The IRS Mistakenly Sent Stimulus Checks to Non-Americans, and It May Happen Again

United States Treasury Department officials acknowledged this week that millions of dollars worth of $1,200 stimulus checks were sent in error to foreign workers living in more than 150 countries. Tax experts say the IRS doesn't have the "bandwidth" to track down the relief money, much of which was sent to ineligible foreigners alongside President Donald Trump's signature addressing, "My Fellow American."

Thousands of noncitizens overseas who were previously employed in the U.S. on temporary work visas received $1,200 checks in error during the first—and only—round of coronavirus pandemic stimulus payments earlier this year. The IRS acknowledged to NPR Monday they are "relying on individuals to voluntarily return these payments" from abroad. As was first reported in August, countless confused noncitizens received the stimulus payments after filing incorrect tax returns, which made them appear to be U.S. residents.

Tax preparation firms say thousands of their clients living abroad received the $1,200 stimulus relief payments after Congress passed the Coronavirus Aid, Relief and Economic Security (CARES) Act without any tools to prevent such mistakes. If lawmakers pass a second stimulus package, tax experts say, these same foreigners would once again receive this money despite many not even filing U.S. tax returns at all.

One Swedish citizen living in Stockholm received the Trump-signed check in the mail in July, prompting her to ask, "How much money is bleeding out from the Treasury Department?" Federal government officials admitted this week they are unable to accurately answer that question despite a late May report which found $34 million had already been sent to people who filed a U.S. tax return from a foreign address.

"I thought: I can't believe it," said Susanne Wigforss, 78, in an interview with NPR this week. "They're sending it to me. Why? I mean, it's crazy, isn't it? This is so wrong because I saw that a number of people were being evicted every month in Chicago, for instance, and I thought one of those families would have needed this stimulus check. Why should a Swedish citizen living abroad receive $1,200?"

Treasury Department officials stated they are "continuing to assess the accuracy of the economic impact payments…and the recovery efforts for any erroneous payments. The IRS warned that these non-U.S. citizens living in their home countries would likely receive such payments again should Congress finally pass a second large-scale stimulus package.

Newsweek reached out to officials within the Treasury and IRS Tuesday morning for additional details on the millions mistakenly sent overseas.

One tax preparation firm told NPR in August that their clients across 129 countries had received stimulus checks while living in their home nations ranging from Brazil to China to Nigeria.

"I think the poor folks in the IRS don't have the bandwidth to go chasing this," said Enda Kelleher, vice president at Sprintax, an American tax preparation firm for nonresidents. "But it would be great if they did, because I believe that there's millions of dollars that have gone to people that weren't entitled to it, or they're certainly not the intended recipients."

"It's awful when we hear of millions of dollars going into the wrong hands, but it was probably within a somewhat acceptable threshold of error or margin of error," Kelleher added, noting that Congress chose speed over accuracy when it passed the $2.2 trillion economic stimulus bill last March.

Many of the ineligible foreigners who received the stimulus payments have either raced to cash the checks before the U.S. government gets wise, or they have expressed concern it could hurt future attempts at working in America again.

University students who spoke with Politico this week said they are "worried its either going to affect my status now or affect it if I ever try to apply for a different visa in the future."