US Treasury ACH Transfer Rules in 2018

[Bill]

The US Treasury adopted a rule on September 15, 2017 to comply with NACHA’s 1-2 day rule for commercial ach transactions.

Basically, everything we know about prenotification and settlement dates is out the window. Hence the royal confusion compared to previous years.

The full rule is published in the national register here if you want to read it:
https://www.federalregister.gov/documents/2017/09/11/2017-19135/federal-government-participation-in-the-automated-clearing-house

if you want even more, you can search [ctrl+f] the Federal Reserve Operating Circular 4 for ‘appendix b’ — Paragraph 3 has the black and white of it:
https://www.frbservices.org/assets/resources/rules-regulations/operating-circular-4-091517.pdf

This is a direct link to FEDACH Daily Processing times referenced above:
https://www.frbservices.org/assets/financial-services/ach/091517-same-day-schedule.pdf

its hard to read, but the first column is earliest ACH batch trasmit – the second column is close time on ACH transmit – the third column is the latest time anything in those batches may be made available, this is only the TIME OF DAY transmit and receive happens on any given BUSINESS DAY.

In some of this info you”ll see two different terms: Business Day & Banking Day. To keep it short, a Business Day is Monday through Friday 8-5 except for the Federal Reserve Holidays that fall on weekdays. A Banking Day is defined as all the days in a year that aren’t the 10 federal holidays on which customers have access to the majority of the banks normal banking services.

For prepaid cards this means basically 355 days a year (more or less). For traditional banks and credit unions, this tends to match up with federal reserve hours.

Anecdotally, most of this years refunds seem to fall with the 2:15am future-dated batches. in this case, the final database batch operation runs and transmits between 2:15am and 6am and is ready for deposit at 8:30am Eastern Time either the same day or the next day.

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More information on the new ach rules can be found on frbservices.org:
https://www.frbservices.org/resources/resource-centers/same-day-ach/index.html

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A good simple overview of the ACH system and how transactions are processed is here: https://www.bank7.com/pdf/ACHQuickRefGuide2015.pdf

It’s an easy read, with good infographics. An A+ if you want to know more about how the Automated Clearinghouse system works :)

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If you want some info about how SBPTG does ACH check here:
https://pro.sbtpg.com/forms_show.aspx?formId=nfIwHZiIE9W1eHTktNgJiw==

This information is all current and in play as of Feb 20th 2018!

Hope this helps, i’ll update it with more tomorrow if anyone has questions!

[kev]

@Bill

I’m curious if yours have dropped?

Mine hasn’t. I had a ddd of 2/22 and still nothing. I called my bank this a.m. and they show nothing incoming. And the IRS WMR says it was sent yesterday.

I’m just looking for a little hope.

[Me2]

Thanks Bill, you’re very helpful

[Bill]

Well… after watching the different groups facebook it seems these are now dropping [mostly] by state (or maybe time zone) from east coast to west coast… so, like i said, YMMV…

To answer the question, Yes. Before 830am Eastern on Thursday 2/22 is the legally required settlement time for your funds if you have a DDD of 2/22.

Your individual bank may have policies that could prevent withdrawals like fraud policies or ID Verify, but if you’re a normal person you’re probably fine.

the IRS was legally bound to transmit their files to receiving banks at least 2 full business days before the ACH settlement date on each line-item in the batch – in this case your individual DDD. For us this means they transmitted on friday for some and tuesday for others.

All of the money for 2/22 had to be finished transmitting by 6:00 this morning though. It’s in there, just post-dated by your bank. Maybe that’s because overnight and next-day ACH is a brand new game when it comes to dealing with Government data, maybe because the government didn’t inform the card servicing ppl that they weren’t going to transmit pre-notes this year, maybe it’s the Fed treating the deposits like a pre-note so our Banks have time to fill their safes with the 45 Billion dollars in cash the US Treasury is sending all over gods creation. Who knows? Nobody can say for sure… Welcome to the machine…

Anyway, The friday batch jobs from the treasury to the fed to the middlemen all posted first. Friday’s was huge and apparently went to the ‘Tax Prep Fee Middleman’ Banks like SBTPG and such. Some middlemen seem to be quicker than others, but i still think that AMEX depositing on Friday was a screw-up. I believe that those batches are all finished depositing and now we’re seeing *some* of the no-fee-paid free efile refunds show up on *some* cards early but I can’t tell if there is any real pattern to tonight’s deposits yet…

It is plausible that the test group had some same-day and some next-day batches, but the irs said 2/22 for everyone ‘just in case’ and as always the banks are just doing it however it is that banks do it – but it’s not purposeful sadism like atm fees, 24.99% interest credit cards, and multi-transactional overdraft charges.

Honestly, I think we have a terribly understaffed government at the moment, and the atmosphere in DC/VA right now is pretty hostile depending on which side of the MAGA wall you support, so try not to be too salty on the phones – the government workforce may be faceless to you, but Its a terrible pay to cost of living ratio on the east coast so most of them desperately need the tax money too and they’re working their butts off to get the job done…

Tomorrow morning 2/22ers get to have a peaceful breakfast, but I wouldn’t write any checks for anything short of your DDD in future years .

