Here's an odd situation... Since the third stimulus payment can be based on 2019 or 2020 taxes, I have a bit of a situation. In 2019 I could claim my daugther as a dependent, so the Federal government deposited money into my account that included $1,400 for her recently because I hadn't filed my 2020 taxes yet. Now I am going through helping my daughter do her 2020 taxes and she IS NO LONGER MY DEPENDENT, and TurboTax is saying that she should have qualified for stimulus money. Well, only because she is no longer my DEPENDENT. If I had filed my 2020 taxes early enough, I wouldn't have received the $1,400 for her. Now TurboTax is asking if she received a stimulus check, and she didn't, but I of course did. Seems like a problem....
No, this is a situation the IRS is aware of and it is possible for a person to get a stimulus payment for 2020 and if they were claimed as a dependent in 2019 and qualified for the stimulus, the person claiming the dependent received the stimulus too. As long as you and she meet the requirements (which you do), it is not "double-dipping" because one person is not getting the stimulus twice.
Actually learned that she won't get the $1,400, she'll actually qualify for the first two stimulus payments now (the $1,200 and the $600)--I looked and saw this on the "Recovery Rebate Credit Worksheet" (IRS Form) . This website, offers an explanation of what I was seeing:
https://www.thepennyhoarder.com/taxes/stimulus-money-tax-refund/
Attention, Class of 2020: If your parents or someone else claimed you as a dependent in 2019 but they don’t in 2020, you could get an $1,800 credit — $1,200 from the first check and $600 from the second one — provided that you file a tax return.
Generally, you can be claimed as a dependent if you’re under 19, or you’re under 24 and a student, if your parents provide at least half of your support.
Yes......If you were claimed as a dependent in 2019 but not in 2020, you can still get the Recovery rebate credit on your 2020 return even if your parents got it for you. And actually if you were over 17 in 2019 they did not get it by claiming you as a dependent. They only get it for dependents under 17. They don’t have to pay any back.