with the law.” He ruled that the IRS was not authorized to withhold payment from incarcerated people only because they are or have been incarcerated. It converted its preliminary injunction, issued on September 24, 2020, to a permanent injunction and gave the IRS and the Treasury Department 30 days from the initial decision to reconsider stimulus payments for people who are entitled to them. based on information the IRS has from 2018 or 2019 tax returns. order for the IRS to reconsider any claim filed through the “non-filing” online portal “or otherwise that has been previously denied solely on the basis of the applicant’s incarceration status.”
The rapid pace of the case and the summary judgment reflected the strength of the plaintiff’s claim and inherent loopholes in IRS policy. “For a case originally filed on August 1, 2020, getting summary judgment in 75 days can make your head spin,” wrote Keith Fogg in a blog post on Procedural taxation. “Rarely does a business evolve so quickly and so favorably. It helps that the IRS took a position not supported by the law and inexplicably reached that position after overturning, ”he added.
How should inmates apply for stimulation control
Inmates and their families need to act quickly, given the looming deadlines for submitting an application and receiving a stimulus check in 2020. Here are some helpful tips based on information from a dedicated page, www.caresactprisoncase.org, set up by Lieff Cabraser Heimann & Bernstein, LLP and the Equal Justice Society. Affected people will find resources as well as a Contact form to contact Lieff’s lawyers, who represent the Plaintiffs and the Group. “If you or your loved one is currently serving a sentence in a state or federal institution or has been recently released, please contact us for more information about your rights by filling out this form,” the site says. “Your inquiries in seeking legal advice are privileged and confidential, and you will not be charged for speaking with us. ”
If you have already filed a complaint before September 24: Many inmates filed a grievance and were either rejected or had their stimulus check intercepted and returned. Based on the court order, the IRS should automatically process your claim again by October 24, 2020. You can check the status of your payment on the IRS portal: www.irs.gov/coronavirus/get-my-payment. If you do not receive the payment before November 1 and do not see it scheduled on the Get My Payment portal, Lieff recommends that you give a hand to one of his lawyers.
If you have filed a 2018 or 2019 income tax return or are collecting Social Security benefits or benefits from the Railroad Retirement Board: You don’t need to file a complaint. The court ordered the IRS to reconsider the stimulus payments if it had any information, including 2018 and 2019 tax returns. The IRS should therefore process your payment automatically by October 24, 2020. As stated above, you should check the status of your payment on the IRS portal and contact a lawyer if you have not received a payment or have seen it scheduled for early November.
If you did NOT file a tax return for 2018 or 2019 and your income was less than $ 12,200 as an individual or $ 24,400 if you filed jointly in 2019: You should file a claim, ideally through the IRS website using its Non-filer tool. You can also file a paper request. Please watch this page for instructions from the IRS. Please Remark that “if you are filing online, the IRS requires that you complete line 9 of the form, in addition to any other required lines (a response to line 9 is not required for paper submissions.)”
If you are submitting a paper complaint, your complaint must be postmarked by November 4, 2020.
If you are filing online through the IRS Non-Filer tool, your request must be filed by November 21, 2020.
The speed of the district court ruling means that up to two million people incarcerated in the United States stand a chance of receiving their legitimate stimulus checks this year. However, they must act quickly given the looming deadlines for filing claims. If you are incarcerated or have a loved one who is, help spread the word and make sure those eligible receive their stimulus.