I have a dependent who thinks that if she files her own taxes for 2020 she will then the $1200 stimulus check that was issued in 2020. Is this correct?

[Critter-3]

If she can be claimed as a dependent then she must indicate she can be claimed as a dependent on her 2020 return EVEN if she will not be claimed as a dependent.   If she doesn't then she is committing income tax fraud to get the stimulus check. 

So have her look at the rules ... is she a dependent or not ?  

There are two rules to claim someone as a dependent on a tax return, either the Qualifying Child rules or the Qualifying Relative rules. 

 

Who can I claim as my dependent?

You can claim a child, relative, friend, or fiancé (etc.) as a dependent on your 2018 taxes as long as they meet the following requirements:

Qualifying child

• They are related to you.
• They aren't claimed as a dependent by someone else.
• They are a U.S. citizen, resident alien, national, or a Canadian or Mexican resident.
• They aren’t filing a joint return with their spouse.
• They are under the age of 19 (or 24 for full-time students).
  • No age limit for permanently and totally disabled children.
• They live with you for more than half the year (exceptions apply).
• They didn't provide more than half of their own support for the year.

Qualifying relative

• They don't have to be related to you (despite the name).
• They aren't claimed as a dependent by someone else.
• They are a U.S. citizen, resident alien, national, or a Canadian or Mexican resident.
• They aren’t filing a joint return with their spouse.
• They lived with you the entire year.
• They made less than $4,150 in 2018 ($4,250 in 2019).
• You provided more than half of their financial support.

When you add someone as a dependent, we'll ask a series of questions to make sure you can claim them.

Related Information:                 

• Does a dependent have to live with me?
• What does "financially support another person" mean?
• Can I claim myself or my spouse as a dependent?
• Can I claim my parent as a dependent?
• Can I claim a newborn baby?

 

[fanfare]

If you claimed that dependent then she will not be able to claim "not a dependent" and IRS will not approve the payment.

The only way she might get it is if IRS pays first and asks questions later - unlikely IMO.

[Hal_Al]

Q. If she files her own taxes for 2020 she will then the $1200 stimulus check that was issued in 2020. Is this correct?

A. Simple answer: Yes.  But, as others have said, she must qualify to claim herself. There are two definitions of "file her own taxes".  1. She actually files a tax return because she has sufficient income to be required to do. 2. Does she  claim her own exemption (claim herself) on her return.  

There is a rule that says IF somebody else CAN claim her as a dependent, she is not allowed to claim herself. If she has sufficient income (usually more than $12,200), she can & should still file taxes. But, if she qualifies as someone else's dependent, she checks the box on form 1040 to indicate that.  That box disqualifies her from getting the stimulus check. 

The fact that you don't actually claim her, on your 2020 tax return, is not enough.  She must not qualify as your dependent. 

"In essence, the stimulus check acts as an advance of your 2020 income tax refund. This means when a taxpayer prepares her 2020 income tax return, in 2021, there will be a line to include the section 6428 credit (line 30 on the 2020 form 1040). The credit on her 2020 return is subtracted by any amount received as a stimulus check in 2020, if any. If the amount she received as a stimulus check is less than the credit she is due, the difference will be included as part of her 2020 refund. If she has been overpaid by receiving the stimulus check, however, she will not be required to return any excess amount".

[Carl]

I get the impression your dependent is an undergraduate college student. When it comes to education expenses and other stuff, including the stimulus, there are two completely separate determinations that have to be made.

1) Who can claim the student as a dependent.
2) Who can claim all the education expenses and credits.

Item #1 is the deciding factor on the stimulus, and has nothing to do with item #2 when it comes to the stimulus.  Here's what needs to be understood on that front.

If the parent *QUALIFIES* to claim the student as a dependent and the dependent is required to file a tax return, then the student must indicate on their tax return that the *can* be claimed as a dependent on another tax return. It *does* *not* *matter* if the parent actually claims them as a dependent or not. The key word here is *QUALIFY*.

The student qualifies as a dependent if the following conditions are met.

1) The student was under the age of 24 on Dec 31 of the tax year and;

2) The student was enrolled as a full time student for *any* *one* *semester* that started in the tax year. (This includes the last year of high school) and;

3) The student was enrolled in an accredited institution (this includes high school) and;

4) The student is enrolled in a course of study that will lead to a degree or credentialed certification and;

5) The student did not provide more than half of their own support for the *entire* tax year.

For #5, understand that scholarships, grants, 529 distributions, gifts from Aunt Mary, money from mom and dad, and *any* *other* third party income received by the student *do* *not* *count* for the student providing their own support.  Ther are only two possible ways the student can have any claim to providing more than half of their own support.

1) The student was self-employed or had a job and earned sufficient income to justify a claim to providing more than half of their own support. That earned income must also exceed the total of any and all third party support (scholarships, 529 distros, etc) received in the same tax year. Additionally, all costs must be reasonable and within the guidelines set forth by the IRS.

2) The student was the "primary borrower" on a *qualified* student loan, and sufficient funds were distributed to the student in the tax year to justify a claim to providing more than half of their support. The funds distributed to the student in the tax year must also exceed the total of all third party support received by the student in the same tax year. Additionally, all costs must be reasonable and within the guidelines set forth by the IRS.

So if my assumption is correct your dependent does not qualify for a stimulus check. However, I could very well be wrong and it wouldn't be the first time. 🙂 The main thing is that if they get a check and the IRS later determines they did not qualify based on invalid information on the 2020 tax return,  the audit will not be only for the payback of the $1200.

Also understand the stimulus payment is not a simple thing of the IRS just giving money away. It's an advance on your 2020 (or 2021???) tax refund. The thing is, if your refund turns out to be less than the stimulus amount received, you won't have to pay back the difference.

However, if you received a stimulus payment when you should not have, I would fully expect any difference to be due and payable back to the IRS upon demand. But even that's not clarified in any IRS pub I can find on this.

[xmasbaby0]

The rule is that if she CAN be claimed as a dependent on someone else's tax return she must indicate that on her own tax return whether the other person claims her or not.  WHO is the dependent?  You have provided no details.  Is the dependent your child, a parent, a sibling, a girlfriend that lives with you....etc., etc., etc.  If you give us some details we can drill down on whether you can claim her.

IRS interview to help determine who can be claimed:

https://www.irs.gov/help/ita/who-can-i-claim-as-a-dependent

[NCperson]

This is tricky.

the critical question is CAN SHE be claimed on your taxes; whether or not you claim her is immaterial.  the question is NOT, DID YOU claim her.  

if she CAN BE, she is NOT eligible for the $1200, even if you don't claim her! 

see the difference? 

[fanfare]

@NCperson  We're all on the honor system here.

But $1,200 is a lot of money.

[NCperson]

@fanfare - not following your point!?!?!??! 

yes, it is the honor system, so if my parent chooses not to claim me on their taxes, even though they have the right to, I am not entitled to the $1200.  Did my comment not read that way above?????

https://www.irs.gov/newsroom/economic-impact-payment-information-center-topic-a-eip-eligibility

You are not eligible for a payment if any of the following apply to you:

• You may be claimed as a dependent on another taxpayer’s return (for example, a child or student who may be claimed on a parent’s return or a dependent parent who may be claimed on an adult child’s return).

Note that the IRS website states you are not eligible if you MAY BE claimed.  It does not state 'ARE CLAIMED'

[fanfare]

IRS says:

"Generally, you are eligible to claim the Recovery Rebate Credit, if you were a U.S. citizen or U.S. resident alien in 2020, are not a dependent of another taxpayer for tax year 2020,"

I was wrong in thinking that 2019 tax year would have an impact.