< Foreign Workers Living Overseas Mistakenly Received $1,200 U.S. Stimulus Checks

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Lawmakers in the White House are trying for a deal on a coronavirus relief package. They say they might get it done by the end of this week. If that happens, it'll probably include a second round of $1,200 stimulus payments. The first round, there were mistakes. The IRS, you might remember, sent around $1.4 billion to dead people. And now NPR is learning there was another problem - stimulus money that was supposed to go to Americans went to foreign workers in other countries. Here's Sacha Pfeiffer's NPR investigation.

SACHA PFEIFFER, BYLINE: In a typical year, several hundred thousand foreign college students travel to the United States for temporary and seasonal jobs. They're often from Eastern Europe and South and Central America, and they work at ski resorts, amusement parks and beach destinations as waiters, lifeguards, hotel housekeepers and other low-wage positions. One of those foreign workers is a 24-year-old citizen of the Dominican Republic who spent last summer working at a Cape Cod grocery store. His former landlord on the Cape still receives some of his mail and recently forwarded him a check from the U.S. Treasury.

UNIDENTIFIED PERSON #1: Let me just describe it to you. It said, like, economy impact payments - President Donald Trump.

PFEIFFER: That's what the check said - economic impact payments, signed by President Trump.

UNIDENTIFIED PERSON #1: Yeah. Exactly.

PFEIFFER: NPR reached him in the Dominican Republic, where he's working and taking online classes. We asked if receiving that stimulus check had been a surprise.

UNIDENTIFIED PERSON #1: Well, yes, I was really surprised because I was not expecting that money.

PFEIFFER: NPR agreed not to identify the man because he's concerned having gotten a check could put him at odds with the U.S. government. Other foreign student workers he knows received stimulus checks, too.

UNIDENTIFIED PERSON #1: A couple of friends told me from the other countries - like Bulgarians, Jamaicans, Colombians, also Montenegro - they get the money also at the same time.

PFEIFFER: How many other people do you think you talked to, who did the summer work like you, who also got a check?

UNIDENTIFIED PERSON #1: I can say almost all get the money, almost all the people that I know, like a hundred.

PFEIFFER: The payments were intended to stimulate the U.S. economy by giving consumers spending money, but this Dominican man is not able to work on Cape Cod this summer because the Trump administration's freeze on foreign work visas has prevented seasonal workers from coming to the U.S. So he'll be spending his stimulus payment at home.

UNIDENTIFIED PERSON #1: This money, to be honest, is a big help because we can buy food. We can also pay the cable services. We also can pay the university.

PFEIFFER: This would be a university in the Dominican Republic.

UNIDENTIFIED PERSON #1: Exactly.

UNIDENTIFIED PERSON #2: I don't think that's fair.

PFEIFFER: That's the Dominican man's former Cape Cod landlord. NPR agreed not to identify him, either, because he worries speaking publicly could make him a target of the Internal Revenue Service. He still remembers his shock at finding economic impact payments in his mailbox for two of the foreign students he'd rented rooms to.

UNIDENTIFIED PERSON #2: I was saying to myself, is this a stimulus check? Why would they get a stimulus check?

PFEIFFER: He then learned that some foreign workers in Kazakhstan also got checks. He regards many of the students who've stayed with him as family but doesn't think they should get stimulus payments.

UNIDENTIFIED PERSON #2: Just because these kids aren't citizens. Like, these kids are all great kids, but they aren't part of the people that are suffering in this country that have no jobs and so forth.

PFEIFFER: Only U.S. citizens and U.S. resident aliens are eligible for stimulus money. The Dominican man interviewed by NPR and some of his friends do not meet that eligibility standard. The U.S. government acknowledges some stimulus checks were improperly sent to foreign workers and told NPR it's, quote, "exploring possible options" to prevent that from happening again.

Government officials and tax experts say the mistake happened because many foreign workers, often unintentionally, file incorrect tax returns that make them appear to be U.S. residents. They often file a form 1040 when they should file a 1040-NR, which stands for nonresident. Some foreign workers are now scrambling to amend their returns because they worry having mistakenly got a stimulus check will jeopardize their visa status or green card application or ability to return to the U.S.

ENDA KELLEHER: We saw a huge number of people contacting us after the first stimulus payment because they said, hey, I got this check. I never asked for it. I didn't think I was entitled to it. And how can I correct it?

PFEIFFER: Enda Kelleher is a vice president at Sprintax, which does U.S. tax preparation for nonresidents. He said Sprintax has clients from 129 countries who've tried to return stimulus checks, including Brazil, China, India, Nigeria and South Korea. How much stimulus money was mistakenly sent to foreign workers is difficult to quantify. But Sprintax did about 400 amended returns last year for people who mistakenly filed as U.S. residents. So far this year, it's done 5,000 - almost 5% of the total federal tax returns it filed last year. If just 5% of last year's more than 700,000 student and seasonal workers with F-1 and J-1 visas received a stimulus check in error, that would total $43 million.

CLAYTON CARTWRIGHT: Sure, it doesn't surprise me that that would have happened. Now, does that make good policy sense? Probably not.

PFEIFFER: Georgia Attorney Clayton Cartwright specializes in immigration tax law and has a background in accounting. He said Congress was in what he calls panic mode in March, as the American economy was shutting down due to the pandemic, so it rushed stimulus funding out the door.

CARTWRIGHT: You Know, damn the torpedoes, full steam ahead - we've got to get the money out. So they just do it and live with the consequences.

PFEIFFER: Including unintended consequences. The IRS says nonresidents who mistakenly received stimulus money should return it. But Kelleher of Sprintax predicts if more stimulus gets distributed, some foreign workers who sent back their first $1,200 check will get a second one.

Sacha Pfeiffer, NPR News.

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