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Photium
Level 2

Will I receive the previous stimulus payments now that I am independent?

I was an adult dependent for 2019 resulting in my dad not receiving the dependent stimulus money for me. However, I was independent in 2020. Although I don't have to file taxes since I don't earn much(college student) I still plan on doing so. In 2020, my income was less than $1,200. If I include the money my dad gave me which is $1,500, my income would still be only about $2,600 if it is to be considered a part of my income. Even if I were to count $2,600 as my income for 2020, it would still be less than my income for 2019. Knowing this information, will I be able to receive the previous stimulus payments now that I am independent? The only reason I did not receive those 2 stimulus payments in 2020 was because I was a dependent in 2019. However, I was independent in 2020 which was when they were given out. Will I be able to receive the $1,800 from those two stimulus payments? I really need the money(college student here). Please let me know if you have any more questions.

3 Best answer

Accepted Solutions
Bsch4477
Level 15

Will I receive the previous stimulus payments now that I am independent?

Scholarships and grants do not count as support. This might seem like nit-picking but it is crucial in determining whether you can be claimed as a dependent. If you could—even if you were not claimed—as a dependent you must on your 2020 return state that someone can claim you and you would not get the stimulus. If, based on the worksheet below, you did provide more than half of your own support then you will get the 2 stimulus payments based on your 2020 return. 2019 is not relevant. 

https://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf

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Plato
Level 2

Will I receive the previous stimulus payments now that I am independent?

@Photium my disclaimer: what I posted here should not be interpreted as tax advice.  You should check with a tax professional for advice.  I am here just to explain my thinking and welcome others to correct me if I am wrong.

 

According to IRS publication 501, "your child is considered to have lived with you during the periods of time when one of you, or both, are temporarily absent due to special circumstances, such as: illness, education, business,...".   Those are exceptions for temporary absences.  So even if you were absent from home for 12 months due to Covid, those absence is considered due to education or illness, then you are still considered living with your parents for those 12 months.  That's my interpretation.

 

In the same IRS publication 501, it says "A scholarship received by a child who is a student isn't taken into account in determining whether the child provided more than half of his or her own support".   

 

According to IRS Publication 970 , Pell Grants and Other Title IV Need-Based Education Grants are treated as scholarships for purposes of determining their tax treatment.  You may have received a Form 1098-T, which shows the amount of scholarships or grants.  Your total annual needed support is well over $20K including tuition, and apparently you did not provide over half of your support from your own resources, then you are a qualifying child per dependence test.  And your parents can claim you as their dependent.  Because your parents can claim you as a dependent, they may be able to get Credit for Other Dependent (ODC) of $500 depending on their income.  If they can claim ODC, they can give the $500 to you when they get it from IRS.  

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Plato
Level 2

Will I receive the previous stimulus payments now that I am independent?

Disclaimer: I am not providing any tax advice.  I think you may want to check with a tax professional for tax advice.

 

To determine if you are a Qualifying Child, you need to meet both "Residence Test" and "Support Test" (in addition to other tests).  If IRS determines you are indeed a Qualifying Child, then you can be claimed as a Dependent.  According to IRS Guideline on Residence Test in Publication 501 , "your child is considered to have lived with you during periods of time when one of you, or both, are temporarily absent due to special circumstances, such as: illness, education,..."  

 

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15 Replies
Bsch4477
Level 15

Will I receive the previous stimulus payments now that I am independent?

In 2020 were you a full time student under age 24 who did not provide more  than half of your own support?  Clearly you did not support yourself on so little income. 

Photium
Level 2

Will I receive the previous stimulus payments now that I am independent?

Yes, I was a full time student. And I did provide for more than half of my own support. It came through my work savings from 2019, scholarships/grants, and work. 

Bsch4477
Level 15

Will I receive the previous stimulus payments now that I am independent?

Scholarships and grants do not count as support. This might seem like nit-picking but it is crucial in determining whether you can be claimed as a dependent. If you could—even if you were not claimed—as a dependent you must on your 2020 return state that someone can claim you and you would not get the stimulus. If, based on the worksheet below, you did provide more than half of your own support then you will get the 2 stimulus payments based on your 2020 return. 2019 is not relevant. 

https://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf

Plato
Level 2

Will I receive the previous stimulus payments now that I am independent?

