Taxpayers who lost or threw away a pre-paid debit card containing their federal coronavirus relief payment won’t have to pay a replacement fee, U.S. Rep. Cindy Axne’s office said Friday.

The IRS announced it would waive the $7.50 fee for the first replacement card and also increase the limit on the amount a taxpayer can transfer to a bank account.  The previous limit was $1,000 per calendar month, which would have forced some taxpayers to transfer balances over a period of months.  The new limit is $2,500.

The IRS did not say whether it would waive a separate fee for expedited delivery of a replacement card.

Axne’s office received the notice from its IRS district representative, according to Axne spokesman Ian Mariani.  U.S. Rep. Abby Finkenauer had sent a letter to U.S. Treasury Secretary Steven Mnuchin this week asking for the card replacement fees to be waived.

Axne is moving ahead with a letter from 10 members of the House Financial Services Committee asking the Treasury Department to waive other fees associated with the card. One of those fees is a $2 charge after the first transaction at any ATM that is not part of a preferred network.  In Iowa, the in-network ATMs are all in the Des Moines metro area.

“While we understand that sending prepaid debit cards is a part of attempting to get payments out faster, we would urge additional consideration of how to ensure the cards are providing the benefits they are intended to,” the members wrote. “The possibility of debit cards was not widely known, so we worry that sending these cards may have slowed use of EIP funds for many.”

As Iowa Capital Dispatch has reported, hundreds of Iowans have called the Iowa Attorney General’s office and congressional offices raising questions about the cards. Many feared it was a scam and some said they threw away the cards without realizing it was their way to access their stimulus payments.

The letter notes that many Americans are not regular users of pre-paid debit cards and less than 10% of Americans had used one in the last 12 months, according to FDIC. “The lack of communication surrounding these cards left many of my constituents with no idea they might receive their EIP via debit card or unsure of how much they’d received,” the letter states.

The letter also asks Treasury to simplify the cardholder agreement and rules and remove an arbitration clause in the agreement.

In addition to Axne, the letter was signed by these House Financial Services Committee members: Joyce Beatty (OH-03), Sean Casten (IL-06), Bill Foster (IL-11), Vicente Gonzalez (TX-15), Josh Gottheimer (NJ-05), Denny Heck (WA-10), Stephen Lynch (MA-09), Ed Perlmutter (CO-07), and Brad Sherman (CA-27).