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lori-drozd
Level 1

Stimulus checks: new baby 2020 not calculating

I am having an issue and wanted to see if others share it. My spouse and I had a baby in 2020 so we did not receive the "child" portion of the stimulus checks for COVID (CARES Act, etc.). In turbo tax, it correctly identified the child as a "dependent" and we got the standard $2000 credit for the child.

 

But, when turbotax at the end of the filing does the "lets make sure you got the right stimulus amount" it mentions that the number could be wrong if you added a dependent in 2020 (like a baby). When we put our numbers in (obviously without any dependent monies) and turbotax says this is all correct and continues on! Is anyone else experiencing this? We, very obviously have a new dependent that should have drastically changed our stimulus amount. Is this a turbotax fail? Did I input my dependent incorrectly (as mentioned I am still getting the normal tax credit)?

1 Best answer

Accepted Solutions
APLA
Level 2

Stimulus checks: new baby 2020 not calculating

"The Stimulus checks are really based on your 2020 tax return. Any amount you already got will be reconciled on your 2020 return line 30."

 

^The missing piece. Per IRS the Recovery Rebate Credit process is based off your 2020 return and the latest limits (ie. 150k for joint before the 5% reduction kicks in). 

 

Within the IRS instructions on how to fillout the 1040 is a handy section that walks you through how to calculate if you qualify for a Recovery Rebate Credit. Using that matched exactly to what TurboTax came back with.

 

Iink to instructions doc: https://www.irs.gov/instructions/i1040gi

    - Its a huge doc, do a search on 'Recovery Rebate Credit Worksheet' to help find the calc instructions

View solution in original post

20 Replies
SweetieJean
Level 15

Stimulus checks: new baby 2020 not calculating

Be sure to indicate that the child lived with you all year.

lori-drozd
Level 1

Stimulus checks: new baby 2020 not calculating

I already have and still doesn't recalculate stimulus

DoninGA
Level 15

Stimulus checks: new baby 2020 not calculating


@lori-drozd wrote:

I already have and still doesn't recalculate stimulus


Verify all your answer concerning the child as your dependent.

Verify that you chose My Child, that the date of birth is accurate MM/DD/YYYY, that you indicated the child lived with you for the Whole Year, that the child did NOT provide over one-half of their own support, that there was NOT any other person in the household supporting the child, that you (and spouse if applicable) are the legal parents,  that the child has a valid Social Security number and you did NOT check the box not valid for employment.

If all these questions were answered correctly and the stimulus payment for the child is not being added as a credit on your tax return, delete the child as a dependent and re-enter the child.

lori-drozd
Level 1

Stimulus checks: new baby 2020 not calculating

if i change to no, i lose my normal child $2000 deduction, so yes is correct (turbotax even says to claim as such)

VolvoGirl
Level 15

Stimulus checks: new baby 2020 not calculating

What question did you change to no?  Delete the child and re add your baby.

lori-drozd
Level 1

Stimulus checks: new baby 2020 not calculating

Something else must be going on (which I am surprised because my taxes are quite simple and even use the standard deduction). After deleting my child I find out I am not getting anywhere near the standard $2000 credit (we are getting less than 1k). This is strange because a) our joint income is far below the phase out portion (we would even be under for a single file) and b) our tax liability is very high (far exceeding the credit by multiples). Even after deleting and re-adding the child we still:

 

A) do not get our full standard $2000 tax credit (is there any other reason why we would not get this?)

B) we still do not get the stimulus portions and TurboTax checks that everything "looks great!"

 

I have answered, checked and rechecked all my questions and they are as you have suggested. What is going on????

APLA
Level 2

Stimulus checks: new baby 2020 not calculating

I am having the same exact issue. We had a baby in 2020 and answered all the questions as suggested above. I even removed and re-added. Yet when it does the stimulus check at the end it says we got the correct amount but we did not since we had not received the dependent amounts for either stimulus.

JamesG1
Expert Alumni

Stimulus checks: new baby 2020 not calculating

Make sure that the newborn child is correctly reported as a dependent on your tax return.  IRS FAQ states:

 

A qualifying child must have either: 

  • An SSN that’s valid for employment and assigned to them before the due date of your 2019 return (including the filing deadline postponement to July 15 and an extension to October 15 if you requested it); or
  • An ATIN.

An ITIN won’t be accepted for a qualifying child.

 

Note: When the qualifying child is claimed by spouses filing a joint return, at least one spouse must have an SSN that’s valid for employment for a qualifying child to be considered. If the return isn’t filed by married spouses filing a joint return, the taxpayer filing the return must have an SSN that’s valid for employment for a qualifying child to be considered.

 

The TurboTax software adds together the entries that you made for receiving stimulus check 1 and stimulus check 2.

 

Then the software computes the amount of your stimulus check amounts based upon the information that has been entered into the tax software. 

 

If you are due an additional amount, it will be issued as a Rebate Recovery Credit (RRC) on line 30 of the 2020 1040 tax return.

 

If you believe that you are due a Rebate Recovery Credit (RRC) on line 30 of the 2020 1040 tax return, then you should: 

  • Check the amounts entered for stimulus check 1 and stimulus check 2, and
  • Make sure that you have correctly entered your dependent information.

If there is a difference, it is in one or both of these situations. 

