Solved

Recovery Rebate Credit for EIP 3 for Dependent

Forum|Forum|4 years ago
April 13, 2022
1 reply
0 views

My wife and I are claiming my elderly Mother as a dependent for the first time on our 2021 filing. All is clear on the rules for that, but I don't know how to answer the question, late in the stop-by-step process, about letter 6475. My wife and I both received letters 6475 correctly stating we received our full EIP 3 ($1400+$1400=2800).

However, the program wants to file for a credit of $1400 for my Dependent Mother even though she received the actual EIP 3 payment last year. How do I account for this when the question asked is: does the letters 6475 for my wife and I match the $4200 amount we are "eligible" for. The truthful answer is "No", but that does not properly account for the fact that our dependent received her own payment.

Anyone have a way to handle this?

Regards,

Steve

Credit

Best answer by JamesG1

If you report, $4,200 and show a $0 Recovery Rebate Credit on line 30 of the Federal 1040 tax return, you likely will not receive the third stimulus payment.

The IRS intent seems to be for you to report only the letter 6475 information for you and your spouse. This IRS FAQ states:

For example, parents of a child born in 2021 – or parents and guardians who added a new qualifying dependent to their family in 2021 – did not receive a third-round Economic Impact Payment for that dependent and may be eligible to receive up to $1,400 for the dependent by claiming the Recovery Rebate Credit.

If you report $2,800 and show a $1,400 Recovery Rebate Credit on line 30 of the Federal 1040 tax return, you may receive the third stimulus payment from the IRS. This IRS FAQ states:

No, there is no provision in the law that would require individuals who qualified for, and received, a third-round Economic Impact Payment (including a plus-up payment) based on their 2020 or 2019 information, to pay back all or part of the payment if, based on the information reported on their 2021 tax returns, they would have qualified for a lesser amount.

The qualifications for the third stimulus payment are:

you were a U.S. citizen or U.S. resident alien in 2021,
you were not a dependent of another taxpayer’s 2020 tax return, and
you have a Social Security number.

There are income limitations are if your adjusted gross income (AGI) is more than:

$150,000 if married and filing a joint return or filing as a qualifying widow or widower
$112,500 if filing as head of household or
$75,000 if filing as a single or as married filing separately.

J

JamesG1Answer