Back in August, the IRS said that thousands of foreign workers who entered the U.S. on temporary work visas, received $1,200 checks in error during the first round of CARES Act stimulus payment cycle.
At the time, the IRS said the mistake happened because those foreign workers, whether unintentionally or on purpose, file incorrect tax returns that make them appear to be U.S. residents.
Now, according to a report on NPR, the IRS acknowledges its own error caused the overpayment, and that the mistake is likely to happen again if more stimulus money goes out.
Only U.S. citizens and U.S. "resident aliens" were eligible for the May $1200 stimulus payments. NPR says "resident alien" is a federal tax classification, and to qualify an individual needs a green card or must have been in the U.S. for a certain amount of time.”
The Treasury Inspector General for Tax Administration reported that as much $34 million in stimulus money had gone to people who filed a tax return with a foreign address.
The $34 million includes eligible people, such as U.S. citizens living abroad, and excludes ineligible foreign citizens who received a check at a U.S. address. NPR interviewed a citizen of the Dominican Republic who was not eligible yet received a $1,200 economic impact payment at his former address in Massachusetts.
The $34 million also does not include people who received a check but did not file a U.S. tax return.
According to the NPR report, the government has put no mechanisms in place to prevent mistakes since the original CARES Act was passed in May, which means if a new relief plan with stimulus payments is approved, “some of that money is likely to mistakenly end up in mailboxes overseas again.”
U.S. Treasury officials said they are "continuing to assess the accuracy of the economic impact payments ... and the recovery efforts for any erroneous payments," NPR reported, and was told the IRS is "relying on individuals to voluntarily return these payments."
For the entire NPR article, including interviews with people who received the money in error, click here.