Recovery Rebate Credit

[Penni]

Have a client that is allowed to take child every other year on tax return.  2020 is the year for him to take child as dependent.  The Recovery Rebate Credit is calculating a credit for the dependent of $1100.00 and adding it to their refund.  The mother took the child last year as a dependent and received the rebate for the child based on 2019 tax return.  Have researched this situation but can not find any clarification on how to handle this.  Any thoughts?  I am thinking not take the additional credit.

[Terry53029 · Accepted solution]

Your client is eligible to get the payment. Here is info from IRS:

This is link: https://www.irs.gov/newsroom/why-the-economic-impact-payment-amount-could-be-different-than-anticipa...

Parents who are not married to each other and do not file a joint return cannot both claim their qualifying child as a dependent. The parent who claimed their child on their 2019 return may have received an additional Economic Impact Payment for their qualifying child. When the parent who did not receive an additional payment files their 2020 tax return next year, they may be able to claim up to an additional $500 per-child amount on that return if they qualify to claim the child as their qualifying child for 2020.

[Just-Lisa-Now-]

Don't worry about 2019 or the advances that were sent to the other parent using 2019 information.

Whomever claims the child in 2020 is entitled to the credit. 

If YOU are claiming the child in 2020 and YOU didnt get any advance for them, then you get it on the return.

[dascpa]

Interesting, so for parents that alternate years who claims the Child (Form 8332) there might be a doubling of the stimulus for that child.

[Just-Lisa-Now-]

Yep!

[Penni]

Thank you for the link.  I guess I didn't read down far enough.  Doesn't seem right but then again they sent money to deceased persons.

[Tiffanynicole207]

What about this same situation except it’s not the fathers year to claim the child AND he had a new baby in 2020? Recovery rebate credit shows he’s not owed anything for new baby even though he is because his dependents went from 2-2 not 2-3. If both parents get to get stimulus money for one kid then we should be able to get it for our new baby too.

[qbteachmt]

"then we should be able to get it for our new baby too."

@Tiffanynicole207 

You seem to be lost on the internet.

You’ve come to a Peer User community for Intuit Tax Preparation products supporting tax preparation professionals using ProSeries, Proconnect and Lacerte , and you may be looking for support as an individual taxpayer. Please visit the TurboTax Help site for support.

Thanks.

[JACKDOG]

Something does not seem right with this !!

If the public finds out if you just switch dependents you gonna get more money..LOL

Wow !!

[Florez83]

Have kind of the same problem. It’s my year to claim my 2 children. Their mother is also eligible to receive the Stimulis rebate because we have 50/50 custody. I can’t claim them if she files for the rebate, even though it clearly says we both are entitled to receive a Stimulis. Once she files for rebate with their social security numbers then my taxes will be rejected. So now how do I get my taxes?

[qbteachmt]

No one is "also eligible" based on the same people and Custody has nothing to do with this. A professional tax preparer is supposed to know the qualification and eligibility rules.

@Florez83 

Are you doing a Clients' tax return using ProSeries Software? Otherwise...

You seem to be lost on the internet.

You’ve come to a Peer User community for Intuit Tax Preparation products supporting tax preparation professionals using ProSeries, Proconnect and Lacerte , and you may be looking for support as an individual taxpayer. Please visit the TurboTax Help site for support.

Thanks.

[cjdykeman]

If the same follows through for 2021 and there are no dependents on the 2021 return, but stimulus checks were sent to the parent claiming the children for 2020 that would generate an overpayment and have to be repaid.  No?

[qbteachmt]

"If the same follows through for 2021"

The same, which part?

These payouts are Advances against the actual tax form filing. So far, no one has had to repay an Advance when it turns out the reconciliation on the tax form shows they were not eligible.