Government says it can't handle large checks with current equipment.
Starting in 2016, the Internal Revenue Service says it can no longer accept checks for $100,000,000 or more to pay taxes. According to CNN.com, the agency says taxpayers or businesses that owe more than that amount will have to submit two or more separate checks to cover the bill.
Another option would be to send the money electronically via Fed Wire. Any checks over the $100 million amount will be returned for re-processing.
The reason is the government does not have modern equipment sophisticated enough to handle a check written for over $1 million dollars, so the agency must handle all those checks manually. That increases the chance for errors, fraud and uncollectable funds greatly, so the Treasury has decided to limit the amount of the checks to eight digits or less.
David Melter, director Over the Counter Division at the Department of Treasury said in a letter, “In addition, the large check items may become lost or mis-shipped, stolen, and require special handling procedures by the TGA [Treasury General Account] banks.”
Most filers won’t be inconvenienced by the new rules. Typically, American taxpayers file electronically, and the majority don’t owe such large amounts in the first place.
But you might be surprised to know that the IRS deposited 14 checks last year that were written for more than $100 million, and the agency has noted an increase in the number of such checks recently.