Recovery Rebate Credit 2021 incorrectly added for overage dependent

[Rocket92]

As I was entering my information for 2021, I was surprised when TurboTax indicated that I may have not received the full amount for the 3rd EIP payment.  I entered the correct amount ($2800) that we had received, but it indicated that we were eligible for an additional $1400.  After filing, we have now received a letter from the IRS indicating that we were not eligible for the $1400 due to our dependent being over the age qualification, and we now owe $1400 more to the IRS.  TurboTax had the birth date for this dependent, so why did the software indicate that we were eligible for this additional credit?  This was incorrect and should not have been included with our tax return.

[DoninGA]

There is no age requirement for a dependent to be eligible for the 3rd stimulus payment.

There is an age requirement for the Child Tax Credit.  The dependent must be under the age of 18 in tax year 2021.  If they are age 18 or older they are eligible for the Other Dependent credit of $500

IRS website for third stimulus payment FAQ's - https://www.irs.gov/newsroom/questions-and-answers-about-the-third-round-economic-impact-payment-top...

You were not eligible for a payment if any of the following apply:

• You could be claimed as a dependent on another taxpayer’s 2020 tax return
• You were a nonresident alien.
• You did not have a valid SSN issued to you by the due date of your tax return (including an extension to October 15 if you requested it).

[Rocket92]

Wrong.  If you read the section titled: "Who’s considered a qualifying dependent for the third-round Economic Impact Payment? (updated March ..." in the link that you provided, you will see this:

• Child's age: The child was:
  • under age 19 at the end of the tax year,
  • under age 24 at the end of the tax year, a student, and younger than you, or
  • any age and permanently and totally disabled.

[DoninGA · Accepted solution]

The website states -

The third payment included up to an additional $1,400 for each dependent you claimed on your 2020 tax return (or your 2019 return if a 2020 return had not been filed or processed) with a valid social security number (SSN) or Adoption Taxpayer Identification Number issued by the IRS. A valid SSN for the third Economic Impact Payment is one that is issued by the Social Security Administration on or before the due date of your tax return (including an extension to October 15 if you request it).  An individual was your dependent if he or she was your qualifying child or a qualifying relative.

The website goes on to describe who is a qualifying dependent.  Either a Qualifying Child or a Qualifying Relative.  Your dependent probably is eligible under the Qualifying Relative rules

What you posted is if the dependent was a Qualifying Child.  It goes on to describe who is a dependent under the Qualifying Relative rules:

A person was your qualifying relative if the following conditions were met:

• The person can't be your qualifying child or the qualifying child of any other taxpayer.
• The person either is related to you in one of several ways or lived with you all year as a member of your household (and your relationship must not violate local law).
• The person is a U.S. citizen, U.S. national, U.S. resident alien, or a resident of Canada or Mexico.
• The person's gross income for the year must be less than $4,200 for 2019 tax returns or $4,300 for 2020 tax returns. (Exceptions exist if the person is disabled.)
• You must provide more than half of the person's total support for the year. (Exceptions exist for multiple support agreements, children of divorced or separated parents, and parents who live apart.)
• The person doesn’t file a joint return for the year (or files it only to claim a refund of withheld income tax or estimated tax paid).

[Rocket92]

I appreciate you taking the time to point that out!

I didn't even consider the "relative" portion of that section and only considered the "child" section, since they are our child.  I will contact the IRS, for a review of this issue.

Thank you!