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Economic Impact payments received in 2020

DJ
Level 2

In 2020 taxpayers used 2018 tax return to receive their rebate for him, his wife and once child.  However in 2019 he had a second child that he did not receive a situlas for. Can he file to get this back and if so how would he file? and does he have to use 2020 income limitation and not the prior year that was used originally because 2020 is way over the 150,000 threshold. 

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qbteachmt
Level 15

"because 2020 is way over the 150,000 threshold."

Perhaps it would help to review what is really happening for EIP “stimulus” funds: The funds were paid out as Advanced payment against a projection. The first two payouts were projected based on 2018 or 2019 tax returns, but the eligibility is part of tax year 2020 as 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 eligible for consideration as individual filers. That doesn't mean "not being claimed." It means "no longer qualifies as a dependent." You must correctly address whether they Can be Claimed as a dependent on someone else’s tax return.

The third payout which started in Jan 2021, has different eligibility rules as to dependents and this payout is a projection, using 2019 or 2020 tax returns, then reconciled against Actuals on the 2021 tax return.

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

Interactive wizards portal includes one 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

https://www.irs.gov/newsroom/irs-is-issuing-third-round-of-economic-impact-payments

One for each of the three EIP “stimulus” payments.

*******************************
"Level Up" is a gaming function, not a real life function.

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IRonMaN
Level 15

It all falls on the 2020 return now.  If they are over the threshold, they will only get part of the credit, if any.

Barber! Why didn't I think of this before? Getting paid to give out bad tax advice - need I say more? I've run with scissors for years so it is a natural fit.
BobKamman
Level 13

 

Situla (plural situlae), from the Latin word for bucket or pail, is the term in archaeology and art history for a variety of elaborate bucket-shaped vessels from the Iron Age to the Middle Ages, usually with a handle at the top. All types may be highly decorated, most characteristically with reliefs in bands or friezes running round the vessel.

Decorated Iron Age situlae in bronze are a distinctive feature of Etruscan art in burials from the northern part of the Etruscan regions, from which the style spread north to some cultures in Northern Italy, Slovenia, and adjacent areas, where terms such as situla culture and situla art may be used.

Situla is also the term for types of bucket-shaped Ancient Greek vases, some very finely painted. More utilitarian pottery situlae are also found, and some in silver or other materials,such as two glass ones from late antiquity in St Mark's, Venice. Ancient Egyptian and Near Eastern shapes tend to have a pointed bottom, so that they must rest on a stand or on their side. The practical wider shape is a European invention, first seen in the European Bronze Age.

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qbteachmt
Level 15

"because 2020 is way over the 150,000 threshold."

Perhaps it would help to review what is really happening for EIP “stimulus” funds: The funds were paid out as Advanced payment against a projection. The first two payouts were projected based on 2018 or 2019 tax returns, but the eligibility is part of tax year 2020 as 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 eligible for consideration as individual filers. That doesn't mean "not being claimed." It means "no longer qualifies as a dependent." You must correctly address whether they Can be Claimed as a dependent on someone else’s tax return.

The third payout which started in Jan 2021, has different eligibility rules as to dependents and this payout is a projection, using 2019 or 2020 tax returns, then reconciled against Actuals on the 2021 tax return.

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

Interactive wizards portal includes one 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

https://www.irs.gov/newsroom/irs-is-issuing-third-round-of-economic-impact-payments

One for each of the three EIP “stimulus” payments.

*******************************
"Level Up" is a gaming function, not a real life function.

View solution in original post

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