A Letter from our Managing Member, Diane Siriani
Hello to all of our clients, friends and associates. All of us at ExpatriateTaxReturns.com and EtaxService.com LLC sincerely hope and pray that all of you are safe and of good health. This pandemic has touched every single one of us in a way no one would ever believe. Every continent, every country, every city, every individual in the world has been affected…this virus knows no boundry.
As you know, the US government has extended the filing of all individual tax returns to July 15. Estimated taxes that were due in April and will be due in June are also extended to the July 15 due date. Penalties and interest will be waived on all individual tax payments that were due from February 15 thru July 15.
The stimulus payments in the form of a refundable tax credit have begun to be directly deposited into US bank accounts. As of this writing, the IRS portal system that was supposed to be available to individuals to submit their US bank account number, is still not 100% operational. Hopefully this situation will be corrected soon, so that your payment can be deposited rather than waiting for a check mailed to your last known address. We have sincerely tried to keep up with your questions and give you assistance whenever possible, but this portal situation has made servicing our clients very difficult. We are truly sorry for the inconvenience, but it is out of our hands.
Originally I was told by the AICPA that the foreign income exclusion would effect foreign taxpayers in their calculation of their adjusted gross income. As of today, this issue still has not been clarified so we, like you, will see what happens. So far the stimulus rules are silent on this matter.
Our goal during these trying times has been to keep you informed of updates and changes as they occur. We hope you feel that we have accomplished that goal. As each day passes, hopefully we will continue to see a transition to a new normal and feel some relief of the stress and strain we have all suffered over the last several months.
May you and your family continue to stay safe and healthy.
Diane Siriani, CPA
Managing Member, EtaxService.com LLC & ExpatriateTaxReturns.com
Q. EXACTLY WHAT ARE THE STIMULUS PAYMENTS?
A. On April 2, 2020, the US government signed into law a stimulus program to help US taxpayers through with the financial stress associated with the Coronavirus. Tax relief in the form of stimulus payments and SBA loans have been made available to qualifying individuals, small business, large business and nonprofit organizations.
Q. HOW WILL INDIVIDUALS QUALIFY FOR THE PAYMENTS?
A. Currently it appears that all US taxpayers who have a social security number and filed a tax return in 2018 or 2019 will qualify for these refundable tax credits.
Non-resident aliens, individuals who are reported as a dependent on another person’s return and those who have an ITIN (as opposed to a social security number) do not qualify.
If you have not filed, it is not too late, however your payment will be delayed until the returns can be processed. Don’t put off your filing requirement, there will be no payments made after December 31, 2020.
Q. WHAT ARE THE INCOME LIMITS TO GET PAYMENTS?
A. The most up to date information is based on your filing status and adjusted gross income (before the foreign income exclusion) ….
Single Under $75,000-$99,000
Head of Household Under $112,500-$136,500
Married Filing Joint Under $150,000-$198,000
For every $100 of income that exceeds the above minimums the tax credit will be reduced by $5 up to the maximum amounts.
Q. HOW MUCH CAN I EXPECT TO RECEIVE?
A. The maximum credit will be $1200 per taxpayer and $500 for each dependent child reported on your tax return that have a valid social security number. Remember, ITIN’s do not qualify.
Q. HOW WILL I RECEIVE THE FUNDS?
A. The payments will be directly deposited into your US bank account if it has been reported on your US tax return. If you receive direct deposit of social security, or any other government benefits, the stimulus benefits will also be directly deposited.
Q. WHAT HAPPENS IF I DO NOT HAVE A US BANK ACCOUNT OR THE IRS DOES NOT HAVE MY BANKING INFORMATION?
A. A check will be issued and sent to your last known address If you are not required to file a return, the IRS is working on creating a simplified document for which you can provide them with your bank account information. EXPECT AN 8-16 WEEK DELAY!
From the Desk of Diane Siriani, owner and Managing Member of Expatriate Tax Returns
As of today, the US Treasury Department and the Internal Revenue Service are providing special PAYMENT relief to individuals, estates, trusts and businesses in response to the COVID-19 Virus Outbreak. All income tax payments (including self-employment tax) are extended to July 15, 2020 without penalty or interest assessments.
THE FILING DEADLINE REMAINS APRIL 15, 2020. If you are a US individual resident or expat who owes tax, you must file your return or an extension by the April 15 due date to get payment, interest and penalty relief under this program. NO FILING, NO RELIEF!
If you are a C-Corporation, you will automatically receive the same payment extension date of July 15, 2020.
The payments that are extended are estimates due April 15, 2020, tax due per your filed return, extension payments due based upon your estimate of tax due. Payments extended for individuals are limited to $1,000,000; payments extended for C Corporations are limited to $10,000,000 of their 2019 tax due.
As of today’s writing, THIS EXTENSION ONLY APPLIES TO YOUR FEDERAL TAX RETURN. ALL STATE AND CITY RETURNS MUST BE FILED AND PAID BY APRIL 15, 2020 in order to avoid interest and penalty assessments.