Stimulus Money and Kids- Who Gets the Money

I have two adult children. One has developmental delays and still lives at home. That one has just started working this year. He doesn’t make much but he is making slow and steady progress toward an independent adulthood. The other lives independently.

Three of us got the previous stimulus awards. For some reason my child that lives at home never did get the $600 or $1200 . We think he never got those payments because, unlike his sitter, he had never worked before. We tried to get the payments for him but were unsuccessful. The kid living independently received both of the previous payments into her bank account.

This most recent payment came to my bank account. The amount was $4,200.

I told my husband that the money had arrived and transferred $2,100 to his account. A few days later I realized that we had actually received three $1,400 payments. That seems to be three $1,400 payments.

I checked with my child that lives independently and she had received $1,400 so the money wasn’t intended for her.

I told my husband that I think we made a mistake. I think we both received $1,400 and that there was a third $1,400 payment that I think is intended for our son. I suggested we both transfer $700 to my son’s bank account and we did that and told him “Congrats!”.

When I talked about this at work I was surprised at how many folks there also received money intended for kids )of all ages) but don’t plan to move the money along to the intended recipient.

Most said “I’ve supported this kid since birth. They own me., Plus, they’ll just spend it,” or some variation of that.

I said “I disagree. It’s stimulus money. You’re supposed to spend it. And it’s immoral, unethical, and wrong to keep money that doesn’t belong to you.”

But that doesn’t seem fair either.

I mean, if you kid is 3 years old, or 10 years old, fine. Keep the money. Or put it in their bank account (if they have one). Or spend it like it is intended. Or maybe give them a bonus/award to buy something special.

But if your kid is I dunno- 17 or older, I don’t feel like you can reasonably keep the money.

I think you risk potentially damaging your relationship with that/those kid(s) for a lifetime if you keep money intended for them. I don’t think $1,400 is worth a lifetime of damage and mistrust.

How are SDers handling this? Thoughts?

I’m not under the impression that people under 18 receive it. Their parents get some sort of extra added on. I would say that money does belong to the parent (though it is intended to be used for the child).

But people 18 or older definitely deserve the money, and it’s wrong to keep it. For the first two payments, I got them added to my disability account. This last one, though, went to my dad. We do share a bank account for complicated reasons, but he got it in the account that is just his. It’s weird, and I’m not surprised that this is happening elsewhere.

The fact they gave your son the money suggests he was, like me, always intended to get the money from the other ones. I’ve read that the recourse if you don’t get said money is to just file taxes, even if you report no income, and say that you were eligible but did not receive the money. Is that the method you tried?

As for the morality: of course the money belongs to the adult. Only if their guardians are handling their finances does it make sense to keep it, but then they should be using it for their dependent, not for themselves. Let them know about the money and they can come up with things to buy.

I think if your child is a dependent and you get the stimulus money, then it’s yours legally. Regardless of the child’s age. If you want to give it to your son, great, but I don’t think that anyone else is obligated to. The purpose of the dependent status is to indicate that someone is financially reliant on someone else, so it makes sense that tax kickbacks go to the person who handles the money.

Morally, I think you can make an ok case either way. If you are providing substantial financial support to your son then that is what the stimulus check is for.

I don’t pass along the Child Tax Credit to my kids either.

Except that it isn’t stimulus money. It’s relief money. It is explicitly designed to give financial aid to people who have lost money or income due to Covid-related situations. If that doesn’t apply to you, there is no sort of obligation to spend it. As a matter of fact, I would be inclined to argue that donating the money to charity is a far more ethical act than spending just for the sake of spending.

That makes sense. Thanks!

I don’t understand your moral quandary with this. The tax system–when it does credits, rebates, relief money, etc.-- tries to put money in the hands of those who need it and gives money to that person.

You have, in essence, told the federal government that your adult child depends on you and your husband for support and is not independent. The government recognizes that as you and your husband are the ones supporting the adult child, then you need the money much more than he/she does. This is to help you to a greater extent than someone like me with your additional expenses of supporting an adult, when I have no such expenses.

Really, this is no different than in any other tax year where you claim a deduction for the adult child. Do you feel that you should give that child the difference in taxes you paid versus what you would have paid without claiming the child?

Just because someone lives with you and you take care of them doesn’t mean they are unable to handle money, and need someone else to make all financial decisions for you.

I would argue that, with adult dependents, the goal is to have them manage as much as they are able. If you are still handling their finances completely, then it makes sense to keep the money (though you’d better still use it on them, and not jsut use it for yourself.) But if they are handling money, then it makes sense that they be able to handle what is their money.

Either way, that’s what it is. The money belongs to the adult child. The child credit belongs to the parent. That’s a fundamental difference as far as I’m concerned.

I would object if my dad didn’t give me the money that incorrectly went to his account instead of mine. Granted, my disability isn’t to the level of being a dependent of my father, but I expect that any other adult who can manage their own money would feel similarly.

I think the OP is doing the exact right thing in giving him the amount of money she thinks he can handle. It sounds like she gave him half of it and held back the rest.

But it’s relief, not stimulus. If the adult child buys all their own groceries and pays a fair rent, then they aren’t a dependent. Dependent means you’re paying for their expenses. If during COVID you saw a loss of income, that means paying for your adult child’s expenses became a new burden on you. If while unemployed I depleted my savings or ran up my credit card to pay for food or medical care or whatever for my adult child, I wouldn’t feel it inappropriate to use the relief money to replace those funds.

If I didn’t lose income during COVID, I would likely turn the money over.

Looking at my check, they’re technically “Economic Impact Payments”, not stimulus checks or relief payments. To me, this seems vague enough to go both ways, and that correlates with the distribution method of paying nearly everyone who got the more specific stimulus checks in the first two rounds.

I think that whether you give it to your kid or not should be dependent on the degree that they’re dependent on you. Maybe not a pro-rated distribution, but I see no reason that a college student being claimed as a dependent and whose tuition, room & board is largely paid by their parents should actually get the stimulus check. However an adult student who’s paying rent to their parents and just kept as a dependent for insurance purposes should probably get the check.

That’s not what “dependent” generally means under the I.R.S. Code. Someone is your dependent if you are providing a majority of their financial support.

It’s not about who “handles” the cash or manages the checking account, it’s based on who is providing financial support. So if an adult dependent is claimed on a parent’s tax return, the parent correctly receives the payment.

I knew a guy a few years back, who was a Native Canadian. He learned that his mother had been keeping years worth of payments from the Band council that were supposed to be for him, but that he’d never known about. It wasn’t much, maybe $1000/year, but he could have used that money, and he was really angry when he found out.

Nobody said that they are “unable to handle money.” It is just a point of fact that the taxpayer has essentially said, “Hey, government, I pay the majority of expenses for this adult right here” so when determining who gets a previously unheard of benefit, the government then says, okay, you need the money to support that adult more than the adult himself or herself needs it. It’s a simple policy choice.

Again, are you upset that it normal years, the taxpayer gets a larger deduction for having a dependent adult in the house? Should the government take that extra money and send it to the dependent adult?