Spouse died, gets recovery rebate credit

[Possi]

Am I missing something? A deceased person can't get a check or a payment... but CAN get the recovery rebate credit? 

https://www.aarp.org/money/taxes/info-2020/stimulus-check-in-deceased-name.html#:~:text=Individuals who died in 2020,made out to the dead.

Paragraph 4:  "Individuals who died in 2020 may be eligible for a Recovery Rebate Credit on their 2020 taxes if they did not receive a second stimulus check."

My client's husband died in 2020. She got the first full payment, but $600 on the second payment. I THINK she gets this $600 credit on the 2020 tax return. 

[Margaret CPA in OH]

Good question.  One client's spouse died in early April and she sent half of it back as it was posted in FAQ's at the time.  I will have to ask her if that check was cashed.  If so, I will input that she received just $1200 for first.

[Abby Normal]

46 minutes ago, Possi said:

I THINK she gets this $600 credit on the 2020 tax return. 

Correct.

[Possi]

8 minutes ago, Abby Normal said:

Correct.

YAYYY! I'm a ROCK STAR for a moment! 

[TAXMAN]

What is your opinion on dead people stimulus checks from 1st payment? Have some that went to estate then distributed to heirs then estate closed. Have some where spouse is still alive and already spent $.

[schirallicpa]

I also have a client where the spouse died in 2018 and he received his and her payments for the 1st round.  Now I'm looking at the worksheet for the recovery in the program and I'm not seeing how to pay back.  (He did not know he had to pay it back in April when he got it. )  Poor ol' guy.  Thinking about letting sleeping dogs lie.

 

[Lynn EA USTCP in Louisiana]

Schirallicpa - the client does not have to pay back the extra EIP received.  While the IRS might say to return those extra funds, there's no payback requirement in that stimulus package.

[jklcpa]

Schirallicpa - I think that is what happened with one of my clients too where wife died in April 2019. He says he always makes a partial, rounded deposit of checks he receives, and he deposited $2,000 right around the end of April 2020 when he would have received EIP#1, and then didn't get the EIP#2 at all.

I filed his return with him getting his full $1,200 for EIP#1, -0- for EIP#2, and claimed the RRC for the $600.  No way to even include anything for the wife now since he is now filing as single, not MFJ.  

[schirallicpa]

thank you jklcpa and Lynn - I will not worry about him.  (It makes me feel good because he's probably the nicest man in the world.  He deserved the extra.)