Stimulus credit -- newly independent taxpayers

Forum|Forum|5 years ago
February 13, 2021
10 replies
23 views

I was doing the return of a client who will be filing independently for the first time this year. She did not receive stimulus payments because she was a dependent for 2019. When doing her tax return, the program is giving her the credit. This is awesome, if it is supposed to happen this way, but can anyone clarify. I don't want it to be a mistake, and have the IRS ask for it back later.

I do read updates regularly. I know the credit is for those who didn't get one or both stimulus payments, but should have. I just wasn't thinking she "should" have gotten a stimulus since she was a dependent in 2019.

Thank you!

ProSeries Professional

This topic has been closed for replies.

Best answer by IRonMaN

If she really no longer is a dependent, she does indeed get the credit. If however someone else could be claiming her as a dependent, she wouldn’t get the credit.

IRonMaNAnswer

Level 15

If she really no longer is a dependent, she does indeed get the credit. If however someone else could be claiming her as a dependent, she wouldn’t get the credit.

Slava Ukraini!

A

ajpAuthor

Level 6

In this case, she really is independent. She had finished college, moved out, paid her own rent, etc. I just didn't want her to get stuck repaying a credit that I applied incorrectly. Thank you!

qbteachmt

Level 15

"I just wasn't thinking she "should" have gotten a stimulus since she was a dependent in 2019."

"In this case, she really is independent."

You might want to Bookmark these and 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. 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.

Don't yell at us; we're volunteers

dd4vols

Intuit Community Champion

The 'stimulus payments' are 2020 Payments (even the one received in 2021, because it was authorized in late Dec 2020). They just used 2019 numbers because most of the 2020 returns were not received/accepted/approved when they started the stimulus process.

The stimulus payments had NOTHING to do with 2019 filing status...they just had to have somewhere to start getting info. Likewise, the recovery rebate should have NOTHING to do with 2019 filing status.

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