Split Custody - Amended Tax Return

[userkatelandcampbell]

My husband and I legally get to claim my stepson every other year on our taxes. We claimed him for 2020, but had to submit an amended return, which still hasn't be processed (16 weeks will be August 16). We are worried we are going to miss out on the tax credit for 2020 because my husband's ex-wife will get to claim my stepson next year on her taxes. We also haven't received any stimulus checks for my stepson either. Any insight or advice?

[conniem123]

Great question about dependents on returns for alternating years!  You claimed your step son on your 2020 tax return, and would have received the 2020 Child Tax Credit , Form 1040 line 19 and any additional child tax credit on line 28. 

Advance Child Tax Credit payments are early payments from the IRS of 50 percent of the estimated amount of the Child Tax Credit that you may properly claim on your 2021 tax return during the 2022 tax filing season.  Since you will not have the Child Tax Credit for your step son on your 2021 tax return you would not want to receive the advance payments as you may have to pay the advance back to the IRS when you reconcile the advance payments received to your Child Tax Credit on your 2021 tax return.

Stimulus payments not received are reconciled on your tax return.  The first stimulus payment, issued Spring of 2020, and the second stimulus payment, issued Dec 2020 - Jan 2021, if NOT received  would have been reported as a Recovery Rebate Credit on your 2020 tax return, Form 1040 line 30. 

The third stimulus payment if NOT received will be reconciled on the 2021 tax return.

[userkatelandcampbell]

Thank you for your response and clarification. We will not be legally claiming my stepson for 2021 and because our amended return still hasn't been processed for 2020, we haven't received the stimulus for him yet - they went off our 2019 return when it was not our year to claim him. Will the IRS back pay us for this once it's eventually processed or will we miss out because we can't claim him next year for 2021?

[conniem123]

If you do not receive the third stimulus payment once the IRS processes your 2020 tax return, you would need to reconcile on your 2021 tax return, which I understand your stepson will not be on your 2021 tax return.  Currently that is the IRS process, but this could change as we continue in 2021.  

You can follow this IRS link for updates on the third stimulus payment.

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

The IRS will continue to process 2020 tax returns and issue additional payments in 2021 to individuals who have not already received a third payment or who are eligible to receive an additional amount if their initial payment was not based on their 2020 tax return.

If you are in this situation and eligible for the third Economic Impact Payment or an additional amount based on your 2020 federal tax return:

• Your payments will be issued after your 2020 tax return is processed. Check your payment status in Get My Payment.
• You will receive a Notice 1444-C, Your third Economic Impact Payment, after the payment is issued. Keep this notice with your 2021 tax records.

If you do not receive a payment this year, you may be eligible to claim the 2021 Recovery Rebate Credit when you file your 2021 tax return in 2022.