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ACA writes to IRS and Treasury highlighting problems with “Get My Payment” and urges them to find a solution

April 24, 2020

VIA EMAIL

The Honorable Steven T. Mnuchin     
Secretary of the Treasury
U.S. Department of the Treasury
1500 Pennsylvania Avenue, NW
Washington, DC 20220

 

The Honorable Charles P. Rettig
Commissioner
Internal Revenue Service
1111 Constitution Avenue, NW
Washington, DC 20224

 

RE:  Feedback from Americans Overseas on “Get My Payment” Online Tool

Dear Mr. Secretary and Commissioner Rettig,

We are writing on behalf of Americans Citizens Abroad, Inc. (ACA), a qualified section 501(c)(4) non-profit membership organization, and its sister-organization, American Citizens Abroad Global Foundation (ACAGF), a qualified section 501(c)(3) charity. ACA is a volunteer organization representing the estimated 8 to 9 million Americans living abroad. Both organizations are headquartered in Washington, D.C. ACA has members in 70 countries and chapters in Geneva and London.[1]

ACA has sent the IRS and the Treasury Department two communications on the subject of Americans overseas and the CARES Act:  Our letter dated March 23, 2020 stressed that Americans overseas be considered in the provisions of the CARES Act, and our memorandum dated March 27, 2020 was intended to assist the Treasury Department and the IRS as they develop the detailed workings of the new provisions, especially the Title II, Subtitle B Rebates and Other Individual Provisions.

The IRS is working to process the CARES Act recovery rebates for all Americans in the most expedient manner possible, that being by direct deposit into a US bank account.  Many Americans overseas who have not provided the IRS with bank account information on prior tax returns, now need quickly to deliver this information to the IRS. The “Get My Payment” online tool launched by the IRS on April 15th is designed to allow these individuals to provide their U.S. bank account information.

Messages from ACA members and others in the community of Americans overseas have highlighted certain problems or “glitches” with the “Get My Payment” tool. One issue is the ability to input a foreign address. The online form indicates that a foreign address can be entered as indicated on the zip code line it states, “[zip code] Required except for countries without a ZIP or postal code.”  However, users report that once they input their foreign address, name and Social Security Number (SSN) they receive an immediate “payment status unavailable” or “unable to verify your eligibility” error message.

Because most users have been unable to advance beyond the name, SSN and address input screen, it is unclear how the identity verification process functions.  One of the FAQs listed on “Get My Payment” states that, “You will be given the opportunity to provide your bank information once you have properly verified your identity.”  For some IRS online registration tools (for example, “View My Account”) identity verification is made through the use of questions linked to US indicia and often there is second level verification by the texting of a code to a U.S. phone number.  For obvious reasons, many Americans overseas may have limited or no U.S. indicia and only a foreign phone number.

Once users have been verified, they will find that they must provide the IRS with a U.S.-based bank account. This can be a problem for Americans overseas who generally bank locally in the countries where they live and only have a foreign bank account. ACA understands that for reasons of safety and fraud prevention, the IRS is requiring that the recipient have a U.S.-based bank or other financial institution, including a credit union, for direct deposit of the recovery rebates. An exception is made in the case of an individual receiving U.S. Social Security benefits, in which case the individual will have created an account with the Social Security Administration and provided the information allowing direct deposit into his or her foreign account. Direct deposits to a financial institution in a country that has an international direct deposit agreement with the US is possible and indeed quite common. https://www.ssa.gov/pubs/EN-05-10137.pdf. The IRS has said that it will use the banking information on record for making direct deposits of Social Security benefits for purposes of making recovery rebates.

In the current system for handling recovery rebates, there is nothing similar to the creation of a Social Security Administration account in the name of the recipient. Perhaps Treasury and the IRS have in mind creating something like this, but this piece of the machinery is not currently in place. Creating such a mechanism might require still more mechanisms and additional support personnel to oversee their workings.

ACA would like to offer its thoughts on the subject. First, Treasury and IRS should immediately launch a public awareness campaign publicizing the fact that for Americans overseas who may not have filed a tax return for 2019 or 2018, they can file a simplified federal income tax return for 2019 inserting in that return their direct deposit information. At present, in the ex-pat community, this is sometimes referred to as a “simplified return” or an “all-zeros return”. If the individual has a U.S. financial account, this gets the basic information to the IRS. It does not solve the problem of not having a U.S. financial account.

Secondly, as a means of addressing the lack of a U.S. financial account, ACA, together with a growing number of return preparers and other advisors, can offer this. For its members, ACA will help any individual who is a U.S. citizen, whether residing abroad or in the U.S., to open a State Department Federal Credit Union (SDFCU) account. This is a U.S. account. The account-opening procedure can be accomplished entirely online and generally can be done in one session. There are no account-opening fees or minimum deposit requirements for the SDFCU account.[2]  Acceptance of this approach has been quite strong since first introduced in 2015, attracting users from 91 countries; and since consideration and then enactment of the CARES Act, from 34 countries. 

ACA believes that a means for delivering recovery rebates/payments to Americans overseas, including those who in the past did not need to file a return as well as those who do not have a US financial account, must be developed and made available as soon as possible.[3]  Everyone recognizes that relying upon paper checks that are mailed to locations outside the United States must be avoided if humanly possible.

Additionally, ACA would like to offer its help in disseminating information to American taxpayers abroad and their advisors, including accountants, return preparers, legal advisors, and investment advisors.[4] We have been in discussions with IRS personnel even before the appearance of the coronavirus pandemic about improving services for Americans outside the US, and we have increased this activity in recent weeks.

ACA is aware that the IRS and Treasury Department are working under highly unusual circumstances. We greatly appreciate all the attention given to the subject, and we look forward to hearing back from you with guidance on how Americans abroad should proceed to obtain their recovery rebates.

Kind regards.

Marylouise Serrato, Executive Director, American Citizens Abroad, Inc.

Jonathan Lachowitz, Chairman, American Citizens Abroad, Inc.

Charles Bruce, Chairman, American Citizens Abroad Global Foundation

 

CC:     

Erin M. Collins, National Taxpayer Advocate 

Representative George Holding, Member, House Committee on Ways and Means

Representative Carolyn Maloney, Co-Chair of the Americans Abroad Caucus

Representative Dina Titus, Member, Americans Abroad Caucus

Representative Donald S. Beyer, Jr., Member, Americans Abroad Caucus      

 

[1] ACA (ACA and ACAGF are jointly referred to as ACA) is nonpartisan. It is not related to any political party or other political organization.  Over 40 years, it has grown to be a premier advocate for Americans abroad, providing practical solutions and making sensible proposals.  We advocate on a wide range of subjects that benefit our members, including proposals relating to nationality, voting, taxation, and social services.  ACA seeks to educate and inform Congress and the Executive Branch on these issues and, more generally, developments affecting Americans abroad. Also, it disseminates a large amount of information to Americans living outside the U.S.

[2] Details and additional information are available at https://www.americansabroad.org/sdfcu-account/.

[3] A good deal of know-how was developed in connection with the Economic Stimulus Act 2008. See, for example, Notice 2008-28, 2008-1CB 546, dealing with rebates for individuals not required to file. This Notice describes in considerable detail what might be put into a “simplified return”/“all-zeros return".

[4] since 2014, ACA has published online directory of return preparers and others servicing the ex-pat community. This directory was recently revised and expanded. https://acareturnpreparerdirectory.com/