Democrats Abroad has published a submission to the Senate Finance Committee in response to its proposal "Overhauling International Taxation".  In our submission we make the case for reforming the way the Repatriation Tax and GILTI Tax impact Americans abroad.  Click here to download our submission.

Having a Congress that understands and supports the Americans abroad community is essential to building critical Congressional support for our reform recommendations. That's why we are working to increase membership in the  Congressional Americans Abroad Caucus - a group of Congressional leaders motivated to address the unique issues of the Americans abroad community.

Invite your Congressperson today to join the American Abroad Caucus. Find a script, ways to get in touch and more details about the caucus here. 

The Americans Abroad Caucus is currently chaired by Rep Carolyn Maloney. The caucus helps guide us when we have reforms to present, problems that require government support or questions that relate to the federal government. They are critical help in our work to provide tax relief for Americans abroad, plus expand voting rights, address our immigration issues, and so much more.

We have prepared this Campaign Guide which includes everything you need for participating in the Americans Abroad Caucus Campaign.  If you have any questions about the campaign or the advice in the guide please send questions to [email protected]

Thank you for your support for this campaign and for our work on behalf of the Americans abroad community.

Herein we have included the announcement made by the IRS on Wednesday 14 April about progress made in paying out the 3rd round of pandemic aid payments (Economic Impact Payments or EIP3) to eligible Americans.  In brief it says to date 159m EIP3 payments worth $376m have been distributed, rolling out on a weekly basis, most via electronic transfer.  Payments in this 5th batch include "top ups" to EIP2 or EIP1 for those whose 2020 income made them eligible for a higher payment than the ones made earlier based on their 2019 income. 

Although payments are automatic for most people, the IRS continues to urge people who don’t normally file a tax return and haven’t received Economic Impact Payments to file a 2020 tax return to get all the benefits they’re entitled to under the law, including tax credits such as the 2020 Recovery Rebate Credit, the Child Tax Credit, and the Earned Income Tax Credit. 

Filing a 2020 tax return will also assist the IRS in determining whether someone is eligible for an advance payment of the 2021 Child Tax Credit, which will begin to be disbursed this summer.

The full IRS update on EIP3 is included at the end of this post.

CONTACTING THE IRS ABOUT YOUR EIPS

This information is for those seeking advice on contacting the IRS as an American abroad to inquire about your Economic Impact Payment.

The correct IRS helpline for EIP assistance for Americans living outside the U.S. is 1-267-941-1000.

• “Press ‘1’ for English”
• There’s information about the website for questions about economic impact payment information, followed by a series of options
• “If you are calling outside the US, or need assistance with an international tax issue press ‘4’ ”
• “For questions about your individual refund, press ‘1’ 

We encourage you to reach out to the IRS for assistance.  Please let us know what you think of the support and service.

Read on for the entirety of the IRS EIP3 update report.

On March 25 the Senate Finance Committee held a hearing on "International Tax Policy and the Impact on American Workers, Jobs and Investment".  Democrats Abroad provided written testimony to the Committee hearing to raise the issues Americans abroad face in complying with U.S. taxation and financial account reporting compliance.  You can download the Democrats Abroad submission here.  You will note that we have joined our colleague organizations advocating on behalf of the Americans abroad community in asking for hearings on U.S. Taxation and Americans abroad and a switch to Residency Based Taxation.

Democrats Abroad continues to receive messages with questions about pandemic aid and how to access it.  If you have questions we encourage you to read on and also to:

1. review our past postings about accessing the first two aid programs and about how to cash a U.S. government check from abroad;
2. view a recording of our webinar about the second round of COVID aid; and
3. consider attending one of these upcoming tax webinars being hosted by DA Country Committees. 

The next (third) round of pandemic aid for individuals is coming as part of the American Rescue Plan, which was passed in the Senate this past weekend.  The bill is widely expected to be passed by the House and signed by President Biden by the end of the week commencing Monday March 8. 

We think this is the best reporting on the American Rescue Plan aid to individuals, or Economic Impact Payment 3 (EIP3) e.g. eligibility; how to get the $1,400 payment; how and when it will come.  Read on for further advice on positioning yourself to receive EIP3 as quickly as possible.

In line with the Democrats Abroad 2020 outreach to Treasury Sec Mnuchin and IRS Commissioner Rettig regarding the delivery of pandemic relief to Americans abroad, and with the American Rescue Plan with its $1,400 pandemic aid payment expected to be signed by President Biden later this week, Democrats Abroad has written to Biden-Harris Treasury Sec Janet Yellen requesting changes to improve both aid delivery efficiency and agency engagement with the Americans abroad community.

The IRS announced on 16 February 2021 that all first and second round Economic Impact Payments (EIP) have now been issued.*  Get My Payment, the online IRS platform for taxpayers to track EIPs, was last updated on Jan. 29, 2021, to reflect the final payments and will not be updated again for EIP1 or EIP2. 

What if you are still waiting for your payment?

