Updated: April 30, 2020
US Congress has passed the Coronavirus Aid Relief and Economic Security (CARES) Act.
The president has signed it into law.
Discover how Americans abroad can access aid.
I want to thank Democrats Abroad and the Democrats Abroad Taxation Task Force for providing the information in this post and for all their efforts on behalf of all Americans abroad.
Below is a summary of key aid provisions that are or may be relevant to Americans abroad
- Americans abroad who meet the income eligibility criteria (see below) are entitled to the Recovery Rebate (up to $1,200 payment per adult plus $500 per child)
- Taxpayers who have provided bank account details with their tax filing will likely be receiving payments by direct deposit in the next 3 weeks or so, with others likely receiving checks or debit cards through the post. (See below for a US bank that does not require a US address)
- Treasury has been provided with flexibility in the language of the bill for providing the cash aid to citizens who have not filed tax returns in 2018 or 2019. We will follow this closely.
- Individuals with federal student loans automatically have their interest rate set to 0% for 60 days and can request forbearance (a suspension of payments) for 60 days.
- Small businesses have been provided with a range of supports to enable them to retain their employees and keep paying their salaries and benefits, via an existing SBA loan product whose eligibility criteria have been greatly relaxed. This MAY enable Americans abroad with small businesses to qualify for support.
A great many questions remain about how these and the myriad other relief mechanisms in the historic $2 trillion dollar package are to be implemented. Treasury and the IRS have a lot of work ahead of them.
More Details About Recovery Rebate Payments
Here is some additional information for those of you who may qualify for a direct cash payment. The IRS has a FAQ page regarding the payments, here.
One thing you can be certain about, as an immediate relief package it fails. This is especially true if you don’t have a direct deposit arrangement with the IRS or with SSA, or you did not file a 2018 or 2019 tax return. In those cases, as of March 28th, you can expect to receive your one-time payment in 2 to 6 months or longer.
Encouragingly, as of today’s update (April 16th), some people have already received their checks. That is, the people who already had a direct deposit arrangement with the IRS or SSA have started receiving this one-time payment. If you want to inquire about the status of your check, use this IRS page.
Below are the payment eligibility requirements:
- Eligible incomes: Single people up to $75,000, head of household filers up to $112,500, and married couples filing jointly up to $150,000.
- Eligible single people will receive $1,200. Married couples will receive $2,400, and parents will receive $500 for each child under age 17. To determine a person’s income, the IRS will use the most recent tax return filed (2018 or 2019 returns only).
- Single people who earned from $75,000 to $99,000, will receive some portion of those $1200 payments. And likewise head of householder’s from 112,500 to $136,500 , and married filing jointly from $150,000 to $198,000 will receive some portion of their payments. The payments will phase out completely for people making more than those relevant income brackets.
- Expect a direct deposit payment in 2 weeks to 2 months, as of March 28th.
- If you don’t have direct deposit payments set up with the IRS, it will take at least 3 – 4 months to receive a physical check, likely longer.
- Do you already have your Social Security checks direct deposited? The IRS will use that information to direct deposit your relief check if you qualify.
- Didn’t file your 2018 taxes, perhaps because you had no tax obligation? To get a payment, you must file a 2019 tax return ASAP. And don’t forget to set up direct deposit payments with the IRS while you are at it.
- Did you receive a 2018 tax refund in the mail, but have since moved? Perhaps you moved to Panama? Then if you want your check, you should file your 2019 return ASAP, otherwise the IRS will have no idea where to send your check.
- Made more than $75k or $99K in 2018 or 2019, but not in 2020? The IRS will allow tax filers to qualify for the relief aid next year when filing 2020 taxes. Not very helpful in the moment, but nice to know about.
CARES Act Federal Government Outreach
Democrats Abroad has written to Treasury and the IRS on behalf of Americans abroad and put a range of implementation issues and recommendations to them. This letter was sent just after the Act was signed into law on the afternoon of Friday, March 27th. We intend to work through our friends on Capitol Hill and in collaboration with our colleague organizations representing Americans abroad.
Friends on Capitol Hill
We thank in advance Rep. Maloney (D-NY) and Rep. Meadows (R-NC), co-chairs of the Americans Abroad Caucus, Rep. Jamie Raskin (D-MD) formerly of DA France, Rep. Don Beyer (D-VA) former Ambassador to Switzerland and Rep. Dina Titus (D-NV) a long time friend and support of Democrats Abroad for their support for the Americans Abroad community. We know we can rely upon them to ensure Americans abroad are not forgotten in the implementation of the CARES Act.
Americans Abroad Community coalition
We draw your attention to this letter published earlier this week by American Citizens Abroad (ACA) drawing attention to a number of issues in the CARES Act relevant for Americans abroad.
In addition to the ACA Directory of U.S. tax return preparers servicing Americans abroad which we recommend, Democrats Abroad also wishes to highlight the U.S. banking product arranged by ACA for Americans abroad through the State Department Federal Credit Union, which does not require a U.S. residential address.
Americans abroad are eligible for the CARES Act Recovery Rebate who do not have a U.S. bank account to facilitate the efficient delivery of the payment may be interested in the accounts available through this program.
Help Us Help You
The Democrats Abroad Taxation Task Force is interested in information and reporting about coronavirus aid programs enacted in other countries to support citizens through the Coronavirus lockdown. We have been reading about support packages proposed or put in place in Germany, France, the EU in addition to the UK, Australia, Canada and Singapore.
Knowing what is accessible to Americans living abroad will be essential to making a persuasive case for further access for Americans abroad to CARES Act aid and relief mechanisms and any future aid packages. Reports suggest there will be a 4th and 5th aid package coming.
We invite you to send to [email protected] reports about what coronavirus aid is available to citizens in the country where you live.
Please feel free to share this message and send comments and questions to [email protected]
Do stay in, stay well, and stay safe from the virus.
Looking for more funds? The CARES Act also allows you to draw on your retirement accounts (IRA, 401(k), etc) without penalty and doubles the amount you can borrow from your 401(k).
You can read about those CARES Act options in my new book about how to buy Panama real estate. Find out more here. For a limited time the kindle version is free on Amazon.