H1B, L legal visa workers can receive IRS payment and it will not be considered a public charge by USCIS.
Check if you should return money to IRS using this snapshot:
|Married Filing Jointly||Eligible for Check|
|H1B/L1 SSN, H4/L2 Spouse ITIN,|
Child ITIN or
|H1B/L1 SSN, H4/L2 Spouse SSN,|
|H1B/L1 SSN, H4/L2 Spouse SSN, |
Child ITIN or Child SSN
You should return the money to the IRS if a child with ITIN was counted in the payment amount (only the portion for ITIN)
|H1B/L1 SSN, H4/L2 Spouse SSN, |
In the first stimulus check, IRS said that spouse should have an SSN on the Married filing jointly tax return to be eligible for the check.
You can claim the first check amount in your 2020 tax return if you were eligible but did not get one due to the above SSN+ITIN rule.
This article will discuss:
H1B is Resident Alien (L1, L2, H4 EAD)
For the purpose of income tax calculation in the USA, IRS considers H1B and L visa workers as ‘resident alien‘.
L2 EAD and H4 EAD are also resident aliens and they are eligible for check payment. You must be using the form 1040 to file your taxes either as single or married filing jointly to be eligible.
Examples of ‘nonresident aliens’ for tax purpose in US:
- The B1/B2 visa visitors.
- F1 study visa holders including students working on OPT/CPT. You may want to check with your CPA too as it is based on how much time you have spent in the US.
Under the Stimulus bill, single Americans would receive $600, married couples would get $1,200, and parents would see $600 for each child under age 17.
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The income level will be judged using your 2019 IRS returns or 2018 if the 2019 return was not filed.
Married but wife is not working?
It depends on how you filed your last tax return. Check your form 1040 from 2019 or 2018.
Many people file as “Married filing Jointly” even if the wife does not have a work permit in the USA. This is legal.
With H4 EAD, you do get SSN and then you will be eligible for a Stimulus check. The same holds true for L2 dependents.
Many H4 visa dependents use ITIN until they get their own H4 EAD.
Is Child SSN Mandatory?
The child should have a valid USA Social Security Number to be eligible for the child’s portion of the stimulus CARE Act payment.
- Many H1B and L worker visa holders would have a kid with ITIN but not SSN. You will not get a Child’s credit here.
- The US-born kids who are US citizens automatically get SSN and hence are eligible.
The payments will reduce for people with adjusted gross incomes of more than $75,000.
If your income is more than $75,000, you would not qualify at all. For families where both members are working, the income limit is 150k.
|Single/Family Income||Single||Married filling Jointly|
|Income Up-to $75k/150k||$600 + $600/Child||$1,200 + $600/Child|
|Income above $99k/$198k||Not eligible for Payment||Not eligible for Payment|
The stimulus check will not be considered a public charge as it is a tax credit.
Similarly, USCIS announced that Coronavirus medical help will not be counted as a public charge.
The direct payment check under the stimulus bill will not be taxed by the IRS.
The payment will be considered a tax credit and hence will not be taxed in the 2020 return.
You do not need to add it to your tax return as income in 2020.
IRS said that you can claim the stimulus check amount on your 2020 Tax return if you were eligible but were not sent a check for any reason.
It is possible that you may receive it automatically by the end of 2020 too.
Should H1B Return Check?
Should H1B Return Stimulus Check Payment back to IRS is a common question asked by many people. My answer is that it depends on your individual eligibility.
The check is being sent as a tax credit, which is legal if you had filed the tax return correctly using the form 1040.
You should consider returning the IRS stimulus check if you fall in these conditions (talk to a qualified CPA first to assess your situation):
- If you filed tax returns using a wrong form (like using the 1040 tax resident form when you should use 1040-NR, 1040NR-EZ, 1040-PR, or Form 1040-SS) and then got the check mistakenly, you should return the money to the IRS.
- H1B/L1 with SSN Outside USA in 2020 (worked and filed taxes in 2018 or 2019 in the USA) – If you are not a resident alien in the US in 2020 as per IRS substantial presence test, you should consider returning the money.
Here is what IRS officially said:
Instructions by IRS on how to return money if you have received it even though you were not eligible.