Does anybody even notice the marketing and brainwashing that the prep companies pull on you. 2 days faster deposit of a tax refund means two days faster than a paper check. It is not a set in stone promise to pay out your deposit early.

If anybody is stealing your hard earned money its Jackson Hewwitt, H&R Block, TaxSlayer and their ilk. No child left behind made half the population afraid of basic math. Free file, go to a free filing clinic at the community college or aging people’s center, but for gods sake stop paying these companies 300-1200 dollars to do something that is literally the easiest math ever and anybody can do it themselves.

If you have a normal above-board business, most people pay an independent accountant to do the payroll & taxes.

As individuals, i urge you to stop feeding the pig of poor money skills, learn the process and let TurboTax and the BS bank of California-stan starve instead of giving their CEO a new leerjet with the cash the lackeys at wal-mart mugged you for and then gave you a subprime loan against…

BTW: The USPS is a federal system too and every post office in the US can hand you the forms you need. A paper check from the treasury is always in your home mailbox within 7 days of your DDD – usually it shows up within 1-3 days max – not 6-8 weeks later like the prep companies want you to think. The IRS says 45 days or 6-8 weeks as a matter of expectation management because some rare cases really do get lost in the process – 150+ Million Tax returns is a lot of data and all of the times that they give out presume that you filed on paper or had to be printed to hard copy for an IRS accountant to double check.

I know these are long, hope it was entertaining & informative =P

[Thewaiting]

@bill this is starting to make sense because my 2/22 and my 3party bank has not received my funds as of 8:11pm est and I don’t have any bad codes on my transcript…. so my question will we get our dd tomorrow?

[Bill]

After watching how and where things are dropping and then correlating that anecdotal data with the ACH Settlement schedule in the original post, I have come to some conclusions. Your milage may vary, this is just an old computer programmer’s best guess….

1. Deposits are clearing in LOCAL time not eastern. So FedWire seems to be following the rules that go into legal effect in march. see the federalregister link for more info on the specifics.

2. It doesn’t matter if you paid your fees up front or not. Other than last friday’s Amex/Serve/Bluebird thing [which i think was an error anyway] everyone has been on a ridiculously random drop schedule. This points toward the IRS/Treasury playing the CYA game while the banking system tries as hard as they can to not get boned by the regulatory agencies in the process.
the fees vs no fees, sbtpg, card type etc seems to not matter.

3. Bank type matters, but local rules regarding funds disbursement apply. Sometimes the individual bank or credit union will post before the ACH settlement date, but in the end – no bank is actually holding any funds until the FED settles the transactions, meaning that your bank/cu/card doesn’t think that the IRS might have a funding issue, it’s because your bank/cu/card can’t front the cash to everybody, so it won’t front it to anybody. Logical, no?

4. We are only working on 1 or 2 day holds at the most. The treasury is running *much* smaller daily batches in order to comply with this years new ACH rules. If you got money today, it was transmitted in big the 2.15am – 6am batch that went out in the very early hours of tuesday morning.

5. SBTPG / the IRS / the US Treasury / et cetera ad nauseum ARE NOT PROFITING AT ALL from holding anything. The ACH system is a massive beast, but there is no interest being earned on anything held in limbo. The IRS and Treasury cannot legally hold these in any sort of interest bearing account. So STAHPPIT AHLREADY! Nobody is screwing you, the process of legally transeferring 3k or more takes time, especially when the bank fraud departments have to check each deposit account – yes its a big computer, no it’s not instant, data processing takes time, especially when it’s being done in realtime…

6. I did my own taxes on paper, then free efiled Head-Of-Household with EIC through turbotax online. My DDD is 2/22. I have a greendot bank AccountNow card, and have no funds yet as of 5pm CST. My girlfriend has a RapidPay payroll card through metabank. Same process, EIC 2/22 filed single still no cash.

tldr:

It’s just a data processing system Don’t Panic. These systems are so huge and complex, they contain so much proprietary secret Federal Reserve banking data that even the best of researchers can’t nail anything down for certain.
Nobody’s stealing from you, computers are slow and as as i can figure, the transmit batches are small in order to prevent the massive overload on the system that the test batch created last year… some of us got resequenced last year because the ACH system balked at the size of the batches that the treasury was transmitting, so this is a good thing to make sure we all get to keep our deposit dates.

I’ll let y’all know when ours drop :)

[Cafeazucartx]

Thanks Bill. due diligence done well!

[Minneasnowta]

From what I gather from the information after reading 📖 information on the manuscripts you posted I can start checking my accounts after 8:30 am and could even be tomorrow it all depends on what type transaction you fall under.

[Minneasnowta]

FYI my state refund was received in the evening 5:30 pm I never gotten a dd in the evening

[Minneasnowta]

Thank you bill 👍 for you have done did your due diligence and I find this information helpful my 💰paydays are Wednesday but I receive on Tuesday night and before my paydays was on a Friday and I receive my money Wednesday or Thursday morning my ddd 2/22 for Federal and I don’t have it yet. State came one day early by 5:30 on 8th. Last year I received my refund late night on president day nothing yet this year

[Author]

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