International students IRS COVID-19 stimulus checks/direct deposits

What is below is our best understanding of current guidance from the IRS. Please be aware that the COVID-19 situation has greatly impacted their response time and ability to answer questions, even as things are constantly being clarified and updated. As always, they are the final source for any tax related concerns.

If you need more information than what is below:


Who is ELIGIBLE to claim the stimulus funds:

  • You correctly filed as a resident for tax purposes (that is, you met the substantial presence test) and did not have an adjusted gross income greater than:
    • $99,000 if your filing status was single or married filing jointly
    • $136,500 for head of household
    • $198,000 if your filing status was married filing jointly
  • You are a permanent resident
  • You are a US citizen
  • It is unlikely at this time that there will be a risk of Public Charge for any eligible person who claims the stimulus funds. You should be safe to spend your funds, unless the IRS issues further guidance.

Who IS NOT eligible to claim the stimulus funds:

  • You can be claimed as a dependent on some else’s tax return (such as a parent)
  • You do not have a valid Social Security number
  • You filed using the 1040NR or 1040NR-EZ, or 1040-PR or 1040-SS in 2019
  • You are a non-resident for tax purposes (that is, you did not meet the substantial presence test and filed your taxes as an international student)

FAQs

1. I am not sure if I filed correctly? Do I meet the Substantial Presence Test?

  • If you are not sure whether you filed correctly:

2. How do I return a stimulus check/direct deposit?

  • Instructions from the IRS
  • Direct deposit: your bank should be able to handle the return for you. Contact them.
  • Mailing back a check:
    • We suggest you include a cover letter explaining why you are returning the funds
    • Make sure any payments you return are mailed separately to filing any amended return
  • ALWAYS KEEP COPIES!
    • Be sure to keep copies of any documents you send to the IRS, both physical and electronic. You may need this information again.

3. I was an non-resident for tax purposes who filed as a resident for tax purposes by mistake in either (or both) 2018 and 2019.

  • You should NOT keep the money.
  • You will need also need to refund any additional money you may have received in 2018 or 2019 that occurred because you filed incorrectly. You do this by filing form 1040X and a new 1040NR for each incorrect year.
    • DO NOT PANIC: The IRS receives thousands of amended returns every year. Mistakes happen, but you must correct them.
    • Note: you may need to amend your STATE tax return also.

4. I filed correctly as a resident for tax purposes in 2018 or 2019 but have since left the country, yet I still received a stimulus check. What do I do?

  • While you may be entitled to keep the money, based on the eligibility above we do not believe that it meets the intention of the stimulus funds.
  • The safest option may be to return the money.

5. Will the IRS send out notices to collect the $1200 payments that were made in error? (Will they catch me if I cash it?)

  • We do not know if they will make efforts to collect payments that were made in error. It may take them a couple of years to request that funds are returned. You would need to pay interest on any money owed at that time.
  • You should assume that, yes, they will catch you. If not now, then potentially at some time in the future.

6. Is the stimulus check considered taxable income?

  • Generally, no, this is not considered taxable income, although final guidance on this has not been issued.

SPRINTAX WEBINAR, on April 29

Sprintax Tax Webinar 1 is on Wednesday, April 29 at 2 - 3:00 p.m. (EST)

You can join the meeting from your computer, tablet or smartphone.

You can also call in using your phone.