These are updates from the Democrats Abroad Taxation Task Force on our work advocating for relief for Americans abroad from U.S. taxation and financial account reporting. In 2021 we will also carry on our work from 2020 to improve the access of Americans abroad to pandemic aid.

**Update**

PayPal is now allowing you to deposit your stimulus check for free with a US PayPal account. This requires setting up a free PayPal account but you need to verify it with a US phone number. More information on how to cash your stimulus check for free with PayPal is here.

1. Make inquiries with banks in the country where you live about U.S. Government check cashing facilities.

Not all banks do, but at least a few in each country are likely to. They may or may not charge a fee. You will need to inquire.

The following banks accept U.S. checks. If you know of any more, please email us so we can add more to the list:

• Lloyd's Bank (UK)
• Bank of Scotland (UK)
• NatWest (UK)
• Barclays (UK)
• HSBC (International)
• DKB (German online bank)
• Sparda Bank (Germany)
• Sparkassen (Germany)
• UBS (Switzerland)
• Credit Suisse (Switzerland)
• Crédit Agricole (France)

2. Sign the check over to a friend or family member with a U.S. bank account.

Keep in mind that this person doesn't have to be in the U.S. or even a U.S. citizen in order to cash the check for you. It can be anyone with a U.S. bank account that you trust. And keep in mind that not all U.S. banks allow signing a check over remotely. The process for how to sign a check over is explained in this article. It's a lot simpler than it may initially sound, especially for those that have lived outside the U.S. in a country where checks are not typically used. 

But you do need to trust the person to make sure that once the money is in their account, they'll definitely transfer the money to your account. So if you go this route, be sure you pick someone that you trust.

3. Open a U.S. bank account.

There are a number of commercial banks that will allow you to open a U.S. bank account from a non-US address. They may charge you to open an account or require some other fee(s). This is obviously less than ideal, but if it solves the problem then it might be worth the effort.

You can set up a U.S. bank account with the State Department Federal Credit Union if you live abroad and have no U.S. address. SDFCU accounts are not free of charge. See here for details.

4. Call the IRS

You can call the IRS, explain your situation, and ask if there are any other options available for you to get the money. They may say that you can wait to claim it back on your next tax return filing; that means a long wait which may be intolerable in your situation. But it's worth a try to see what options the IRS may make available.

5. Contact your Members of Congress and seek assistance from the constituency services staff.

This is your absolute last resort option when:

• You can't open a new U.S. bank account or an account at a local bank that will cash the check;
• You don't have any friends or family you can sign the check over to; and
• You can't wait until your next tax return is filed.

You can go to this website to find your House representative. You'll enter your zip code for the last place you lived at in the U.S. to find your representative (if you've never lived in the U.S., then use the address of the last place in the U.S. your American parent lived). Go to their website, click on the "constituency services" section, fill in the form with your issue and select the IRS as the agency you'd like your representative to contact on your behalf. A member of staff should reply to your message within 2 weeks.

HOW TO AVOID PROBLEMS WITH CASHING CHECKS

Democrats Abroad has received hundreds of messages from Americans abroad unable to cash their U.S. stimulus checks over the last year. When Congress passes legislation implementing the American Rescue Plan, more checks will come. If you are one of those who have been unable to cash a pandemic aid check we recommend you ready yourself for the next round of payments to ensure it can be paid via a bank transfer rather than a U.S. government check, which can be difficult to cash if you don't have a US bank account and your local bank won't cash a US check.

1. Provide the IRS with a U.S. Bank account using the Get My Payment Tool.

At this stage, the IRS is not making pandemic aid payments to non-U.S. bank accounts. Democrats Abroad wrote to the IRS 4 times last year asking them to give Americans abroad the option of having pandemic aid paid via electronic transfer to non-U.S. bank accounts; we await a response from Treasury.  

The next best option to having the aid paid by direct deposit into your local account is to have the aid paid by direct deposit into a U.S. bank account the IRS has on file for you. To send the IRS a U.S. bank account number LOG ON TO THE IRS GET MY PAYMENT TOOL.

2. Open an online money transfer account and give the details to the IRS using the Get My Payment Tool.

Transferwise.com is a well-known service that allows you to transfer money between countries, but they can also provide you with U.S. bank details so you can receive transfers directly from the IRS into your Transferwise account. You can then transfer the money to your local account. Although it's free to open a Transferwise account, keep in mind that there might be transfer and exchange rate fees. Also opening a Transferwise account is not the same as opening a U.S. bank account, so they can't cash a check for you.

We received reports for the first two economic stimulus payments that many Americans abroad provided their Transferwise U.S. bank details to the IRS using the Get My Payment Tool, and they were able to receive the money without any issues. Although occasionally the Transferwise bank details didn't work, which then triggered the IRS to send the payment via check in the mail. So keep this in mind that there is still a risk that it may not work. There are a number of other online money transfer services that offer similar services that might be able to do the same thing, although Transferwise was the main one we heard from members that worked the most often.

Here is the recording of the webinar we hosted on how to obtain the $600 stimulus payment as an American abroad.

Click here to download the slides from the presentation