Coronavirus pandemic and CARES Act legislation
On March 27th the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law. There are still many provisions of the law that are being worked on and new information from the Internal Revenue Service (IRS), the Treasury Departmentand other offices, is being updated daily. The CARES Act infuses 2 trillion dollars in relief into the American economy to assist individuals and businesses affected by the pandemic.
ACA’s efforts on behalf of the overseas American community.
- April 24, 2020 - ACA writes to the IRS and the Treasury Department highlighting problems with the “Get My Payment” online tool and urging them to find a solution for Americans Overseas to quickly and easily apply for recovery rebates.
- March 31, 2020 - ACA announced its monthly ACA Tax Cast podcast series. In the premier episode talks about the COVID-19 stimulus package. Given the rapidly changing environment due to the Coronavirus and the CARES Act, ACA Tax Cast will be adapting its podcast schedule and adding more shows throughout the month instead of just monthly. Transcripts for the podcast will be provided, please check back.
- March 30, 2020 - ACA is raising issues such as, the mechanics of electronic transfers (direct deposits), the ability of overseas Americans to provide banking information to the IRS, to the highest levels of the IRS and Treasury with our already established contacts in these offices. ACA recently discussed the development of the IRS’s web-based portal for individuals to register and provide their banking information. In our communications, ACA has highlighted to the IRS issues Americans overseas may have with online registration. Many online registration tools aren’t set up to accommodate Americans overseas; things like verification of identity through the use of US-based indicia. If you have lived overseas a long time or never lived in the US, you may not have any. Additionally, the use of second-level verification through the texting of codes must accommodate for foreign phone numbers, something many online formats are unable to accommodate. Some of these online tools will not recognize an IP address coming from outside of the United States.
- March 27, 2020 - With the passage of the CARES Act legislation on March 27th, ACA immediately prepared a memorandum discussing the tax provisions of the Coronavirus Aid Relief, and Economic Stimulus Act. The memorandum is intended to inform Americans residing abroad and professional advisors, such as tax return preparers who help them and to assist the Treasury Department, IRS and Congress as they dig into the detailed working of the provisions of the law as they turn their efforts to implementation.
- March 26, 2020 - ACA recognized that for the IRS to make direct deposit of recovery rebate payments, individuals will need a US-based bank account. In 2016 ACA, in conjunction with the State Department Federal Credit Union (SDFCU), developed the ACA-member/SDFCU account. Recommended as a must for all Americans overseas, the current pandemic is a perfect example of its usefulness. This is a US-based bank account that can be opened online easily and quickly with no need to provide a US residential address. ACA received SDFCU’s continued commitment to help Americans Overseas receive rebate recovery payments and announced this on March 26th.
- March 23, 2020 - ACA was the first organization representing overseas Americans to advocate to the Congress, the IRS and Treasury stressing that Americans overseas needed be included in the legislation. In our letter dated March 23rd, ACA notes that special consideration is needed for issues such as, filing deadlines, mechanics of advance refunds and credits, need for a US bank account for rebates, loans to small businesses, limitations based on adjusted gross income among others, as these apply to the community of Americans living and working overseas. As a result, Americans overseas are eligible for the recovery rebate payments. ACA continues to investigate how other elements of the CARES Act (relief for small businesses) will affect Americans overseas and will provide updates to the community.
When dealing with coronavirus recovery rebates, which is inherently a tax subject and may entail issues of tax compliance, readers should carefully consider their obligation to be tax compliant. There may be situations where they should consult a tax professional. The ACA Expat Tax Services Directory is an important resource for information.
Some additional useful information can be found at the following links. Check back as ACA will be updating this page as new information is made available.
- Non-Filers: Enter Payment Info: IRS link to provide additional information to receive the Economic Impact Payment
- IRS Notice 2020-23 (April 6, 2020): IRS extends additional key tax deadlines for individuals and businesses
- IRS memo IS 2020-61 (March 31, 2020): Economic impact payments what you need to know
- Congressional Research Service COVID-19 and Direct Payments to Individuals (March 22, 2020): Summary of the 2020 Recovery Rebates in CARES Act
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