Should Foreign Workers Receive Background Checks for Stimulus Funds?

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Foreign workers received $1200 stimulus checks in error during the first round of U.S. stimulus payments this year. Citizens are putting pressure on Congress to enforce background checks before issuing funds in the future. These were workers who entered the country on temporary work visas and now, many of those same workers are spending the stimulus funds in their own nations.

NPR spoke with one tax  prep firm that stated it had clients from 129 countries that were mistakenly given stimulus money, including China, Nigeria, South Korea and India.  Tax experts say that many foreign workers provide incorrect returns which appear to reflect that they are U.S. residents. Some foreign workers in this class are trying to amend their returns in fear of it being a reason for rejecting their visa status.

It’s also difficult trying to figure out just how much money was mistakenly sent to foreign workers but according to many tax preparer estimations, experts say it could total in well over $40 million.

But this isn’t the first time a stimulus error has been made with non-U.S. residents. There were also nearly $1.4 billion in stimulus checks sent to dead Americans. While Congress debates on another release of stimulus package checks, it is taking into consideration the exclusion of the deceased but may not include provisions for foreign workers filing erroneously.

Many of the recipients are college students from South and Central America who travel to the U.S. for seasonal low-wage jobs like lifeguards, housekeepers at resorts and beach escapes. The U.S. issues about several hundred thousand visas to students each year.

Sometimes the checks were mailed to their former U.S. addresses and other times the checks were direct deposited to the last account listed on file. While the checks were intended to stimulate the U.S. economy by putting spending power back in the hands of American residents, it has in some cases been keeping our country’s foreign friends afloat during this time as well. Due to Trump’s freeze on foreign work visas, those seasonal workers would be unable to come to the U.S. for their usual work anyway.

One of the main reasons for these tax returns errors is the fact that many foreign workers, who are supposed to be filing the 1040-NR (“NR” for non-resident), are in fact filing the regular 1040 return. 

Should background checks be used to discern between actual U.S. workers and their foreign counterparts who only work seasonally and live abroad? On one hand, it may provide an added protection in favor of saving money that could be adequately used for Americans. However, doing so could also prevent immigrant American citizens from getting the funds they need.