Studentst and stimulus number 3

[Liesal]

Student graduated from college May 2021. HAd full time job beginning may , earned 24k through year end.. 

His work pays his health premiums. so hes not on mom and dads. he does live at home.

 so question is pertaining to stimulus 3?.  his parents will not claim in 2021 even tho by virtue of his being a student for 5 months they could.   Their income is too high for any education benefits and no other child credit.  so student now independent will claim himself.  

SO in software . if i check yes someone could claim him then no rrc 1400( by virtue of them support for five months). I f i check no then he gets. as well he is now eligible for the aotc for his final semester.   This sounds too good to be true. 2500 plus 1400 by checking the right box.  AS aside i know of several friends whose students were declared " independent in ' in 2020 to get stimulus 1 and 2 not saying its right but it was done(not by me). 

so is this easy money or am i missing something?  does the " could" claim him even tho he has earned enough money by 2021 end to claim himself cancel all my checkboxes.

[qbteachmt]

Bookmark this:

https://www.irs.gov/help/ita

And use the one for Dependent. Because the EIP eligibility includes "could be claimed" and that makes the difference.

[The-Tax-Lady]

The EIP is a money "free for all". It's all based on the 2021 tax filing and lots of taxpayers are eligible for the 3rd one, even if it was paid to a parent in 2020.

Presuming the taxpayer is 24 or older, they are entitled to the AOTC education credit, if it has been claimed for less than 4 yrs by the parents.

[Liesal]

So your response implies because parent could claim him then no rrc for 2021.

I went to the ita and typed in recovery rebate credit for college students and got no hits.

[Liesal]

tp is under 24, imagine that someone who completes 4 years of school in 4 years , Anyhow I checked the box yes he provided more than half his support as . aotc computes including the refundable portion

tuition 24, scholarships 16k

 wages earned 24

[The-Tax-Lady]

You said the parents were not claiming him and my response was based on that.

I was not implying he was not eligible for the RRC.

I was stating that he was eligible, along with many other taxpayers, to claim the RRC on his 2021 return, regardless if anyone else received it in 2020 for him as a dependent.

[Liesal]

i am confused as your response and the other response seem to contradict.. I will keep researching. if paretns could claim but dont then is tp/student eligible for rrc.

[The-Tax-Lady]

Yes. If you have the box checked on the Fed Info worksheet that yes he could be claimed, change that to NO.

[Liesal]

I might  add parents did not get stim money as their income too high nor have they ever been able to claim aotc.

[qbteachmt]

"I went to the ita and typed in recovery rebate credit for college students and got no hits"

You are getting multiple people replying to your multiple issues. Being a college student isn't the issue; dependency is the issue.

"So your response implies because parent could claim him then no rrc for 2021"

That is how the rules read. It's in the provision. Did you look at the Eligibility? 1040 instructions? Your program?

"Can you be claimed as a dependent on another person's 2021 return? If filing a joint return, go to line 2.
No. Go to line 2.
Yes.STOP

You can't take the credit. Don’t complete the rest of this worksheet and don’t enter any amount on line 30.

"I was stating that he was eligible, along with many other taxpayers, to claim the RRC on his 2021 return, regardless if anyone else received it in 2020 for him as a dependent."

But not based on Status; you have to know that status.

Use the Wizard:

Whom May I Claim as a Dependent?

https://www.irs.gov/newsroom/questions-and-answers-about-the-third-economic-impact-payment

https://www.irs.gov/newsroom/questions-and-answers-about-the-third-economic-impact-payment-topic-b-e...

It's the very first question and answer:

"What can I do if someone else claimed me as a dependent in 2020 and I did not receive the third Econ...

If you were claimed as a dependent on someone else’s tax return for 2020, you were not eligible for the third Economic Impact Payment. If no one can claim you as a dependent for 2021 and you are otherwise eligible, you can claim the 2021 Recovery Rebate Credit, and must file a 2021 tax return to claim the credit."

And:

https://www.irs.gov/coronavirus/third-economic-impact-payment

"Generally, someone was eligible for the full amount of the third Economic Impact Payment if they:

• are a U.S. citizen or U.S. resident alien (and their spouse if filing a joint return), and
• are not a dependent of another taxpayer, and"

[qbteachmt]

"Yes. If you have the box checked on the Fed Info worksheet that yes he could be claimed, change that to NO."

Uh, only do what Applies. Could be claimed is not the same as being claimed.