Coronavirus stimulus checks were primarily sent to financially support people struggling due to the pandemic and, in turn, to stimulate the economy. However, the IRS also issued billions of dollars in stimulus aid to Americans living abroad. Even though sending coronavirus stimulus checks to Americans abroad doesn’t exactly stimulate the U.S. economy, several lawmakers believe there is a valid reason for sending payments to Americans living abroad.
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The IRS has issued about $5.5 billion (more than 3.7 million payments) in stimulus payments to people living outside of the 50 U.S. states and Washington, D.C, according to government data. This data includes the three stimulus checks sent since the start of the pandemic last year.
Moreover, the data includes U.S. citizens abroad, military personnel stationed abroad, and residents of many major U.S. regions, such as Puerto Rico.
According to government data, about 9 million U.S. citizens live overseas, and many of them would have qualified for the stimulus checks because of the eligibility requirements set by Congress. Still, it is estimated that the scope of the payments is relatively small, at less than 1% of the total payments issued by the IRS.
Those against sending coronavirus stimulus checks to Americans abroad argue that it is not in line with the government’s objective because the aim is to stimulate the economy by increasing demand for goods and services in the country.
Thus, sending coronavirus stimulus checks to Americans abroad doesn’t contribute to this objective. However, several lawmakers believe the primary objective of the stimulus checks was to support American households amid mass unemployment and financial hardship.
Thus, if the objective of the stimulus checks is to help struggling American families, then it makes no difference if they live in the country or abroad. U.S. citizens living abroad have to file a U.S. tax return on their total income. Thus, by filing a tax return, Americans living abroad may qualify for the Economic Impact Payment (stimulus checks).
Americans Abroad Got Child Tax Credit
The Economic Impact Payments had a broader scope than most other federal stimulus payments. For instance, Americans living abroad didn’t qualify for the enhanced unemployment benefits even if they were working remotely for a U.S. company.
Americans living abroad only qualified for the enhanced child tax credit if they (or their spouse) had their main home in the U.S. for over half the year. As a result, parents who don’t meet this criterion may have to refund the amount of the credit they received.
According to the U.S. Department of the Treasury, about $94 million of the total $61 billion sent through the monthly child tax credit installments from July to October went overseas.
