For parents who share custody of their children, child support can add complications to theirand . To add to this, the rules of have changed , by removing a loophole that allowed some families to “double down” (both parents receiving their own dependent payment for the same child), among other major changes.
However, there is good news for Center report on budgetary and policy priorities. It is in addition to the for eligible people and the new bill , which leads many families to receive more money this time around.. the includes a large extension of the which could reduce child poverty by 40%, according to a
Here are the details we have so far, including, and what if your . (Also, could there be a ?) Read on as we sort out and explain the complicated details of child support situations and stimulus checks.
Is the loophole for shared custody and stimulus checks closed for the third payment?
Many unmarried parents who share joint custody of their children actually received two payments for the same child in the first round of stimulus checks, if they alternated the years claiming these children on their taxes. . In other words, if one parent claims a child for an even year and the other for an odd year, both can receive checks for that child. That’s because the IRS looked at two different tax years – 2018 and 2019 – to determine eligibility for the first check.
For the second stimulus check, the IRS only looked at the 2019 tax returns, but that doesn’t mean the double loophole has been closed entirely. If you are a parent in a joint custody scenario like the one above and typically apply for a dependent child in odd tax years, you may be able to get a duplicate dependent child payment of $ 600. asand claim the child on your tax return, just as you would if you didn’t receive a second stimulus check when you were eligible.
This loophole could be closed in the new stimulus bill which authorizes the third check. According to Andy phillips, director at The Fiscal Institute at H&R Block, parents who are not married to each other and who alternate custody of an eligible dependent may not both be eligible to receive stimulus funds for the same dependent this time around.
Phillips said that due to Congressional directives included in the new law, “it is possible that if an advance payment is received by a parent for the dependent, no additional payment can be made for the same dependent. on the return of the other parent (by claiming the credit recovery reimbursement). ” Phillips said the Treasury Department should release guidance on this situation, but at this time it hasn’t yet.
How does child support relate to the third stimulus payment?
With the third check, if you are behind on child support, you can still receive your full stimulus payment. He. This is true for any past due federal or state debt: your third payment is not subject to reduction or set-off. However, private debt collectors may be able to redirect your payment to cover a debt.
Too, IRS can withhold all or part of a stimulus payment if you claim it as when you file your taxes. A independent taxpayer advocacy group within the IRS is working with the agency to resolve this issue.
New guidelines for dependents open up eligibility for third stimulus payment
What you need to know about the 2021 child tax credit
the CNBC, parents of dependent children may be able to use the same even / odd tax reporting method for both receiving payments. The U.S. Treasury and IRS have yet to offer guidance on how they will administer advance payments to parents under shared custody arrangements, CNBC said.until to tax holders . According to
How Other Eligibility Changes Affect Your Stimulation Test
thewhich means that . Checks are accompanied by a , so that if you made more than a certain amount – say, $ 120,000 as a head of household – you wouldn’t be even if you have multiple dependents. The date , and when the IRS processes this payment, could also play an important role in whether or not you receive a full or partial payment, or maybe none.
For more, here’s all you need to know about until and how .