Parent received stimulus for 2019 dependent

[JT2307]

Taxpayer was in college and a dependent on Parents return for 2019 - graduated and was in the workforce all of 2020 - essential worker - she has not filed yet and neither did the parents and today the parents received the $1400.

Will she receive ALL three stimulus payments when she files her 2020 return or just the first two? I couldn't find an answer on that. Any thoughts?

[TaxGuyBill]

The 2020 tax return only covers the first two stimulus payments ($1200+$600).

The third stimulus ($1400) is on the 2021 tax return. However, if the parents already received the $1400 for the child, this third stimulus seems to indicate that your client (the 'child' will NOT be able to claim another credit on her 2021 tax return. It will be a limit of one credit per ID number (Social Security Number).

[Lion]

If the "child" is not a qualifying dependent for her parents in 2020, when she files her own return, she will receive her RRC1 and RRC2. Plus she'll receive her EIP3, per the IRS that says they will be making catch-up EIP3 payments through the summer. And, the "child" has one last chance on her 2021 return in 2020 for RRC3 if she hasn't received the max EIP3.

[TaxGuyBill]

If the "child" is not a qualifying dependent for her parents in 2020, when she files her own return, she will receive her RRC1 and RRC2. Plus she'll receiver her EIP3, per the IRS that says they will be making catch-up EIP3 payments through the summer. And, the "child" has one last chance on her 2021 return in 2020 for RRC3 if she hasn't received the max EIP3.

But the law for the third stimulus essentially says one credit per SSN. So if the parents already received it, she hypothetically shouldn't receive the third credit.

[JT2307]

But yet the first and second were issued to the custodial and non-custodial if they alternated years. I guess we will have to wait and see -

[Lion]

So, whoever files first, gets it?! This'll be like dealing with divorced parents who both claim the same dependent. I think it's time Congress pays us an EIPTP for Tax Preparers to deal with their every-changing laws!

[TaxGuyBill]

We don't know the actual mechanisms of it yet. The law just said the IRS needs to make Regulations or guidance about it one credit per person.


‘‘(h) REGULATIONS.—The Secretary shall prescribe such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including— ‘‘(1) regulations or other guidance providing taxpayers the opportunity to provide the Secretary information sufficient to allow the Secretary to make payments to such taxpayers under subsection (g) (including the determination of the amount of such payment) if such information is not otherwise available to the Secretary, and ‘‘(2) regulations or other guidance to ensure to the maximum extent administratively practicable that, in determining the amount of any credit under subsection (a) and any credit or refund under subsection (g), an individual is not taken into account more than once, including by different taxpayers and including by reason of a change in joint return status or dependent status between the taxable year for which an advance refund amount is determined and the taxable year for which a credit under subsection (a) is determined.

[Bucky]

I believe Tax Guy Bill has it correct according to the bill. If you look in the tax book document they provided you will see it.

[Twin Turbo Z]

I will throw a wrench in this debate. Had couple who claimed daughter in 2019. But have not filed 2020 yet. Daughter filed 2020 return, first week IRS opened the gate and received the $1800. Then the IRS started depositing the $1400. Well the parents who have not yet filed for 2020 received extra $1400 for daughter and the daughter received it too. Hmmm