Getting payments from the US

We outline 2 solutions in this article to get a US bank account when living overseas. When the IRS needs to refund and/or pay money to citizens the two most common ways are per cheque or via direct deposit into your US bank account. 

Some background

Cheques have a challenge that it takes long(er) to receive them and in some cases it’s hard to cash cheques since this system is outdated. Also, a lot of European banks in 2020 decided not to cash cheques anymore. This means that even if you receive your cheque you might have a very hard time getting it deposited into your bank account.

Generally US banks regularly ask for a US residency address and require all kinds of US based information that most people don’t have. These banks have also been known to insist on an in person visit for signing documents. They’re simply not (well) equipped to handle Americans living Overseas.

We have done research into several options for receiving payments from the IRS and have listed our findings below. The first option can be used if you’re about to receive money.  The second option is for people who have already received their cheque in the mail and can’t cash it at their bank.

Option 1: Transferwise

If you don’t have a paper cheque yet from the IRS and need to receive money then we consider Transferwise as the best option to get a free online US bank account. Once you sign up you need to deposit € 20,- into your account to activate your US bank account. The € 20,- can be returned to you after activation minus a 0,60 cent commission they charge. 

You can use the banking details provided by Transferwise and submit those to the IRS and receive money directly into your account (direct deposit). See the Example below.

We have made an agreement with Transferwise that you wont be charged a fee when you exchange your first $220 to Euro’s if you register via below link. Full transparency: In some events we will receive a small commission from Transferwise.  Please direct all questions about the service to Transferwise directly if you have them.

Visit Transferwise


Option 2: SDFCU

If you already have a paper cheque and are having trouble exchanging it at your local bank then you have two options. You might, in rare cases, be able to cancel the cheque and request a direct deposit. In which case you can still use above option. 

The second option is to open a free account with the SDFCU (State Department Federal Credit Union). Although the name sounds like it is government related it is not we have been told.  It is a little harder to open your bank account there because you always need a Social Security Number and in some cases even the original SSN certificate (see example image) which shows your number. They’re very strict and will not deviate from any of their requirements.

SSN certificate example

The account they offer is free of charge. Only after one month when opening the account you can use their ‘remote deposit’ service to cash a cheque. This service can be found via their website once you’re logged into your account. The mobile app also has several functions but is meant for residents in the United States. Please direct all questions about the service to the SDFC directly if you have them.

While we have done our utmost best to research the best options this should not be considered as financial advice. We urge readers to do their own due diligence and can’t accept any liability arising out of actions taken due to this article.