Tax Refund Direct Deposit Blocked - IRS Says 2 SSNs and HOH at same address

[Steve Stang]

I have a long-standing client who rents in a small apartment building. I filed her return and one for her dependent student son. Both were eligible for refunds. The student was getting back his federal income tax paid ($26). For convenience I had the refunds for both taxpayers directed to mom's savings account. The mother received a note indicating that the son's refund couldn't be deposited because (quoting her email) "the IRS said there was two different head of households with different social security numbers."

I've checked and only the parent was listed as HOH. Son was listed as 'single' and 'dependent of another.'

I'm thinking that because there are six apartments in the building that it's possible that the IRS won't deliver because several taxpayers share the same address.

Every W2, 1099 and official document I have only lists the main house address for both mother and son. So I guess I could have put in unit A or Apt 1 but that's not how it's listed on the documents.

What do I need to do to get the kid his refund? Suggestions?

[DonPriebe]

Sounds funny ...

I'd need to look at that "note" ...

Why would the IRS correspond with the mother about her son's tax return ?

If it's only a direct deposit problem, wouldn't they just send a check?

[Steve Stang]

I have a long-standing client who rents in a small apartment building. I filed her return and one for her dependent student son. Both were eligible for refunds. The student was getting back his federal income tax paid ($26). For convenience I had the refunds for both taxpayers directed to mom's savings account. The mother received a note indicating that the son's refund couldn't be deposited because (quoting her email) "the IRS said there was two different head of households with different social security numbers."

I've checked and only the parent was listed as HOH. Son was listed as 'single' and 'dependent of another.'

I'm thinking that because there are six apartments in the building that it's possible that the IRS won't deliver because several taxpayers share the same address.

Every W2, 1099 and official document I have only lists the main house address for both mother and son. So I guess I could have put in unit A or Apt 1 but that's not how it's listed on the documents.

What do I need to do to get the kid his refund? Suggestions?

The IRS did not respond. Her bank (American Express) indicated that they rejected/didn't accept deposit because of message from the IRS. AmEx indicated directly to the taxpayer via email (I haven't seen it). I'm aware that there was a change to reduce an unlimited number of refunds going to the same address to help cut down on fraud. I had thought I read that this limit was three. So this is what I'm trying to understand: Is there an iRS policy regarding blocking refunds for HOH filers at the same address? And if there is, does the IRS mail to the address of record instead of direct depositing? In the interim, I've advised the client to check the IRS website "where's my refund" to see if it is being mailed instead.

[Steve Stang]

I'd need to look at that "note" ...

Why would the IRS correspond with the mother about her son's tax return ?

If it's only a direct deposit problem, wouldn't they just send a check?

I don't know. That's why I'm asking.

[BP.]

I had the refunds for both taxpayers directed to mom's savings account.

Besides verifying the e-mail and its contents, could this be a source of the problem? Pub 1345 indicates refunds shouldn't go into another person's account.

[Nashville]

Agree with British Petroleum

When filing a return for a child who has no bank account, I ALWAYS leave off direct deposit information. The account MUST be in the name of the taxpayer. If direct deposit information is missing, the return will still e-file, but the govt will mail a paper check to the taxpayer.

[Steve Stang]

OK. I figured a paper check would be mailed.

Live and learn. Don't often deal with too many kiddie accounts.

Funny thing is the message about two 'heads of household' causing the problem.

[David1980]

Funny thing is the message about two 'heads of household' causing the problem.

Yeah, I agree. I'm guessing that got mistranslated somewhere along the way and isn't what really caused the problem, although I could see that kind of checking done for an audit but even then it would affect the people who filed using HOH filing status, not single (and claimed as dependent)?

[taxea]

IRS will only allow direct deposits into accounts with the name of the person the refund is going to. If son is not on mom's account then the IRS will not allow the deposit.