Recovery Rebates and Unemployment Compensation under the CARES Act: Immigration-Related Eligibility Criteria

Recovery Rebates and Unemployment Compensation under the CARES Act: Immigration-Related Eligibility Criteria

Legal Sidebari

Recovery Rebates and Unemployment
Compensation under the CARES Act:
Immigration-Related Eligibility Criteria
April 7, 2020
This Legal Sidebar reviews the immigration-related eligibility requirements for two types of benefits
established by the CARES Act: (1) the recovery rebates under Section 2201; and (2) the various forms of
federally funded unemployment insurance (UI) benefits under Title II, Subsection A. Both benefit types
are the subject of other CRS products and have other eligibility rules not related to immigration status.
This Legal Sidebar focuses only on the extent to which non-U.S. nationals (aliens) may qualify for the
benefits. (For a general overview of the recovery rebates and unemployment compensation programs set
forth by the CARES Act, see here and here.)
The following Table provides an overview of the immigration-related restrictions for each benefit type.

Immigration-Related Restrictions
Recovery Rebates
1. Must have social security number.
2. Must not be a “nonresident alien” for tax
purposes.
Unemployment Insurance
1. Must have work authorization; state law
may establish stricter requirements.
2. Possibly: Must be a “qualified alien”
(applicability of 8 U.S.C. § 1611 remains
unclear).
Source: Provisions of the CARES Act and other federal laws analyzed by CRS.
Congressional Research Service
https://crsreports.congress.gov
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Recovery Rebates
Social Security Number Requirement: The CARES Act prohibits payment of the recovery rebate to
anyone who does not include a social security number (SSN) on their tax return for the taxable year. Joint
filers must include an SSN for both spouses, unless one spouse is in the Armed Forces. For any qualifying
child, parents must include the child’s SSN or adoption taxpayer identification number. It appears from
the language of the Act that a parent without an SSN may not claim a credit for a qualifying child, even if
the child has an SSN, although to date the IRS has not published guidance on this issue.
The Social Security Administration (SSA) issues SSNs to aliens who are authorized to work in the United
States—including aliens who apply for and receive employment authorization documents after obtaining
Deferred Action for Childhood Arrivals (DACA), Temporary Protected Status (TPS), and other so-called
“quasi-legal” statuses.
Although the SSA also issues SSNs to aliens who lack work authorization but need a number to obtain
benefits or services, such non-work numbers do not fulfill the SSN requirement under the CARES Act.
Specifically, the Cares Act defines the requirement in such a way (by reference to a provision in the
Internal Revenue Code which, in turn, references a provision of the Social Security Act) as to allow it to
be satisfied only by an SSN that the individual acquired on the basis of being a U.S. citizen, lawful
permanent resident (LPR), or an alien authorized to work in the United States.
Nonresident Alien Exclusion: The CARES Act excludes “any nonresident alien individual” from
eligibility for the recovery rebates. Under the Internal Revenue Code, “nonresident alien” means any alien
who does not satisfy one of two criteria: (1) the alien is an LPR; or (2) the alien satisfies the “substantial
presence” test. The IRS explains the substantial presence test as follows:
To meet th[e] [substantial presence] test, you must be physically present in the United States
(U.S.) on at least:
1. 31 days during the current year, and
2. 183 days during the 3-year period that includes the current year and the 2 years immediately
before that, counting:
o All the days you were present in the current year, and
o 1/3 of the days you were present in the first year before the current year, and
o 1/6 of the days you were present in the second year before the current year.
The substantial presence test has special rules for some aliens considered “exempt individuals,” such as
nonimmigrant diplomats and students, and other aliens who demonstrate a closer connection to a foreign
country.
Immigration lawyers sometimes use the term “nonresident alien” to mean an alien who is not an LPR,
even though the Immigration and Nationality Act does not define the term. That colloquial usage does not
apply to the eligibility criteria for recovery rebates under the CARES Act; instead, because the relevant
provisions of the CARES Act amend the Internal Revenue Code, the definition of “nonresident alien” in
the Internal Revenue Code governs.
Takeaway. Broad categories of work-authorized aliens living in the United States, including many DACA
and TPS recipients, will be able to qualify for the recovery rebates because they have SSNs and are
resident aliens for tax purposes. Aliens who do not have SSNs—including unlawfully present aliens who
pay taxes using individual taxpayer identification numbers (ITINs)—are not eligible for the rebates.

