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Foreign Spouses Stop Tax Rebate For Some

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The Associated Press

Published: May 12, 2008

SAN FRANCISCO - When Maulit Shelat heard about the Bush administration's plan to pump up the economy by sending out stimulus checks, he sat down with his wife and drew up a list of priorities: first up, remodeling the bathroom.

But Shelat is married to a foreigner who still hasn't completed the often years-long process that allows her to apply for a Social Security number. Her lack of a Social Security number makes him ineligible for the tax rebate because they filed jointly.

He is among the estimated hundreds of thousands of taxpayers - from legal immigrants to troops abroad - who won't be getting a share of the stimulus package because of a provision aimed at preventing illegal immigrants from getting rebates.

When lawmakers decided to send out the checks, ranging from $300 to $600 per adult taxpayer, plus $300 for each child, they formulated it so only taxpayers who have Social Security numbers would qualify.

The rule unintentionally affected many taxpayers who would have qualified for the bonus, except that they filed jointly with a spouse whose immigration status doesn't allow them to have a Social Security number. Among them are some of the 288,000 troops stationed overseas who may have married a foreigner.

There are also an estimated 1 million legal residents - immigrants with green cards - who are waiting for their spouses' paperwork to be processed, according to Paul Donnelly of Reform the Rebate, a group trying to push Congress to change the rule. The IRS doesn't keep numbers of how many are cut out of the rebate because they filed jointly.

Many of the couples snagged by this provision weren't aware that filing taxes using the foreign spouse's IRS-issued Taxpayer Identification Number would cut them out. On April 14, the day before the tax deadline, the IRS clarified the situation on its Web site.

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