Changing filing status for stimulus eligibility

[jstrunks325]

In 2019 we filed married filing jointly and received Stimulus 1 and 2 payments.  Due to our combined income from 2019 we did not qualify for the 3rd stimulus.  If we change our filing to married filing separately for tax year 2020 I believe my wife will qualify for the payment.  My plan would be to have her claim all of our dependents to maximize our stimulus.  **Is this something that is feasible?  Is it worth it?  We do have 5 dependents plus her with her income at 66,000.

[ErnieS0]

There is no prohibition against filing separately. if you do file separately, you can allocate your children in any manner that you wish.

The income limits are half for married filing separate for the third stimulus.

Generally, if you are a U.S. citizen or U.S. resident alien, you are eligible for the full amount of the third Economic Impact Payment if you (and your spouse if filing a joint return) are not a dependent of another taxpayer and have a valid Social Security number (see exception when married filing jointly) and your adjusted gross income (AGI) on their tax return does not exceed:

• $150,000 if married and filing a joint return or if filing as a qualifying widow or widower
• $112,500 if filing as head of household or
• $75,000 for eligible individuals using any other filing statuses, such as single filers and married people filing separate returns.

Payments will be phased out – or reduced -- above those AGI amounts. This means taxpayers will not receive a third payment if their AGI exceeds:

• $160,000 if married and filing a joint return or if filing as a qualifying widow or widower
• $120,000 if filing as head of household or
• $80,000 for eligible individuals using other filing statuses, such as single filers and married people filing separate returns.

More details about the third round of Economic Impact Payments

[jstrunks325]

I do have some concerns about the possibility of an audit maybe?  When we go through the software with married filing separately it shows that I was over payed on the 1st and 2nd Stimulus and that my wife was under paid on both and thus is gives her a higher refund to cover her payments.  Is this okay?  It would be nice to talk this through with someone...is this something I can sign up for?

[DawnC]

You can contact support and speak with a representative as long as you are not using TurboTax Free Edition (support is not included with that version).    You should not have an audit issue as long as you are reporting the payments that you already received.   

Is it better for a married couple to file jointly or separately?    Some things to consider when opting to change your filing status.