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Unemployment Insurance
Less clear are the immigration-related eligibility requirements for federally funded UI benefits under the
CARES Act. Whereas eligibility for the recovery rebates depends on requirements set forth in the CARES
Act, UI eligibility issues turn partly on the interaction between the CARES Act and other provisions of
federal and state law.
Work Authorization Requirement and the Potential “Qualified Alien” Restriction
Under the baseline requirements established in the Federal Unemployment Tax Act (FUTA), aliens
typically qualify for regular UI benefits if they are authorized to work (both at the time they perform
qualifying work and when they apply for and receive benefits). States may establish stricter rules.
The baseline rule for regular unemployment benefits may change for CARES Act benefits, however.
Regular UI benefits are funded by state taxes. But the CARES Act establishes, among other provisions,
federal funding for three major UI programs (Pandemic Unemployment Assistance, additional weeks of
benefits, and additional $600 in federal weekly compensation), as explained further in another CRS
product. Such federal funding may trigger the restriction in 8 U.S.C. § 1611, a provision of the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), which limits eligibility for
“federal public benefits” to “qualified aliens”—a restrictive term that only covers certain groups
enumerated in statute, such as LPRs, asylees, and refugees. If this restriction applies to the CARES Act
programs, some categories of aliens who have work authorization and are generally eligible for regular UI
benefits would not qualify for them. Examples include DACA recipients, TPS holders, and many
applicants for asylum.
Executive branch agencies have determined that another federally funded unemployment benefit—
Disaster Unemployment Assistance (DUA)—is restricted to “qualified aliens” under PRWORA. And on
at least one occasion, in 1998, the Department of Labor expressed the same conclusion with respect to all
UI benefits paid in part with federal funds. Yet there’s a dearth of federal caselaw to confirm that
conclusion, and more recent Department of Labor (DOL) guidance about alien eligibility for UI does not
mention PRWORA. Also, specific language in the CARES Act, such as the provision that makes
Pandemic Unemployment Assistance available to people who are “not eligible for regular compensation
or extended benefits under State or Federal law,” might be interpreted to override PRWORA. Future DOL
guidance about the CARES Act could clarify the agency’s position on this issue, although the DOL
guidance issued thus far does not address it.
Nonimmigrant Issues
Many holders of nonimmigrant work visas, such as H-1B visas for specialty occupations and L visas for
intracompany transferees, face a unique bar to eligibility for unemployment benefits. If PRWORA applies
to benefits under the CARES Act, such nonimmigrants would not be eligible because they are not
“qualified aliens.” But even under the baseline work-authorization requirement for regular UI under
FUTA, many nonimmigrant workers do not qualify under the case law in some states because they’re not
considered “able and available to work” when they are unemployed. The terms of their visas authorize
many nonimmigrant workers to work only for a single employer. Losing a job with that employer
therefore means losing their work authorization, under the analysis of some state cases. Even though H-
1B and some other nonimmigrant workers have flexibility to change employers, federal law requires the
new employer to file a new visa petition before the employee may work (and for some visa categories, the
petition must be approved first). Thus, the analysis goes, if a nonimmigrant worker has lost a job and does
not have a new visa petition filed by a new employer, the worker is not “able and available” to work and
does not qualify for benefits.

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Takeaway. The specific UI benefits made available under the CARES Act are federally funded and might
therefore be restricted to “qualified aliens” – a term that PWRORA defines to exclude unlawfully present
aliens as well as some aliens whose presence is authorized. Even so, states may continue to grant regular
UI benefits to aliens with work authorization, but alien eligibility for such regular UI benefits may vary.
For example, under the case law of some states, nonimmigrant workers whose visas allow them to work
for only one employer may not qualify for regular UI benefits upon being permanently laid off.
Note about Public Charge
An alien’s receipt of the recovery rebate or unemployment compensation is not to be factored into
determinations made under the new Department of Homeland Security (DHS) public charge rule about
whether the alien is ineligible for LPR status due to likely future dependence on public benefits. That’s
because neither type of benefit appears in the exclusive list of benefit types that count as “public benefits”
under the rule. In the preamble to the rule, DHS explained that it considers unemployment compensation
an “earned benefit” not appropriate for public charge consideration. DHS also explained its decision not
to consider other types of tax credits under the rule, such as the Earned Income Tax Credit and the Child
Tax Credit: “DHS is not including tax credits because many people with moderate incomes and high
incomes are eligible for these tax credits, and the tax system is structured in such a way as to encourage
taxpayers to claim and maximize all tax credits for which they are eligible.” That said, DHS could amend
the rule in the future to add new types of benefits to the list of those considered for public charge
purposes, but it seems unlikely to do so for unemployment benefits and tax credits given these recent
statements. (On a related note, DHS has stated that “medical treatment or preventive services” related to
COVID-19 “will not negatively affect any alien as part of a future Public Charge analysis.”) Also, in the
past, when DHS has changed the public charge regulations to bring more benefit types under
consideration, it has not made those changes retroactive.

Author Information

Ben Harrington

Legislative Attorney

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of

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