Lawyers for a couple of inmates brought a class-action lawsuit against U.S. Treasury Secretary Steven Mnuchin and IRS Commissioner Charles Rettig arguing that denying these individuals relief checks based on their incarcerated status is unlawful.
U.S. District Judge Phyllis Hamilton ruled the decision to exclude them was arbitrary and capricious.
Hamilton says that nothing in the Coronavirus Aid, Relief, and Economic Security (Cares) Act prohibited those in jails and prisons from receiving the relief funds.
The IRS updated stimulus check guidance following a preliminary injunction issued in California to clarify that incarcerated individuals cannot currently be denied a $1,200 check as the federal government appeals the ruling.
Lisa Holder, one of the attorney who sued on behalf of two inmates tells the L.A.Times “it’s very clear that the IRS is in the wrong and they have to make these payments to incarcerated folks. They don’t have any viable legal argument.” A report by the Treasury Inspector General for Tax Administration said more than 84,600 checks totaling about $100 million were sent to people in prison.