Recovery Rebate Credit Worksheet

[rodrigo]

Client is filing taxes for the 1st time in many years. She is claiming her 4 children as dependents. They all received $3288 SSI benefits from the deceased father in 2020.

All the children received EIP1 of $1200 and EIP2 of $600 from their SSI benefits. She received none.

I may be overthinking this, but what is the correct way to complete the values on the recovery rebate credit worksheet EIP1/Line 16 and EIP2/Line 19?

1 of the children turned 18 years old in 2020 but he was still her dependent.

Thank you in advance for your time.

[qbteachmt · Accepted solution]

"All the children received EIP1 of $1200 and EIP2 of $600 from their SSI benefits. She received none."

That's odd, because Children don't get payments. Their Adults get payments. Some adults have dependent children that are eligible.

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 as individual filers. 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.

[rodrigo]

Thank you for the information. I will dig a little further.