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Second stimulus FAQ: Do 2020 babies count? What about dependent college students?

"Unfortunately, there are definitely winners and losers," said Ken Eshleman, a senior partner with Domani Wealth.

Does your child qualify for $600 if born in 2020? What about dependent college students? Are they eligible for the extra cash? Many people have questions about the second round of stimulus payments, and we're getting answers.

According to the IRS, millions of Americans will receive a second stimulus.

Check the status of your first Economic Impact Payment. Some people received their Economic Impact Payment in partial payments. If you received partial payments, the application will show only the most recent. Confirm your payment type: direct deposit or by mail.

"Unfortunately, there are definitely winners and losers," said Ken Eshleman, a senior partner with Domani Wealth.

In the winner category, there is $600 available  for most people who made under $75,000 dollars in 2019, and $1,200 for married couples who filed their taxes jointly in 2019 and made under $150,000.

What about their kids?

"I think it's rather simple in the sense it is a dependent and they are under the age of 18, they are eligible to receive a stimulus check," explained Eshleman.

"Prepare for the future," is one of the things you'll hear Ken say regularly. His passion is helping people meet their financial goals and objectives with the best customized plan for them. In his role as a Senior Wealth Advisor and CERTIFIED FINANCIAL PLANNER ®, Ken sits down with clients to learn as much as he can about them, including their backgrounds, careers, interests, and families.

There is $600 available, which is $100 more than the first round of checks for dependents under 18. However, adult dependents do not qualify, according to the Tax Foundation. That means college students who depend on their parents miss out on the stimulus for the second time in a row.

"I know there is definitely situations, especially single mothers, where, I can think of one example, had a child who just turned 18, but he is still dependent, living in the house, and she is not going to get a stimulus check for him, and she really needs it," added Eshleman. 

On the other hand, the IRS says generally self-supporting college students who paid at least half of their own living expenses in 2019 are eligible for the extra cash.

What about babies born in 2020?

Children born before December 31 qualify for both rounds of stimulus payments, according to the IRS. 

If you do the math, the combined total is $1,100. However, since the IRS has used 2019 tax returns for its automatic stimulus payments, it is not aware of those beautiful 2020 babies. 

According to taxadviser.com, you need to file a tax return to get the stimulus as a refund recovery credit. The IRS says the credit will be added to any refund or reduce any taxes due on your 2020 Individual Income Tax Return. You can read more about that here.

Some people are asking if they will receive their second stimulus payment on an Economic Impact Payment or EIP card. 

According to the IRS, EIP Cards are direct debit cards that were mailed to some taxpayers; the original debit cards will not be “reloaded.” There will be new EIP Cards for some individuals. If you received an EIP Card for EIP 1, it does not mean you will receive an EIP Card for EIP 2. People not receiving a direct deposit should carefully watch their mail – either for a paper check or an EIP Card.

Some people are asking how the IRS will know where to send a payment, particularly those people who changed bank accounts. According to its website, the IRS will use the data already in its system. Taxpayers with direct deposit information on file will receive the payment that way. For those without current direct deposit information on file, they will receive the payment as a check or debit card in the mail. 

For those eligible to receive a payment but who don’t for any reason, the money can be claimed by filing a 2020 tax return in 2021. The IRS says it's important to remember the Economic Impact Payments are an advance payment of what will be called the Recovery Rebate Credit on the 2020 Form 1040 or Form 1040-SR.

You can check the status of your second stimulus by following this link.

Eshleman says it's best people spend their stimulus where it's most important -- bills, rent, etc. For those who do not need the extra cash, Eshleman recommends giving it back to a nonprofit organization, leaving a bigger tip for a waiter or waitress, or saving it. 

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