Many members have reached out asking about the CARES Act impact for Americans living abroad. Fortunately the Democrats Abroad Taxation Task Force has prepared a report to share.
Congress has passed the Coronavirus Aid Relief and Economic Security (CARES) Act and the president has signed it into law. Americans abroad will be interested in understanding the law's aid provisions and how they can access them. This is a summary of key aid provisions that are or may be relevant to Americans abroad –
- Americans abroad who meet the income eligibility criteria (adjusted gross income under $99,000) are entitled to the Recovery Rebate (up to $1,200 payment plus $500 per child)
- Taxpayers who have provided bank account details with their tax filing will likely be receiving payments by direct deposit in the next 2-3 weeks, with others likely receiving checks or debit cards through the post
- Treasury has been provided with flexibility in the language of the bill for providing the cash aid to citizens who have not filed tax returns in 2018 or 2019. We will follow this closely.
- Individuals with federal student loans automatically have their interest rate set to 0% for 60 days and can request forbearance (a suspension of payments) for 60 days.
- Small businesses have been provided with range of supports to enable them to retain their employees and keep paying their salaries and benefits, via an existing SBA loan product whose eligibility criteria have been greatly relaxed. This MAY enable Americans abroad with small businesses to qualify for the support.
A great many questions remain about how these and the myriad other relief mechanisms in the historic $2 trillion dollar package are to be implemented. Treasury and the IRS have a lot of work ahead of them.
Click here to read the rest of the report from the Taxation Task Force.