All U.S. expats need to know about the COVID-19 stimulus package
In this article we will discuss all measures taken under the CARES Act and how they work out for U.S. expats.
Tax filing deadlines
The regular April 15 tax filing deadline is extended until July 15 – this gives expats an additional month to file their tax returns (as expats have an automatic extension to June 15).
Interest and penalties
If returns are filed by the July 15th deadline, expats won’t have to pay any interest or penalties on any tax owed. This is only relevant is you expect to pay U.S. taxes as an expat.
COVID-19 economic impact payment
The government is sending every taxpayer (yes, even expats) a stimulus check of $1,200 per adult, and $500 per under-17 child, limited by your income.
How much can you receive?
- The full amount phases out based on your income.
- If your adjusted gross income (look at line 7 of your 2018 tax return, or if you filed already look a line 8b of your 2019 tax return) is below certain thresholds, you will receive a stimulus check.
- Taxpayers below the lower threshold will receive the full amount. Being above the upper threshold means you will not receive a stimulus check.
|$75,000 - $99,000
|Married filing jointly
|$150,000 - $198,000
|Head of household
|$112,500 - $146,500
How to receive the stimulus check?
- You must have filed a 2018 or 2019 tax return.
- You must have a social security number.
- You don’t need to do anything, the IRS will either (i) direct deposit the amount based on the bank details provided in your 2018 or 2019 tax return or (ii) send a check to the address on your 2018 or 2019 tax return.
When will you receive the stimulus check?
Likely in April
How is the stimulus check taxed?
It’s not! It will be treated as an advance non-refundable credit available to you for 2020.
Any other relief for expats?
Yes, if you were affected by COVID-19 and had to move your family out of your primary residence, keep track of all your travel and temporary housing expenses. Expatfile will be able to automatically calculate and increase your foreign housing exclusion / deduction when you file your 2020 tax return. This could save you additional money!
Want to know more about the stimulus check and how to claim it, please check out our article on how you can claim your stimulus payment through a refund on your 2020 expat tax return.