Questions about whether children who turned 18 in 2020, or who won't be born until August, would be considered "dependents" for the purposes of receiving a U.S. government CARES Act rebate check were among the highlights of a recent, hour-long webinar sponsored by the Association of Americans Resident Overseas.
The webinar, which is still available to AARO members via the organization's website, took place earlier this month, and featured Monte Silver, an Israel-based American expat lawyer who recently joined the AARO's board, and named chair of its tax committee; and Katelynn Minott, pictured left, a managing Certified Public Accountant and partner of Bright!Tax, an online American expat tax specialist firm that has clients in some 190 countries, according to its website.
The first in a series of such webinars by the AARO, it was set up in the wake of the signing into law at the end of March by President Trump of a US$2.2trn, bipartisan emergency coronavirus relief package, known as the CARES Act. The relief package was designed to put a significant amount of money back into the U.S. economy, in order to mitigate the damage done to it by the COVID-19 pandemic.
The first half of the webinar features Minott, with some input from Silver, discussing how Americans resident abroad might go about obtaining their one-off "Economic Impact Payments – as the IRS refers to what for most individual taxpayers would be a single US$1,200 payment.
At about the halfway point of the webinar, Minott begins to address questions from her listeners. For those who have already read general articles on the Economic Impact Payments recently, these questions stand out, as the answers for the most part have not been published elsewhere, and many had to do with specific situations that, while not usual, tend not to be addressed in articles of a general nature about the CARES Act payments.
With respect to the question about when a child might cease to be claimed as a dependent for the purposes of the US$500 check being given to parents of children under 17, as a result of their having their 18th birthday, for example, Minott noted that this was one of a number of details that had yet to be clarified by the IRS, but added: "I would expect that 12/31/2019 would be the relevant date, as that is the most recent tax return.
"We won’t know the final answer until the IRS begins to send out final payments, however."
She then said, in answer to another listener's question, that she thought the IRS would be unlikely to consider a baby due in August to count towards a dependent child's payment, "because this child wasn’t a dependent “as of 12/31/2019”.
Another expat listener asked whether someone whose only source of income was Social Security would be eligible (yes, and they "would not need to file a return to be eligible for this rebate"), while a Green Card holder who said they were "a permanent resident of the U.S. and working in the U.S." wondered if they would be eligible for the payment ("yes, [because] you are considered to be a U.S. person, and that therefore makes you eligible").
The AARO was founded in 1973 and is headquartered in Paris. An international, non-partisan association, it has members in 46 countries, and according to its website, carries out research into issues that significantly affect the lives of overseas Americans and endeavors to keep them informed on those issues, while at the same time working to educate Congress, the media and the public on such expat-relevant topics as taxation, absentee voting, citizenship, representation, Social Security and Medicare.
The AARO webinar described above is one of a new series of webinars that the AARO is holding as part of its efforts to help expatriates around the world to get to grips with the coronavirus-related issues, and the relief options that are currently being made available to them, including the U.S. government's CARES Act stimulus payments. Information on other AARO webinars in this series may be found here.
For more information about the AARO, including how to become a member, click here.
The views expressed above are for general information purposes only, and should not be construed as recommendations or advice for any individual, nor should any action be taken on account of the information presented. Nothing discussed in the webinar may be construed as legal, tax or accounting advice, and the AARO is not responsible for its content.
Further information on the topics discussed during the webinar may be obtained by contacting Bright!Tax at https://brighttax.com/.
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