Who is eligible?
An individual is considered eligible if he or she:
Consequences of exception
An individual who intended to leave the US during his or her COVID-19 Emergency Period but was unable to do so may exclude the individual’s Emergency Period days when applying the SPT. In addition, when considering if the individual qualifies for treaty benefits any days of presence during the Emergency Period during which someone couldn’t leave the US because of COVID-19 won’t be considered as US days of presence. Considering this, an individual who qualifies for the exception and earns income from employment or other dependent personal services during his or her Emergency Period in the US will still be able to exclude income from US taxation for tax treaty purposes.
How to apply?
In order to claim the medical condition travel exception, the individual needs to timely file a 2020 Form 1040-NR “U.S. Nonresident Alien Income Tax Return,” and attach Form 8843.
Individuals who are eligible but aren’t required to file a 2020 Form 1040-NR do not need to file Form 8843 but should keep relevant records supporting that they were eligible for the medical exception in the case of a request from the IRS.
In addition, any individual who qualified for the regular medical condition travel exception during anytime in 2020 may make the claim instead of or in addition to the COVID-19 medical condition travel exception. This applies to any period during 2020 for which he or she satisfies the requirements. Anyone claiming the medical condition exception for any period outside of his or her COVID-19 Emergency Period should file Form 8843 consistent with the applicable regulations and form instructions.
Finally, the procedure provides specific instructions for claiming an exemption from tax withholding on income from dependent personal services under a U.S. income tax treaty.
If you believe the medical condition travel exception may apply to you or someone you know, please contact Moore Doeren Mayhew. Thank you.