Bsch4477: very interesting.  So, a college student cannot claim Recovery Rebate Credit (RRC), if the student's parents can claim the student as a dependent on their 2020 tax returns.  Whether or not the parents actually claim the student as a dependent does not matter.  So long as the parents provided more than half of the student's support during the tax year, then the student cannot claim RRC.

 

Claiming AOTC credit is very different from claiming RRC.  If the parents make too much money that make them ineligible for AOTC credit, then the student can actually claim AOTC credit on the student's own tax return, if the parents choose not to claim the student as their dependent.      

Photium
Level 2

Will I receive the previous stimulus payments now that I am independent?

What if I did not support myself in 2020 but no single person/agency would be able to claim me as a dependent? Like my funds were comprised of multiple agencies(federal/state gov - grants) and no single one paid for over half of my total expenses.

Bsch4477
Level 15

Will I receive the previous stimulus payments now that I am independent?

The key is whether YOU provided more than half of your support. As mentioned, scholarships do not count. 

Bsch4477
Level 15

Will I receive the previous stimulus payments now that I am independent?

You are correct with one clarification. The issue is not that the parents provided half of the support. It is that the student did not provide half of his own support. 

On the education credit issue you are also correct but know that for the AOTC the student would not get the refundable part of that credit in the scenario you described. See Pub 760 for details. 

Plato
Level 2

Will I receive the previous stimulus payments now that I am independent?

@Bsch4477 : you are correct in both issues.  The student needs to demonstrate that he provided more than half of his support in 2020, then his parents cannot claim him as a dependent on their tax returns, and then the student will be able to claim Recovery Rebate Credit on his own.   On AOTC credit, you are correct again in that the IRS prevents child from claiming refundable part of the credit unless the child earned through work more than more of his support, a difficult hurdle.  

 

@Photium : You indicated that you earned a little over one thousand dollars in 2020.  Where did the rest of the money come from?  Let's say you spent $40,000 in 2020 ($10,000 tuition after scholarship, $20,000 for room and board while in school, $5,000 for the summer food and lodging, $5,000 for other personal items like cell phone, travel, etc).  Out of $40,000 total expenditure, $20,000 must come from your own source such as your own savings account, money earned from work, money borrowed under your own name.  You cannot count scholarship and money from the state as your own source.  If you cannot prove that you provided half of your own support, then most likely you are a qualifying child of your parents, and then they can claim you as their dependent.  

Photium
Level 2

Will I receive the previous stimulus payments now that I am independent?

@Plato  Ok here is my info to make it easier.

Tuition: $14,928(all covered by fafsa grants)

Rent: $6,783

Renter's Insurance: $187.44

Electricity: $297.57

Books/Supplies: $280.31

Other Expenses: $2,288

 

Opening Bank Balance: $3,986.69(Work savings)

Work: $1,132.16

Parent: $1,500

Bank Interest: $3.18

Scholarship: $2,000

Grants(Federal and State): $16,313

 

I noticed you said "10,000 tuition after scholarship". Do we not include tuition that scholarship/grants paid in our expenses? If so, I would then have provided for more than half of my expenses through my work savings and work?

 

For qualifying child requirements, confirm this for me: If I do not provide for over half of my support then I can be claimed as a dependent if all of the certain conditions are met. I meet all of them except perhaps for one of them: The child must have lived with you for more than half of the tax year. If your child was temporarily away from home for school attendance, we count that as time lived with you. I live in an off-campus apartment right next to my University. I plan on living here until I graduate then I plan on moving into another apartment close to the full-time job I would have acquired. My parents live several hours away. Under this it seems like my parent would not be able to claim me as a dependent?

 

I know I'm being particular about this but that's because 1) I don't want to mess up my taxes and get in trouble and 2) I need that $1,800 stimulus check. My parent didn't get it last year since I was an adult dependent in 2019 and I obviously didn't get it either. I was also negatively hit financially because of COVID-19 and hardly received anything because of it so it doesn't make sense(a polite way of putting it) that neither me nor my parent got it or will get it if I am considered to have been able to be claimed as a dependent in 2020. 

