August 8, 2020

Volume X, Number 221

August 07, 2020

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August 06, 2020

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IRS Continues to Provide Relief for Nonresident Aliens in the Wake of COVID-19

The Internal Revenue Service (IRS) recently posted a set of frequently asked questions (FAQs) on its website to provide additional information on Revenue Procedure 2020-20. The IRS published this revenue procedure on May 11, 2020, to provide relief for certain nonresident aliens stranded in the United States due to COVID-19-related travel restrictions. The new FAQs provide relief for certain nonresident aliens who may be forced to remain in the United States longer than anticipated because of a medical condition. As indicated in our prior article on Revenue Procedure 2020-20, an extended stay could adversely affect a nonresident alien’s classification for federal income tax purposes.

A nonresident alien who becomes ill while in the United States may be able to claim a medical condition exception to exclude certain days he or she intended to leave the country but was unable to do so because of the illness. To claim the medical condition exception, the nonresident alien generally must file IRS Form 8843, Statement for Exempt Individuals and Individuals With a Medical Condition, which requires a signed physician’s statement. In the FAQs, the IRS acknowledges that it may be difficult for an individual to obtain a physician’s statement during a pandemic. Therefore, the IRS provides procedural relief. A nonresident alien who is otherwise eligible to claim the medical condition exception may file the Form 8843 without a physician’s statement to cover a period of up to 30 consecutive days in 2020 (referred to as the 30-day exception). Notably, a nonresident alien may be eligible for relief by claiming multiple medical condition exceptions under Revenue Procedure 2020-20 and the 30-day exception provided for under the FAQs.

The FAQs describe the type of documentary evidence that a nonresident alien should retain to substantiate a claim for both types of relief. The FAQs also describe how to complete the Form 8843.

In general, FAQs provide unofficial IRS guidance. However, the information in the new FAQs may be helpful until the IRS issues more formal guidance.

© 2020, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., All Rights Reserved.National Law Review, Volume X, Number 191


About this Author

Deborah Andrews Employee Benefits & Executive Compensation Attorney Ogletree Deakins Washington D.C.
Of Counsel

*Licensed to practice in North Carolina and Georgia only. Practice in D.C. under supervision pursuant to Rule 49 of the D.C. Court of Appeals.

Ms. Andrews’ practice encompasses a broad range of employee benefits and executive compensation matters, including compliance with the Internal Revenue Code, ERISA and the Affordable Care Act. She regularly represents clients before the Department of Labor and the Internal Revenue Service regarding the correction of plan document and operational failures.

In addition, Ms. Andrews provides guidance on executive compensation issues and...

Michael K. Mahoney, Ogletree Deakins, employee benefits attorney

Mr. Mahoney is a member of the Employee Benefits and Executive Compensation group. He focuses on employment tax matters at both the federal and state levels, the review of labor and tax laws governing qualified plans, and the strategic design of executive compensation plans for a global workforce.

Mike advises employers on a multitude of fringe benefit issues including tax advantageous means of structuring such benefits. He routinely assists clients resolve payroll audits, working with federal and state authorities to reduce assessments on behalf of employers. In performing due diligence, he provides counsel through mergers and acquisitions to identify and quantify exposure resulting from, among other items, worker misclassification and accountable expense plan failures. He navigates employers through risk mitigation strategies during integration following an acquisition or merger, including the Voluntary Classification Settlement Program.

Randle Pollard Employee Benefits Lawyer Ogletree
Of Counsel

Randle Pollard is a member of the Employee Benefits and Executive Compensation group. He focuses on employment tax matters at both the federal and state levels, the review of labor and tax laws governing qualified benefit plans, and advises client on the taxation of employee fringe benefits.

Randle has over twenty years of tax law experience as in-house counsel, and from prior positions within government, public accounting, and academia. In addition to his practice with Ogletree Deakins, he is a member of the law faculty at American University,...