@Wende913 wrote:
My daughter has medical issues and cannot work. That is why she moved in with me with my grandson.
Legal, moral, and family practical are often very different.
Legally, if you provided more than half your daughter's support and she doesn't work, you can claim her as a dependent. Legally, if your grandchild lived in your home more than half the year and you have more taxable income than your daughter, you can claim your grandchild as a dependent. The tax benefits of claiming a dependent are much higher in 2020 and 2021 than in a "normal" year, but those benefits always go to the taxpayer, and not the dependent, because the tax code recognizes that the taxpayer is supporting the dependent. Even if your daughter tried to file her own return, she would be legally obligated to answer "yes, someone else can claim me as a dependent" which disqualifies her from any stimulus payments or rebates in her own name for herself or her child.
As a practical matter, you likely received $2800 extra in your refund due to the fact that your family moved in with you, that you would not have received if they lived some place else. (Although it might be less than $2800 if you are high income.) You also likely qualified to file head of household if you are single, which may have saved you some extra money.
Legally, is your daughter entitled to the rebate? No. The rebate goes to the taxpayer who claims the dependent.
Morally, is your daughter entitled to a share of the rebate? That's a matter of opinion. My own opinion is probably not, since you probably spend much more than $2800 on food, clothing, and other expenses for your extended family.
Should you give her a share anyway, for family peace? That's complicated and no one can answer that for you, except maybe a family therapist. If my daughter came to live we me due to financial problems, and then demanded I pay her for the privilege, I would be heartbroken that she felt so entitled as to ask in the first place. But that's me. You have to decide what works for you. Good luck.
