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CLAIMING DEPENDENT FOR EIC

ACHUTNEPAL
Level 1

I HAVE A CLINT, HAVE A DEPENDENT STUDENT(he /or she was claimed as dependent last year and missed stimulus payments) ,AND DEPENDENT HAS INCOME, WILL FILE OWN RETURNS AS SINGLE. DEPENDENT LIVES WITH PARENTS FOR WHOLE YEAR, CLINT WANTS TO CLAIM HER/ HIM ONLY FOR EIC AND NOT AS DEPENDENT. OR SUPRESS  DEPENDENT THIS YEAR. CAN WE DO THAT WAY? ALSO WHEN DEPENDENT FILES THE RETURN, WILL HE/SHE BE ABLE TO GET FUTURE STIMULUS CHECK? AND CAN SAME DEPENDENT CLAIM THE STIMULUS THAT WAS MISSED? IF DOING SO WHAT WOULD BR DEPNDENT'S DEPENDENCY STATUS?

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6 Replies 6
IRonMaN
Level 15

Clint wants the best of all worlds.  Clint is going to be disappointed when he finds out it don’t work that way.


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BobKamman
Level 15

Typos are allowed here but ALL CAPS is not. 

Tax preparers are allowed to tell clients what to do but clients are not allowed to tell preparers what to do.

Sometimes the most significant fact is the one left out of the question.  Like, how old is the (allegedly non-)dependent?  She was just 17, you know what I mean?  (Apologies to those who weren't around in 1963 and listening to the Beatles.)  

IRonMaN
Level 15

I didn't realize that's who we were talking about.  My glasses fog up once in awhile if my mask isn't on just right and that's why I must not have seen her standing there.


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TAXOH
Level 11
Level 11

You can't always get what you want But if you try sometime you find You get what you need....Rolling Stones

TaxGuyBill
Level 15

You are calling the student a "dependent" so I am assuming that is ELIGIBLE to be claimed as a dependent by his parents.

The short answer is if the child is ELIGIBLE to be claimed as a dependent, the child does NOT qualify for the Stimulus Payments and you MUST tell the program that he CAN be claimed as a dependent. 

While it is sometimes possible for the parent to claim EIC without claiming a child as a dependent, unless the dependent child would benefit from the non-refundable portion of the American Opportunity Credit, I don't see any reason for the parent to not claim the child as a dependent.

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qbteachmt
Level 15

"ALSO WHEN DEPENDENT FILES THE RETURN, WILL HE/SHE BE ABLE TO GET FUTURE STIMULUS CHECK? AND CAN SAME DEPENDENT CLAIM THE STIMULUS THAT WAS MISSED?"

Where's the counter? Yet another tax preparer not only doesn't know the requirements, but is letting the client lead the parade.

@ACHUTNEPAL 

You need to Know this and control the client's expectation for trying to dodge the rules.

 

Perhaps it would help to review what is really happening:

The funds were paid out as Advanced payment against a projection. The projection used 2018 or 2019 tax returns. But 2020 is the Actuals. You use the 2020 return to reconcile what a person is entitled to, against what they got.

If the person is not a dependent in 2020, then they would be entitled to the payment/credit as individual filers. That doesn't mean "not being claimed." It means "no longer qualifies as a dependent."

You might want to bookmark these links and read the IRS guidance.

Interactive wizards portal for determining dependency:

https://www.irs.gov/help/ita

And:

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

https://www.irs.gov/coronavirus/second-eip-faqs#Eligibility

One for each EIP.

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