Beginning in the summer of 2020, the Federal Government made a series of three (3) stimulus payments to the American public to assist with the financial burdens of the COVID-19 global pandemic. Based on each tax filer’s 2019 Federal Income Tax return, the IRS paid out a specific dollar amount for each adult and qualifying child in a respective household.
However, an issue arose divorced parents share custody and alternate tax years in claiming the minor child(ren) on their individual Federal Income Tax returns because only the parent that claimed the child(ren) on their 2019 tax return received the stimulus payment for the child(ren).
Many parents are now asking if the stimulus payments received for the child(ren) must be shared equally between each parent. There is no short or simple answer to this question. The answer turns on several factors, which include but are not limited to, the designation of physical custody a parent has pursuant to their decree of divorce, how the Orders of the Court in your individual case resolve the issue of claiming minor children on individual Federal Income Tax Returns, and the judge which you appear in front of to resolve the issues of your case.
If you have sole and/or primary physical custody of the minor child(ren) and solely claim them on your individual Federal Income Tax return every year, the stimulus money would most likely be awarded to that parent solely. The other parent would have trouble making an argument to their respective Judge as to why it would be appropriate to equally share monies earmarked for the children when that parent does not enjoy as much parenting time with the children.
If you have primary custody of the child(ren) but you alternate claiming the child(ren) on your tax returns for whatever reason, the stimulus money is probably still yours as long as you are the primary custodian of the child(ren). The non-custodial parent would have to provide proof of a need for the stimulus that would benefit the child(ren) before the court would order it be shared or split between each of the parents.
If you have joint custody of the child(ren) and alternate claiming the child(ren) on your tax returns, the stimulus money would likely be equally shared between the parents. This is especially true if both parents have similar incomes. Both have a need for the stimulus and receiving an equal share would benefit the child(ren). However, if one parent earns substantially more income than the other parent, the court may consider an unequal distribution of the stimulus to the parent with the greater need.