What situation requires a Treasury-disbursed Federal payment to be returned?

A Treasury-disbursed Federal payment requires a return primarily when the recipient's account is closed. In this scenario, the banking institution cannot process the payment because there is no active account to receive the funds. Returning the payment ensures that the funds do not remain in limbo and can be reallocated or returned to the Treasury.

For situations involving incorrect payments or payment amounts exceeding limits, these may also require a return, but the mechanics would depend on specific circumstances, such as whether the payment can be corrected or adjusted.

If a recipient has moved to a new address, the assessment of whether a payment should be returned depends on the ability of the payment processing system to update the records correctly. The payment may still be processed correctly at the original account, even with the address change, so this does not automatically necessitate a return.