 

In TurboTax Online, you are prompted to input stimulus check 1 and stimulus check 2 information under Review down the left hand side of the screen.

 

You can also access your stimulus check choices by following these steps: 

  • Down the left side of the screen, click on Federal.
  • Across the top of the screen, click on Other Tax Situations.
  • At the screen Let’s keep going to wrap up.  Click on Let’s keep going.
  • At the screen Let’s make sure you got the right stimulus amount, click Continue.
  • At the screen Did you get a stimulus payment? you can update your stimulus check entries. 

  See also this TurboTax Help.

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lori-drozd
Level 1

Stimulus checks: new baby 2020 not calculating

All of these things have been done. New child has a valid full SSN (no restrictions, and the "not valid for employment box is NOT checked).  Stimulus dollars were found and recorded into the software from our bank account with a direct deposit from the IRS, I have double checked these numbers and they are 100% accurate. I have also back checked these numbers from what we should get based upon our income and the calculation, again, is correct. These numbers were based on 2019 return when we DID NOT have any dependents (children).

 

Since the above numbers do not reflect any child dependents in our stimulus payments, we are due the child-dependent portion. TurboTax does not find this and says the numbers are accurate and we are not due any additional stimulus monies.

 

As some background, our child is added, officially in TurboTax as a depended (completely accepted) and under the federal review we are listed and shown to receive the standard $2000 tax credit for a dependent child.  Although TurboTax has identified the dependent for all other tax situations, it still fails to recognize additional stimulus payments for RRC on line 30, which should be both stimulus 1 & 2 to include a child dependent portion.

DoninGA
Level 15

Stimulus checks: new baby 2020 not calculating


@lori-drozd wrote:

All of these things have been done. New child has a valid full SSN (no restrictions, and the "not valid for employment box is NOT checked).  Stimulus dollars were found and recorded into the software from our bank account with a direct deposit from the IRS, I have double checked these numbers and they are 100% accurate. I have also back checked these numbers from what we should get based upon our income and the calculation, again, is correct. These numbers were based on 2019 return when we DID NOT have any dependents (children).

 

Since the above numbers do not reflect any child dependents in our stimulus payments, we are due the child-dependent portion. TurboTax does not find this and says the numbers are accurate and we are not due any additional stimulus monies.

 

As some background, our child is added, officially in TurboTax as a depended (completely accepted) and under the federal review we are listed and shown to receive the standard $2000 tax credit for a dependent child.  Although TurboTax has identified the dependent for all other tax situations, it still fails to recognize additional stimulus payments for RRC on line 30, which should be both stimulus 1 & 2 to include a child dependent portion.


Suggest 2 more procedures that may help correct this problem.

Save the tax return and then close the TurboTax program.  Re-start your computer.  After the computer re-starts open the TurboTax program and go back through the sections of the return until you get to Federal Review, verify your entries and see if the credit is now being added.

If not, then save the return and close TurboTax.  Uninstall TurobTax and re-install.  Go back through the TurobTax program and see if this corrects the problem.

APLA
Level 2

Stimulus checks: new baby 2020 not calculating

Completely agree with @lori-drozd on what she is experiencing. I have confirmed all of the same things.

 

The first stimulus check was based on 2018 and second based on 2019 returns. Not sure if this has anything to do with the issue but I did not use TurboTax for my 2018 or 2019 returns. How would TurboTax know if my stimulus is accurate without those returns.

VolvoGirl
Level 15

Stimulus checks: new baby 2020 not calculating

It doesn't matter what your 2018 or 2019 returns were.   The Stimulus checks are really based on your 2020 tax return. Any amount you already got will be reconciled on your 2020 return line 30. If you didn't get a Stimulus Check (and qualify) or you qualify for more it will be added to your 2020 return. But the good news is if they paid you too much they won't take it back.


When you go through the federal review tab it will ask how much you got if any. Or to enter your stimulus payment in TurboTax, type "stimulus" (without the quotes) in the Search box, then click the link that says "Jump to stimulus." If you didn't get one or both enter a 0 and not leave it blank or it won't calculate it.


After you have entered your tax information and are ready for the Federal Review, it will be the first question.


If you are trying to trigger it, you can go to Other Situations, answer any questions and click Done. The next automatic selection is Federal Review and it will ask about payments received.

 

APLA
Level 2

Stimulus checks: new baby 2020 not calculating

"The Stimulus checks are really based on your 2020 tax return. Any amount you already got will be reconciled on your 2020 return line 30."

 

^The missing piece. Per IRS the Recovery Rebate Credit process is based off your 2020 return and the latest limits (ie. 150k for joint before the 5% reduction kicks in). 

 

Within the IRS instructions on how to fillout the 1040 is a handy section that walks you through how to calculate if you qualify for a Recovery Rebate Credit. Using that matched exactly to what TurboTax came back with.

 

Iink to instructions doc: https://www.irs.gov/instructions/i1040gi

    - Its a huge doc, do a search on 'Recovery Rebate Credit Worksheet' to help find the calc instructions

ksmith8807
New Member

Stimulus checks: new baby 2020 not calculating

I am having the exact same issue - not receiving the stimulus for my baby we had in 2020 and the child /dependent tax credit seems to be incorrect too despite all my information being correct. 

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