Plato
Level 2

Will I receive the previous stimulus payments now that I am independent?

@Photium First, you parent should have received $2,400 stimulus check in 2020, unless your parents' 2019 AGI exceeded $150,000 when filed as married joint return.  You could not qualify for the $500 because you had to be under 17 at the end of the taxable year.  If they did not receive the stimulus check for any reason, then they can claim the Recovery Rebate Credit on their 2020 tax return. 

 

Second, your opening bank balance was $3,986.69 plus $1,132.16 from work plus $3.18 from bank interest.  Even if you spent your entire bank savings in 2020, then your source of support was only $5,122.03.  I presume you did not borrower any money under your own name in 2020, then you did not provide half of your support.  In this case, IRS states that your parent can claim you as a dependent, because you are a qualifying child.   Remember, if you lived with your parents during the winter break and in the summer, your parents provided support during those periods through shelter and food, and IRS would count monetary value of the shelter and food as parental support.

 

Third, even if you spent 9 months in an off campus apartment, those 9 months count as time of living with you parents, because those temporary absence from home was for school reason, and your home is still your parents' home for now.  After you graduate from college and provide more than half of your own support, then you will have a new home and you are no long a dependent.  In the mean time, your parents can claim you as a dependent.  Even if your parents refuse to claim you as a dependent, you do not get any tax benefits.  

 

 

 

Photium
Level 2

Will I receive the previous stimulus payments now that I am independent?

@Plato Yes, I did not borrow any money under my name. 

 

I actually spent the full 12 months at my off campus apartment because of covid and my parents didn't visit because of covid. The $1,500 was the only support I got from them because I didn't need anymore.

 

So, my home is my parents' home until I provide more than half of my own support even if I don't consider it my home?

Plato
Level 2

Will I receive the previous stimulus payments now that I am independent?

@Photium my disclaimer: what I posted here should not be interpreted as tax advice.  You should check with a tax professional for advice.  I am here just to explain my thinking and welcome others to correct me if I am wrong.

 

According to IRS publication 501, "your child is considered to have lived with you during the periods of time when one of you, or both, are temporarily absent due to special circumstances, such as: illness, education, business,...".   Those are exceptions for temporary absences.  So even if you were absent from home for 12 months due to Covid, those absence is considered due to education or illness, then you are still considered living with your parents for those 12 months.  That's my interpretation.

 

In the same IRS publication 501, it says "A scholarship received by a child who is a student isn't taken into account in determining whether the child provided more than half of his or her own support".   

 

According to IRS Publication 970 , Pell Grants and Other Title IV Need-Based Education Grants are treated as scholarships for purposes of determining their tax treatment.  You may have received a Form 1098-T, which shows the amount of scholarships or grants.  Your total annual needed support is well over $20K including tuition, and apparently you did not provide over half of your support from your own resources, then you are a qualifying child per dependence test.  And your parents can claim you as their dependent.  Because your parents can claim you as a dependent, they may be able to get Credit for Other Dependent (ODC) of $500 depending on their income.  If they can claim ODC, they can give the $500 to you when they get it from IRS.  

Plato
Level 2

Will I receive the previous stimulus payments now that I am independent?

Disclaimer: I am not providing any tax advice.  I think you may want to check with a tax professional for tax advice.

 

To determine if you are a Qualifying Child, you need to meet both "Residence Test" and "Support Test" (in addition to other tests).  If IRS determines you are indeed a Qualifying Child, then you can be claimed as a Dependent.  According to IRS Guideline on Residence Test in Publication 501 , "your child is considered to have lived with you during periods of time when one of you, or both, are temporarily absent due to special circumstances, such as: illness, education,..."  

 

DMarkM1
Expert Alumni

Will I receive the previous stimulus payments now that I am independent?

@Photium The question still is and you need to do the math, did you provide over 1/2 of your support with less than 1/2 total coming from all the other sources (scholarships and parents). 

 

Here is a link to a worksheet to help.  See worksheet 2.  

 

As @Plato mentions you are considered to have lived with your parents even when away at college especially if living in temporary quarters. 

 

If you provided more than 1/2 of your support, then you may not be a dependent.  You have to provide the proof, if the IRS asks at some point in the future. So be sure to keep the completed worksheet.     

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