Confused Japanese Receive $1,400 Stimulus Checks From US IRS

A 79-year-old man living in Japan was left confused after receiving a $1,400 stimulus check from the U.S. Department of the Treasury.

The Japanese man, who lives in Kamakura, Kanagawa Prefecture, received a mail printed in English in April. The mail, which had come from the U.S. treasury department, contained relief payments worth $1,400 (153,000 yen). His wife also received a check for the same amount.

The $1,400 stimulus payments are part of the Biden administration’s $1.9 trillion American Rescue Plan.

The Kamakura man thought the stimulus payment was related to his monthly Social Security payment of $500 from the U.S. government. He previously worked at a major Japanese electronics company and was stationed at its affiliate in the U.S., according to The Asahi Shimbun.

He paid Social Security taxes during his five years of employment. Under the Japan-U.S. bilateral agreement, the man and his wife receive monthly payments. But the U.S. Treasury check did not come with any explanation.

The man called a Japanese bank to inquire how to cash the checks. However, he was told that the checks were intended for U.S. citizens. He later sent an email to the U.S. Embassy in Japan, asking whether a Japanese citizen can cash the stimulus payments.

The embassy replied to him, saying: “We are aware that this affects U.S. citizens in Japan, especially those who do not have a U.S. bank account.”

The embassy told the man that the matter is under the jurisdiction of the Internal Revenue Service and included a phone number to call the IRS. But the man decided not to call the IRS and instead placed the checks in a file.

“Only because I don’t want to go through all the trouble to make an international phone call,” he said, adding: “I don’t know what to do from this point forward.”

There are over 70,000 people living in Japan receiving Social Security benefits from the U.S. government based on the Japan-U.S. totalization agreement enacted on Oct. 1, 2005.

Donna Kepley, president of international tax consulting firm Arctic International LLC, said she thinks that the IRS made a mistake connecting the stimulus payments to people receiving monthly benefits under the totalization agreement.

She said that it is illegal for Japanese citizens who live in Japan and are not green card holders to cash the checks. She also warned that if they don't return the payment, they could get a warning letter from the IRS.

“So, the way it works in the United States is that if you get a payment that is incorrect and you keep it, then when you get caught, when the IRS contacts you, you have to pay the money back plus a penalty plus interest on the money because you’ve had it to use,” Kepley said.