EIP Payments

[jogo39]

I am doing a tax return for a single mother who is claiming the exemption for her child in   2020.  Prior years the father claimed the child.  So in 2020 he received the stimulus payments for himself and the child.

When I am doing the mother's tax return now, and because the mother is claiming the child, the Recovery Rebate Credit is showing as $1,700 for EIP1 and $1200 for EIP2, however she only received $1,200 for EIP1 and $600 for EIP2.  thus giving her the difference in a refund. 

How do I tell the system that the EIP credits were already received for the child by the father?    

[TAXOH]

It is correct the way it is.

[Just-Lisa-Now- · Accepted solution]

Dont worry about 2019. 

Dont worry about what the other parent may have received as an advance. 

2020 is the eligible tax year, the person that claims the dependent in 2020 gets the RRC.

[qbteachmt]

"Prior years the father claimed the child."

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.

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.

[jogo39]

Hello Lisa,

I just want to be sure that the IRS is not going to come back after the mother saying she owes money back because they collected for the child twice.   Maybe I'm not understanding the stimulus payment but I do accept your answer.    Another person responded to be (I copied their response below).  It confused me because they really didn't help but I felt they were telling me I should not allow the mother to collect additional monies.  Your thoughts?

"Prior years the father claimed the child."

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.

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

[qbteachmt]

"Maybe I'm not understanding the stimulus payment but I do accept your answer."

It's become obvious no one understood how to execute this, because they were only able to use old tax returns. That's why people dead in 2019 got stimulus checks based on 2018 tax returns.

"Another person responded to be (I copied their response below). It confused me because they really didn't help but I felt they were telling me I should not allow the mother to collect additional monies."

That's not what I showed. You need to read those links, go to the source which is IRS, and learn the rules that apply to the scenario. That's how you learn it, and don't need to keep asking people on the internet. Or, at the least, you have the ability to check that they are giving you the right guidance, because you check for yourself, as part of this being your responsibility as the tax preparer.

Here's what happened:

 Anyone getting the money for 2020 did not get it based on their 2020 tax return status. You know this. The 2020 tax returns were not yet filed. There is no provision that makes anyone pay anything back. That father got the money as a projection and that projection is not the 2020 reality.

Right now, you are working on the 2020 reality.