2021- $1400 Economic Stimulus Payment

[jskouberdis]

I have a situation where a lady who did not file her return because she had no income except social security she received $1400 stimulus payment in 2021.  In the past her daughter did not claim her as a dependent but in 2021 wants to claim her because she provides more than half of her support.  When filling out the stimulus worksheet if I take her as a dependent on daughter's return this year it will populate that she is entitled to $2800 of stimulus payments.  Should I fill in the amount received as $2800 because mother and daughter both received the proper stimulus payments or should I only put in the $1400 that the daughter received because she is the taxpayer therefore the daughter will get another $1400 for the mother on 2021 return because she is claiming mother on 2021 taxes.  Has anybody else seen this.  I know that as far as college students I had a few that claimed themselves on their returns and they received a stimulus payment on 2020 return and the parents received stimulus payment for students also before they filed their returns.  Hope to hear from somebody out there in the community.

[taxiowa]

I don't know what the IRS will rule on this matter.  Initially Congress intended that the $1,400 followed the taxpayer to whichever return they ended up on.  But the instructions for the return show just the amount the taxpayer received.

However this is different than students who miraculously all of sudden provided their own support in 2020.  College students did not qualify for first two stimulus, so they were not really double dipping as in in this case.

[jskouberdis]

Yes you are right they did not qualify if they were over 17.  But the thing in my situation that befuddles me is that if you are overpaid I have found from research that the IRS will not pursue repayment.  I can see this as double dipping as you say.

[BobKamman]

• Qualifying dependents expanded. Unlike the first two payments, the third payment was not restricted to children under 17. Eligible individuals received a payment based on all of their qualifying dependents claimed on their return, including older relatives like college students, adults with disabilities, parents and grandparents.

https://www.irs.gov/coronavirus/third-economic-impact-payment#:~:text=%241%2C400%20for%20an%20eligib...

[PATAX · Accepted solution]

I would wait a little bit to see if there is further IRS guidance on this and/or ProSeries update... just my opinion

[jskouberdis]

So do you think that the elderly mother would be eligible for stimulus payment on her own and also her daughter would be eligible for mother's stimulus payment on daughter's return and there would be $2800 assigned to the mother?

[BobKamman]

For those familiar with the musical version of the Shavian classic Pygmalion, this may serve as an example of the middle-class morality disliked by Alfred Doolittle of the "undeserving poor." If the law allows it, why stew about whether it is the right thing to do? Why not instead ask if HoH filing status should also be claimed?

From the mother’s perspective,

A man was made to help support his children
Which is the right and proper thing to do
A man was made to help support his children
But, with a little bit of luck, with a little bit of luck
They'll go out and start supporting you

[qbteachmt]

"on her own and also her daughter"

That question regarding if you could be claimed as a dependent by another person (even if they are not claiming you this year) always confuses people. Am I a dependent or not for tax purposes, can be resolved. Sheesh.