Level 6

Newly independent taxpayer in 2020

Forum|Forum|5 years ago
September 17, 2020
2 replies
23 views

Wondering about the answer to these hypothetical client questions:

In 2019 I was a dependent and in college full time. My parents claimed me and they got $500 for me as part of the stimulus. But in 2020 I was independent and I plan to file my own taxes. Will I be able to claim my $1200 as part of the first stimulus on my 2020 taxes? And oh, I forgot. Will my parents have to pay back the $500 they got for me for the first stimulus if I get $1200 for it on my 2020 taxes?

ProSeries Tax

This topic has been closed for replies.

qbteachmt

Level 15

This seems to be the plan: Since the stimulus payments were an advance on a tax credit, then if they don't qualify for the full amount they got, their difference will show on the tax return as part of what is Owed against whatever got paid through estimates and/or withholding, like any other credit.

Google this phrase:

stimulus check tax credit

Don't yell at us; we're volunteers

C

cinmon428Author

Level 6

So you believe that the taxpayer now filing independently in 2020 will get a credit of $700? ($1200 minus the $500 the parents got for the dependent taxpayer in 2019.)

itonewbie

Level 15

@cinmon428 wrote:
So you believe that the taxpayer now filing independently in 2020 will get a credit of $700? ($1200 minus the $500 the parents got for the dependent taxpayer in 2019.)

That part of the law is not as clear, if I recall, as the reference is made in relation to the "eligible individual" and "eligible individual" refers to only the taxpayer (and spouse, if MFJ). Since "qualifying children" are not "eligible individuals", it may create an unintended consequence that the full Recovery Rebate could be allowed on this newly independent child's return. May like to research this a little deeper.

---------------------------------------------------------------------------------Still an AllStar

itonewbie

Level 15

Misread question. Deleted response.

---------------------------------------------------------------------------------Still an AllStar

Sign up

Login with SSO

Let's get you signed in

Login with SSO

Scanning file for viruses.

This file cannot be downloaded