For those who’ve received a stimulus payment from the government, there was some relief this week. But, there are some who may have received payment who didn’t qualify, or so they thought.
Of the eligibility requirements set by the IRS, there is one that may not mean exactly what you think it does. The Non-Resident Alien criteria do not eliminate all foreign nationals from receiving assistance from the government. Elton Norman is an experienced business and tax attorney licensed to practice in the Northeast and sought to clear up this common misconception.
"A non-resident alien within the definition of the IRS is different [from] a nonresident alien for immigration purposes,” he said. “A resident alien with the IRS means someone who has what's called substantial presence in the United States. "
Non-resident individuals include those who are not U.S. citizens or nationals. Per the IRS, the substantial presence test is a criterion used to determine whether someone who is not a citizen or permanent resident qualifies as a "resident for tax purposes."
“You have to be here at least 31 days in the current year. And there's a formula you use that will be one-third of the time of the prior year, and then one-sixth of the time of the year, the year before that,” he said. “And when you add those all up if that comes up to 183 then you'll still be considered to have a substantial presence.”
Thus, you would be considered a resident for tax purposes only. It can be confusing, but an important distinction to make. As for other misunderstandings about this stimulus payment, Norman is hoping to ease some concerns.
“No, you will not be required to pay taxes on this stimulus payment,” he said. “It's a tax-free payment to anyone receiving it. And likewise, it would not be deducted from your refund if you got a refund next year either.”
For those concerned about the overpayment, Norman said you should not be worried about that at this time. “That can be adjusted later on,” he said.
He is encouraging you to log on to IRS.gov to check on the status of your payment. According to its website, the IRS will mail a letter detailing how your payment was made and how you can report any issues with it.