Stimulus Payment for Divorced Couple with kids?

Question

Asking for a friend:

Couple was married filing jointly with 4 children through 2019. Divorced in early 2020, court says all 4 children live full time with Mom and she gets to claim them on taxes (actual living situation matches court order). She filed her 2020 return as early as possible as head of household with all 4 kids as dependent. It was accepted on Feb 12th and still shows as processing on "Where's my Refund" - This return has her new address and bank account on it.In the divorce, she took her name off their joint bank accounts but ex-husband kept the account open in his name only. Both the December stimulus for $600/person and new stimulus for $1400/person went to that (formerly) joint bank account and the ex-husband has pocketed the money and she hasn't seen a dime.

1. On her 2020 return she claimed $3000 for the recovery rebate credit since she never got any of the "advanced payment" money. Will the IRS approve that claim or are they going to subtract that from her refund because they already sent it (to a bank account that she no longer has access to)?

2. The payment locator tool for the $1400 stimulus says her money was sent to that old account yesterday. When the IRS processes her 2020 refund will they see the updated account and send the stimulus to her new account? if not will she be able to claim the funds on her 2021 tax return next year?

Anonymous · Accepted Answer

If the stimulus checks were based on jointly filed tax returns, then the IRS will consider the division of the money a civil matter.  That is, she would have to take him to court.

BTW, she also didn't follow the instructions when she filed her 2020 return if she put $0.  
"Married filing jointly.
• If your EIP 1 or EIP 2 was based
on a joint return, you and your spouse
are each treated as having received half
the payment that was issued."

Slickterp · Answer

1.  They are going to have an issue, because they already paid the money.
2.  They will not send a new third stimulus, again, they already paid it.
She needs to take her ex to court.

Amy · Answer

1. They are going to reject the credit because they already sent the money to her last known bank account. This fraudulent claim is why her return is still processing.

2. Because the 2020 return is still processing, they don't have her new bank account number on record. The latest stimulus was again sent to her last known bank account. If she filed MFS for 2019 the payment has only her name on it, in which case there's a chance it might get rejected by the bank and the IRS will send a paper check.

Stimulus Payment for Divorced Couple with kids?

3 Answers