Wrong bank used - anyone else seen this?

[Catherine]

State issue at the moment - we're waiting for the federal shoe to drop. Client contacted me that she got an NSF notice from her bank on state tax payment.  Wrong bank!  Not the one we sent in (and I have the signed authorization with the right bank's information in my files), but rather the bank she used last year for dirdep of her refund.

Never seen this in 30 years.  Have any of you seen this, this year or any other year?

I've told her to check both accts online to see if the feds got it right. Or not.

[jklcpa]

Never seen it either. How did that happen?

[Abby Normal]

1 hour ago, jklcpa said:

Never seen it either. How did that happen?

Very old computers at the IRS.

[jklcpa]

21 minutes ago, Abby Normal said:

Very old computers at the IRS.

Catherine said this started as a state issue though.

[Lion EA]

On another board not many days ago, a client who always uses/receives checks for income tax purposes, had a direct debit/deposit (can't remember which) this year without any banking information on her return. Client's on SS, so SSA would have her DD info. But the IRS?!

And, was it here or another board, where the direct debit/deposit (think this was a deposit) landed in the taxpayer's business account instead of their joint account listed in their joint return? Don't think the accounts were even at the same bank.

[Abby Normal]

Sounds like Social Security is sharing bank info with the IRS and since direct deposit is used for all Social Security payments, I don't blame the IRS for forcing direct deposit on those folks. It must save the IRS a ton of money printing, stuffing and mailing checks, and time tracing lost checks or fraudulently negotiated checks.

[Abby Normal]

53 minutes ago, jklcpa said:

Catherine said this started as a state issue though.

Yes, but it sounds like both states and the feds are moving to direct deposit/direct debit only. And I approve.

[jklcpa]

Just now, Abby Normal said:

Yes, but it sounds like both states and the feds are moving to direct deposit/direct debit only. And I approve.

So do I, and the current filing should update banking info in the states' and federal systems. 

[Catherine]

She was able to fix it with the state (and got the penalty waived by the state; dunno about the bank yet).  She has not yet checked with the federal payment. We still have absolutely no idea how the new bank info did not get utilized, since it was indeed sent. 

[Terry D EA]

It will be interesting to see the final outcome of this. Don't know about MA, but NC will immediately charge 10% of the tax due as an NSF fee and a few years ago they were going to charge a client $100.00 NSF fee when I was trying to get them to intercept or stop a draft that hadn't occurred yet. So good thing your client got the State issue resolved. If it means anything, I contacted the EFTPS folks last week for a client who gave the wrong bank account number. They were very cooperative and stopped the draft immediately. I found it odd, those folks are there around the clock but glad they were.