Yes you should file this year, because of the economic stimulus and enhanced child tax credit.
The American Rescue Plan Act includes an enhanced child tax credit of $3000, or $3600 for children under age 6 that is fully refundable even if you do not have income earned from working. This credit will be paid (supposedly) starting on July 1 by the IRS directly to taxpayers in monthly installments. (I say “supposedly“ because the law directs the IRS to make monthly advanced payments but the IRS may or may not actually be able to do that.)
If you want those monthly payment starting on July 1, 2021, you will need to file your tax return now claiming the dependent, so you are in the IRS system as qualifying for the enhanced credit. If you don’t file a tax return and the IRS does not know you have a qualifying dependent, you would be able to claim the credit on your 2021 tax return.
Also for 2020 tax returns, if you did not receive the $500 round one stimulus payment and the $500 round two stimulus payment for your dependent, the only way to get those payments is to file a 2020 tax return. Additionally, filing a 2020 tax return claiming the dependent will get you on the IRS notice to pay you the round three stimulus payment, which is $1400 per individual and $1400 per dependent.
