Received 3rd stimulus, $2800 total, $1400 for my dependent child, he was my dependent in 2020 but will not be 2021, will I have to pay back $1400 I received for him?

[cherylgrimes1]

By putting the full 4200 in there, that number didn't change anything.

I was asking IF we have to claim her because she mostly supported herself, even if it was by living on a credit card and at friends and family's homes, borrowing money from us as needed that she will be paying that back from her savings we put aside for education. 

She lived here off and on. We fed her when she was home. And she was a full time college student. Thanks for your help @VolvoGirl 

[cherylgrimes1]

@VolvoGirl also, she checked that she could be claimed, but wasn't

[cherylgrimes1]

@VolvoGirl I ended up just claiming her, and getting a deduction, even though she ended up having a 22% tax rate because of our income, and now owes $3500! Anyway, new question is: do you know how to get back to the interview for 8615 (that reports our income which makes her owe so much)? I noticed in the "forms" view that it didn't showed our capital gain losses. Not sure if that makes any difference, but I want to make sure this is right before I file.

[JamesG1]

In TurboTax Online, you are able to access the questions for IRS Form 8615 Tax for Certain Children Who Have Unearned Income at:

Federal / Wages & Income / Your income / Less common income / Child's income (under age 24)?

[nseifert08]

I have two children (under 3), they live with me and their father but we are not married so we filed separately. I claimed them for 2020, he is claiming them for 2021, per our agreement to switch off years that we can/are allowed. I got their stimulus payments because they were on my taxes in 2020, but then his taxes prompted that he's going to get the recovery rebate since he is claiming them and didn't get the money for them. My children are very young, so we aren't much used to dealing with dependents and the rules which is why this never crossed my mind. We have otherwise super simple taxes and paying someone $400+ (between us both) to file them just didn't seem the logical thing. So we went ahead and left it be, figuring he would set that money aside so if it has to be repaid by me then it is there for that. Will they make me re-pay it? I cannot find anything online about this situation when it is a person remaining a dependent but being switched to being claimed by someone else. All I see is that if they were a dependent for 2020 but then weren't for 2021 then they can get their own rebate and the original filers don't have to pay back, but I can't find out if it is the same for dependents just switching to being claimed by someone else!

[VolvoGirl]

If he is claiming them this year then he does get it.  And you don't have to pay it back.  It is really based on 2021.  The IRS just used 2020 returns to send the checks out fast.  This is a common situation.  It is a IRS loophole.

See Question 15 here

2021 Recovery Rebate Credit — Topic E: Calculating the 2021 Recovery Rebate Credit | Internal Revenu...

[nseifert08]

Thank you so much, especially for the fast reply!

[mikejen93]

Is there a link you could add from the IRS website, or anywhere else to support this? Our daughter is in the same situation.  Was our dependent in 2020, isn't for 2021, and we got $1400 for her but I think she's entitled to get $1400 herself.  Anywhere you can lead me?

[fanfare]

@mikejen93 

File for the Rebate Credit. IRS will either approve or deny.

Denials are for tax filers who file incorrectly or already received the stimulus payment.

[xmasbaby0]

@mikejen93 She is not a dependent for 2021?

From the IRS:

https://www.irs.gov/coronavirus/third-economic-impact-payment

https://www.irs.gov/newsroom/2021-recovery-rebate-credit-topic-c-eligibility-for-claiming-a-recovery...

Eligibility

Most eligible people didn't need to take additional action to get a third payment.

Generally, someone was eligible for the full amount of the third Economic Impact Payment if they:

• are a U.S. citizen or U.S. resident alien (and their spouse if filing a joint return), and
• are not a dependent of another taxpayer, and
• had adjusted gross income (AGI) that is not more than:
  • $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 any other filing status

Payments were phased out – or reduced – above those AGI amounts. This means people did not receive a payment if their AGI was at least:

• $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
• $80,000 for any other filing status

Q C3. Change in Eligibility: If I received a third Economic Impact Payments and, based on my 2021 ta...

A3. No, if you qualified for a third payment based on your 2019 or 2020 tax return, the law doesn’t require you to pay back all or part of the payment you received based on the information reported on your 2021 tax return.

Q C9. Dependents: I didn’t receive the Economic Impact Payment because I was claimed as a dependent ...

A9. Maybe. If you were claimed as a dependent on someone else’s tax return for 2020, you were not eligible for the third Economic Impact Payment. If no one can claim you as a dependent for 2021 and you are otherwise eligible, you can claim the 2021 Recovery Rebate Credit on your 2021 tax return.

Married persons who didn’t receive the third Economic Impact Payment should determine their eligibility for the Recovery Rebate Credit when filing their 2021 tax return.  You and your spouse can’t be claimed as a dependent on someone else’s return for the 2021 tax year if you claim the 2021 Recovery Rebate Credit on a joint tax return that you and your spouse file together. See Joint Return Test PDF under Dependents in Publication 501, Dependents, Standard Deduction, and Filing Information.

If you file electronically, the tax preparation software will help you figure your 2021 Recovery Rebate Credit. Visit IRS.gov/filing for details about IRS Free File, Free File Fillable Forms, free VITA or TCE tax preparation sites in your community or finding a trusted tax professional. The Recovery Rebate Credit Worksheet in the 2021 Form 1040 and Form 1040-SR instructions can also help calculate the credit.

[VolvoGirl]

@mikejen93 

Yes I think I posted the link above.  .If you got a Stimulus payment for a dependent you aren't claiming for 2021 you don't have to pay it back.  And they can get it on their own 2021 return.   On their return they say NO they didn't get it - because you did.

The 3rd Stimulus payment is really based on 2021.  The IRS just sent the checks out using 2020 to get them out fast.

See IRS Topic B first question

Questions and Answers about the Third Economic Impact Payment — Topic B: Eligibility and Calculation...

[NCperson]

@mikejen93 - she just needs to file for 2021 and state she did not receive the stimulus (you did).  have her look at Line 30 of HER tax return...what is there? should be $1400