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The software is not correctly calculating the credit for the child born in 2020. The client is entitled to $1100 for him and the program does not calculate it. I calculated it manually on the IRS worksheet! Please advise how to enter the data to have the calculation in the program correctly give them credit.
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Don't yell at us; we're volunteers
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And double check that the child is showing up as a dependent on the 1040, in case you entered something wrong about the dependent.
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Did you enter the child's date of birth and SSN?
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I am having the same issue. The software is using the 2020 income which is over the threshold. How can I input the 2019 amounts so that the credit can be properly claimed for the dependent born in 2020?
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There is no provision for using 2019 income for the stimulus.
You are confusing the Earned Income Credit, which has a lookback provision, with the Recovery Rebate Credit.
Perhaps it would help to review what is really happening:
The funds were paid out as Advanced payment against a projection. The projection used 2018 or 2019 tax returns. But 2020 is the Actuals. You use the 2020 return to reconcile what a person is entitled to, against what they got.
If the person is not a dependent in 2020, then they would be entitled to the payment/credit as individual filers. That doesn't mean "not being claimed." It means "no longer qualifies as a dependent."
You might want to bookmark these links and read the IRS guidance.
Interactive wizards portal for determining dependency:
https://www.irs.gov/help/ita
And:
https://www.irs.gov/newsroom/economic-impact-payment-information-center-topic-a-eip-eligibility
https://www.irs.gov/coronavirus/second-eip-faqs#Eligibility
One for each EIP.
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Thank you, that definitely helps!