New parents could soon receive an extra bundle of joy: babies born in 2020 are eligible to receive up to $1,100 in stimulus money from the federal government.
If their parents were eligible to receive stimulus payments under either bill, they qualify for the child credits associated with those bills. Both new babies and newly adopted children can qualify as dependent minors, thus providing the stimulus check for dependents that other elegible parents already received.
Child credits for qualifying dependent minors mean $500 from the first stimulus bill and $600 from the second. Families that were eligible for the stimulus payments from both bills will be able to receive a total of $1,100 from the government per new child.
Both stimulus checks are advances on a 2020 tax credit, but were distributed early so that Americans in financial straits would not need to wait until filing their tax returns in 2021 to receive aid from the federal government.
How to get stimulus money for children born in 2020
Because the stimulus payments are based on 2018 or 2019 tax filings, in order to qualify for the additional stimulus money, new parents will need to file a 2020 tax return. Eligible parents will then receive a recovery tax rebate credit for the amount. Children born in 2019 to parents whose last tax filings were from 2018 could also make them eligible for the additional stimulus checks.
How to claim new dependents on your 2021 tax return
In order to claim a new dependent on your next tax return, all you have to do is update your dependent status. According to the IRS website, in order to qualify as a head of household, you will need to have a qualifying child or dependent.
The tax rebate credit extends beyond new babies — eligible people who did not receive their stimulus checks can claim the tax rebate credit on their 2020 filings using forms 1040 or 1040-SR.
According to the IRS website, claiming the rebate will generally increase the amount received on a person’s tax refund or, if they owe money, will lower the amount of taxes that they need to pay.