‘The idea that she keeps these ill-gotten funds only heals me’: my 7-year-old granddaughter lives with me – yet her mother received her stimulant

When the stimulus checks came in, we didn’t get any for her. Her mother received money for both my grandchild and another child who was also taken out of custody in 2019. She did not give us any money (of course). We claimed our granddaughter on our 2020 taxes and received the stimulus credit for her.

My question is, will her mother have to reimburse the money she received for the children she did not have custody of in 2020? Should it be reported to someone? The thought that she keeps these ill-gotten funds saddens me.

Grandmother

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Dear Grandma,

It sounds uncomfortable so I’m more than happy to help.

Eligibility for the first and second round of stimulus checks issued by former President Donald Trump in 2020 under the Cares Act of 2020 was based on Americans’ 2019 tax returns or their 2018 tax returns, if their 2019 tax returns had not yet been filed. The second batch issued by President Joe Biden as part of the 2021 US bailout was based on American tax returns for 2020. These are tax credits, not a loan, and as such, they do not have to be reimbursed.

Since you did not declare your granddaughter as a dependent last year, the Internal Revenue Service is unlikely to require your daughter to return the money for your granddaughter. It all depends on the timeline, of course. I cannot discuss the situation with the other child. If your daughter has declared that your grandchild was dependent on the third economic stimulus payment – when you are its legal guardian and claimed it on your tax return – the IRS will collect this.

Claiming false deductions is tax evasion and is considered a crime. Your daughter, like everyone else, files her taxes under pain of perjury. “However, the IRS will only consider alleging malicious fraud if the taxpayer has shown will. Without intent, the offense is considered negligence. There are still penalties for negligence; it is your responsibility to know the rules, but it is not a crime ”, according to Communitytax.com.

If you think your daughter claimed money that wasn’t hers in 2020? You can fill out a refund trail or Form 3911 and / or choose a taxpayer lawyer service who has remote workers in law schools working to help people in situations like this, and legal aid. If you hadn’t become your granddaughter’s legal guardian until last year, this can be difficult to make a case for. You need to weigh the hassle of pursuing this against your happiness and that of your granddaughter.

Ultimately, she’s the mother of your granddaughter, so causing her more problems – whether she deserves it or not – can end up hurting your family.

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