Key takeaways from our COVID-19 Tax Webinar!
🎓 How coronavirus affected nonresident tax compliance
Overview of common issues for international offices, payroll, visa sponsors, and nonresidents, plus clear answers to frequent questions.
💳 The CARES Act – Economic Impact Payment (EIP)
1️⃣ What is the EIP?
One-time stimulus payment:
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$1,200 for single filers earning < $75,000
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$2,400 for married filing jointly earning < $150,000
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$500 per qualifying child
(Phase-out applies.)
2️⃣ Who is eligible?
You may qualify if you:
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Are a U.S. resident for tax purposes
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Filed Form 1040 (resident return) for 2018 or 2019
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Will be a qualifying resident alien for 2020
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Have AGI within thresholds (phase-out to $99,000 single / $198,000 MFJ)
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Have a valid SSN
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Are not claimed as a dependent
3️⃣ Are nonresident aliens eligible?
No. Nonresident aliens are not entitled to the payment.
🧭 Resident vs. nonresident for tax purposes
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Tax residency is independent of visa status.
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F-1/J-1 students are typically nonresidents for their first 5 calendar years in the U.S.
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Other J categories are generally nonresident for 2 of the last 6 calendar years.
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After those periods, the Substantial Presence Test (SPT) determines residency.
💸 Received the stimulus in error? What to do
5️⃣ If an international student, scholar, or J visa holder will not be a resident alien for 2020, they are not eligible and must return the payment to the IRS.
Steps to double-check prior filings (2018/2019):
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Confirm whether you filed Form 1040 (resident) or Form 1040-NR (nonresident).
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Complete the Substantial Presence Test for that year.
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If you filed as resident but should have filed as nonresident, prepare and send an amended federal return (Form 1040X).
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Return the stimulus payment to the IRS with a brief cover note explaining why you’re returning it.
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Keep copies of everything you send.
If you correctly filed as resident and will also be resident for 2020, you may keep the payment.
6️⃣ Resident in 2018/2019 but left the U.S. before 2020?
If you are not a resident alien for 2020, return the payment.
7️⃣ Will the IRS seek repayment of erroneous $1,200 checks?
Yes. The IRS has issued guidance for payments received in error.
8️⃣ Is the stimulus taxable income?
Generally not taxable. (Final IRS confirmation pending at the time referenced.)
9️⃣ If I amend my federal return, do I amend my state return too?
Possibly, yes—depends on personal circumstances.
🧾 Tax filing FAQs
1️⃣1️⃣ Who must file Form 8843?
All nonresidents (students, scholars, J visa holders) must file Form 8843, even with no income.
1️⃣2️⃣ Housing or housing allowances for nonresidents
Generally taxable and reportable. If > $0 in taxable U.S. income, file a federal return (and possibly a state return).
1️⃣3️⃣ Filing from overseas / e-filing
E-filing is limited for nonresidents abroad. Most must mail returns to the IRS. Expect delivery delays due to COVID-19; file as early as possible and use registered/trackable mail.