Tax Guy: ‘My dad claimed me as a dependent on his 2018 return. I haven’t filed my 2019 return. Can I still claim $1,200? Answers to your stimulus check questions (Part 2)

Tax Guy: ‘My dad claimed me as a dependent on his 2018 return. I haven’t filed my 2019 return. Can I still claim $1,200? Answers to your stimulus check questions (Part 2)

17 Apr    Finance News

Read Part 1 of this column here.

The feds are using our beloved Internal Revenue Service to distribute so-called Economic Impact Payments (EIPs) to many Americans, also known as “stimulus checks.” Singles can receive up to $1,200, married couples can receive up to $2,400.

Minor kids under the age of 17 are worth up to another $500 each. However, EIPs are phased out at higher income levels — based on your 2019 Form 1040 if you’ve already filed it, or your 2018 Form 1040 if you have not.

The IRS is not currently processing 2019 returns. The agency is swamped with all the new COVID-19-related tasks it has been given. Worse yet, the IRS’s data processing systems were notoriously inadequate even before getting overwhelmed with all the new tasks.

Here are answers to some of your questions received:

Q: I’m a 19-year-old college student. My dad claimed me as a dependent on his 2018 return. I have not filed my 2019 return yet. Can I get an EIP if I file my 2019 return right now and my dad does not claim me as a dependent on his 2019 return?

A: Yes. The real question is how long it will take the IRS to process your 2019 return and your dad’s 2019 return. In your situation, processing those returns is necessary to determine your eligibility for an EIP. As I said earlier, the IRS is not currently processing 2019 returns, so you could be in for a long wait. Make sure you supply automatic deposit information with your 2019 return. That will speed things up. We hope.

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Q: I have not received my EIP, and I think I know why. I was claimed as a dependent on my parent’s 2018 return. I’ve already filed my 2019 return and received a refund. My parents already filed their 2019 return, and they already received their $2,400 EIP. Will I get my EIP?

A. Yes, assuming your parents did not claim you as a dependent on their 2019 return. If they did claim you as a dependent for 2019, you won’t get your rightful EIP until you’ve filed your 2020 Form 1040 next year, as explained in answer No. 3. However, as I said earlier, the IRS is not currently processing 2019 returns. If your 2019 return has not yet been processed, it could a while before you get your rightful cash. How long? Who knows?

Q: In 2019 I made too much money to be eligible for an EIP. Unfortunately, I was laid off in November of last year and given a severance package that put my 2019 income over the EIP phase-out threshold. Is there anything I can do to receive an EIP?

A: Yes, but not anytime soon. As explained in answer No. 3, you’ll receive your rightful EIP in the form of a tax credit that you can claim on your 2020 Form 1040, when you file it sometime next year.

Q: I’m an independent 24-year-old who works while attending college part time. On my 2019 Form 1040, I accidentally checked the box that says I could be claimed as a dependent on another return (my parents’ return). My parents did not claim me as a dependent for 2019 and they did not claim me for 2018 or 2017 either. Will I still receive an EIP? Or should I file an amended 2019 return on Form 1040-X to ‘uncheck’ the box that says I was claimed as a dependent on another return?

A: Unfortunately, there is no place on Form 1040-X to “uncheck” that box. In your specific situation, I think the only solution is to file your 2020 Form 1040 next year to “true up” your rightful EIP amount, as explained in answer No. 3. That will involve a long wait. Maybe the IRS will come up with a quicker way to solve your problem. But don’t hold your breath, because I think it’s pretty unusual.

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Q: I believe that my adult son received a $1,200 EIP, via automatic deposit to his checking account, that he was not entitled to because he is my tax-return dependent. Will the IRS go into his checking account and debit it to get the money back?

A: No. The statutory language in the CARES Act that set the whole EIP scheme in motion says that anybody who gets more money than they are actually entitled to can keep the excess. I endorse that concept: any money that gets into people’s hands is fair game.

Q: I did not have enough income to file a Form 1040 for 2018 or 2019. How can I get my EIP?

A: The IRS website now offers an online tool for non-filer like you. Go here and follow the instructions. Will this work in a timely fashion? We shall see. If any of you out there have used this tool, please tell us about your experience in the comments.

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