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stimulus

no1031
Level 1

My clients son was 16 in 2019 so they received $500 on the first stimulus for him. Now he is over 18 and filing as single claiming himself, will he get the $1200 or $700 on the recovery rebate

 

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TaxGuyBill
Level 15

As was pointed out above, is he ELIGIBLE to be claimed as a dependent?  It seems very likely that he is.  If that is the case, the kid does NOT qualify for the credit.

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14 Replies 14
Just-Lisa-Now-
Level 15
Level 15

Yes, but are you sure he doesn't qualify as a dependent of his parent anymore?  Does he provide more than 50% of his own support?


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BobKamman
Level 15

How did he go from being 16 in 2019 to being over 18 in 2020?

A lot of parents are helping their kids with this scam.  Time will tell if IRS catches up with them.  

Just-Lisa-Now-
Level 15
Level 15

Must have had a birthday early 2021 and no131 isnt taking into account that in 2020 he was still 18


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no1031
Level 1

he was 16 until 12/24/2019 when he turned 17. They received the 500. He turned 18 on 12/24/2020 and began a high paying automotive job.

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sjrcpa
Level 15

So for 2020 he was not a full-time student for 5 months and provided over 1/2 his support?

TaxGuyBill
Level 15

He was age 17 for most of 2020. Did he really have a lot of income in 2020?  As was noted a LONG time ago, you need to determine if he qualifies as a dependent.  Assuming he was a full-time student for at least parts of 5 months, that mean did he pay for over 1/2 of his own support?

 

As a side note, if he turned age 17 in 2019, then the parents received the $500 credit based on their 2018 tax return, not 2019.

qbteachmt
Level 15

"He turned 18 on 12/24/2020 and began a high paying automotive job."

Is he is not able to be claimed as someone else's dependent for 2020? As the link I gave shows, this means No Longer Qualified to be claimed. That would be different than "not being claimed."

And the amount per Adult who files their own tax form is $1800.

That's why you need to read those links, work the dependent wizard, and go through the process for the analysis for your own understanding. Bookmark those links.

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Accountant-Man
Level 12

He was 17 in 2019, not 16 "for most of the year." His parents should not have received $500 for a 17 year old.

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qbteachmt
Level 15

"His parents should not have received $500 for a 17 year old."

The first stimulus was paid out early enough that most people got it based on the 2018 tax returns. The filing of the 2019 tax return would show him as no longer qualified.

And still being qualified as a Dependent would mean there is no further money for the parents or this child, for 2020.

And there is no qualified person who gets $1200. That isn't in the law.

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qbteachmt
Level 15

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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no1031
Level 1

ok so go for the full 1200 recovery on his return even though the parents received a 500 stimulus for him a year ago (based on 2019's) I didn't know if they were doing a SS# cross reference

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TaxGuyBill
Level 15

As was pointed out above, is he ELIGIBLE to be claimed as a dependent?  It seems very likely that he is.  If that is the case, the kid does NOT qualify for the credit.

qbteachmt
Level 15

"ok so go for the full 1200 recovery on his return"

But that isn't how the stimulus works. Did you look at those Links? You need to learn this. You are supposed to be able to answer this.

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no1031
Level 1

thank you

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