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Prison in California. (Photo: CCPOA screen capture)

California District Court Judge Rules Prisoners are to Receive Stimulus Checks

Treasury Department, IRS vow to appeal ruling

By Evan Symon, October 12, 2020 6:41 pm

On Monday, Judge Phyllis Hamilton of the U.S. District Court for the Northern District of California ruled that denying incarcerated prisoners stimulus checks is unlawful, paving he way for prisoners to receive $1,200 checks in the near future, pending appeal.

U.S. District Court Judge Phyllis Hamilton. (Photo: Wikipedia)

Earlier this year, the Coronavirus Aid, Relief, and Economic Security Act (Cares Act) was passed by Congress, giving $1,200 to individuals, $2,400 for joint returns, as well as $500 for each child under 17.

While there were restrictions on who could receive stimulus checks in the Cares Act, such as individuals making six-figure incomes and above, the Act did not initially halt payments to those in prison. By June, 85,000 prisoners in the U.S. had received stimulus checks, amounting to close to $100 million in total.

However, the IRS soon stopped payments due to complaints. They asked prisons to stop checks from going to prisoners and sent letters to those in jail and their families to return the money that had been given.

This action caused many prisoners and many families of prisoners to go to lawyers. A class-action suit represented by several San Francisco firms soon formed and was bolstered by more prisoners throughout the summer.

“There’s a lot of people who think just because he’s in jail that we don’t deserve the money,” Angelique Morris, whose husband is currently in jail as part of a ten year sentence, told the California Globe. “But taxes were paid. And we have kids and high phone bills from calling him in prison and lots of other expenses since I’m the only one really working. Stimulus money could have really helped out, but instead we don’t have it coming. I think the prison stopped his check.”

“The money would be going right back out there. But they still said no. And when another wife whose husband is in prison told me about this class action lawsuit, it felt like a godsend.”

IRS, Treasury Department to appeal ruling

U.S. Department of Treasury Secretary Steven Mnuchin. (Photo: Wikipedia)

Only weeks before, a preliminary injunction by a lower state court clarified that those in prison can’t receive the check. However, Judge Hamilton’s Monday decision changed that as well, ruling against the Treasury Department and the IRS. The IRS now has until the end of October to decide to pay or not. If they don’t, the court will likely order them to because of the ruling.

The government, led by IRS Commissioner Charles Rettig and Treasury Secretary Steven Mnuchin, have said that they will be appealing the ruling.

“There is no basis in law or fact for the IRS to disallow these payments,” explained executive director of the Center for Taxpayer Rights Nina Olson on Monday.

However, supporters of not paying prisoners were adamant about holding by their decision.

“They went to prison for breaking the law, and you give up many rights when you’re sent to prison,” George Santos, a Los Angeles-based longer prison sentence advocate, explained to the Globe. “They can’t vote and they can’t do many normal things, like holding a full-time job or work outside of anything the prison. So it makes sense they lose things related to that, including stimulus checks.”

“It’s what prisons are for, but as the ruling shows, some in California believe in more leniency.”

The appeal by the government against the California District court ruling is expected to be filed by the end of October.

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