The stimulus payments and unemployment are causing a lot of confusion with a number of my clients returns.

I have several young adults with income between $15,000 and $25,000 due to the massive unemployment received under the Covid bill.  This added to their other income is generating the question.  Should they be claimed as a dependent? 

Taking them off their parents returns immediatly qualifies them for the first two stimulus payments.  In addition, their is the opportunity of the education credits.

Another tax planning opportunity ~ married filing seperate.  I just did a return where the taxpayers have been filing seperate over the pass few years for personal reasons, but now it has come to light, one of them is eligible for the stimulus.  If they filed jointly, stimulus would be zero.

In these long days of tax preparation, I would love to hear your thoughts on the above.

Kindly,

Jean 😉