Under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, most Americans are eligible for another round of stimulus checks (also called Economic Impact Payment). Individuals who reported adjusted gross income of $75,000 or less on their 2019 tax returns will receive $600 each and $600 per child. The same goes for couples filing jointly with $150,000 or less of adjusted gross income or $112,500 or less for head of household. The Biden Administration has indicated that one of his first acts upon taking office is to request an additional $1,400 in stimulus payments for individuals. So what about the child’s portion of the stimulus payment? How does your divorce affect that payment?
The new law states that the child’s stimulus payment will be paid to the parent that claimed the child as a dependent on his/her tax return last year. There are various complications with that concept, such as what if the parties filed a joint return last year and are now in the process of, or have completed, a divorce? What happens if, in the divorce proceeding, or thereafter, it was agreed that the dependency exemption would be alternated? The answer is not an easy one and may require the assistance of an attorney to answer this question The legislation seems to indicate that the children’s portion of the stimulus will be paid to the parent who claimed the child as a dependent on the last tax return, however, that may not agree with the terms of a divorce decree.
It is imperative that you discuss this matter with an attorney in your state, if you and your spouse cannot agree. If you are currently involved, or have been involved, in a family law case, it is important to get legal advice regarding this issue.