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Stimulus checks and child support: What to know about a new payment and the last one

Duplicate payments, garnishment and more, plus how to get a make-up payment for the second check and what could happen with a third.

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The rules changed with a second check, but what about a third payment?

Angela Lang/CNET

The first and second stimulus checks have come and gone, and a third payment may well be ahead. There's a lot to know in this in-between space, including the current situation with stimulus check money that might or might not be garnished if one party owes child support. There's also a loophole in the law that could help you, and another that could hurt you -- plus some possible changes coming to dependent status for a third stimulus check, if it's approved as part of a COVID-19 package as soon as next month.

Also, if you're one of the parents who didn't receive the money, you may still be able to get it, you'll just have to wait until you file taxes before your catch-up payment is settled. Keep reading for the full explanation.

One thing that didn't change in the eligibility rules for the second stimulus check is the definition of a child dependent as 16 years old or under (this could change with the next stimulus check). However, the December bill authorized payments of $600 for each child as part of the household's total, $100 more than the first round of checks. So, how could it happen that you and your child's other parent both get money for the same kid, and what if you didn't get as much as you think you should? We'll explain. This story was updated with new information.

What will the child support situation be for a third stimulus check?

While it's too soon to say what will definitely happen, the latest proposal for a stimulus package (PDF) does specifically call out child support, at least in terms of garnishment. As with the second stimulus payment, terms for a third stimulus check could potentially look like this:

Advance payments are generally not subject to administrative offset for past due federal or state debts, including offset for past-due child support.

That means people who owe child support would still be able to get their full stimulus payment the terms were adopted into law -- but possibly only on advance payments. In other words, a stimulus check, direct deposit or EIP card automatically sent by the IRS. An example of something that isn't an advance payment would be claiming missing money as part of a Recovery Rebate Credit. Note that the final bill language would be expected to go into grater detail.

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How a change proposed for dependent status could affect the next stimulus payment

The third stimulus check could make dependents of all ages count toward the family total, for a $1,400 apiece. For the subset of families with children who are 17 (or 18, but living at home and still in high school, depending on your local rules), a move to accept dependents of all ages could benefit families that qualify, including those in child support scenarios.

How other qualification changes might affect your stimulus check

Ultimately, your situation could change between the second check and the third, including your eligibility. There's talk of making the next stimulus payment "targeted," with the end result of fewer people qualifying overall. The latest proposal suggests a sharp income cutoff, so that if you make above a certain amount -- say, $150,000 as a head of household, you wouldn't be eligible for any stimulus check money in the third round, even if you have multiple dependents.

How can both parents get stimulus money with joint custody?

Many parents who aren't married and share joint custody of their children actually received two payments for the same child during the first round of stimulus checks, if they alternated claiming those children on their taxes every other year. 

Basically, if one parent claimed a child in even years and the other in odd years, both could've gotten checks for the same child. That's because the IRS looked at two different tax years -- 2018 and 2019 -- to determine eligibility for the first check. 

For the second stimulus check, the IRS only looked to 2019 tax returns, but that doesn't mean the double-dipping loophole has been closed entirely. If you're a parent in a joint custody scenario like the one above and you typically claim a dependent child in odd-numbered tax years, you may be able to get a duplicate $600 child dependent payment as a tax credit when you file and claim the child on your 2019 tax return, similar to what you'd do if you did not receive a second stimulus check despite being eligible for one.

The second stimulus check blocks garnishment of overdue child support, but the IRS may still be able to redirect your payment

Unlike the CARES Act, which made it legal for states to garnish the first stimulus check for people who owed more than $150 in arrears, a rule for the second check indicates that parents can keep the entirety of their payment even if they owe child support. In fact, the latest bill prohibits seizing stimulus payments the IRS sent out by Jan. 15 for most kinds of debt, including from private creditors and banks.

However, if you have not received all or part of a payment yet from the IRS and intend to claim it when you file your taxes this year, the IRS can redirect that payment to cover past-due child support, unpaid student loans and other federal and state liabilities. The IRS said it's aware of the loophole and is "looking into this issue."

The garnishment rule change is a big deal for this reason, too

When the first stimulus checks were garnished to pay past-due child support, sometimes clerical errors also took stimulus money allocated to a (new) spouse who was not the child's other parent. Stopping all seizures of stimulus check money means that these individuals would not have to reclaim their full second stimulus check funds with the IRS. Here's how they'll need to claim money mistakenly garnished from their first payment.

For more stimulus check details, here's how to calculate your second stimulus check total and here's what we know now about a third stimulus check for up to $1,400 per person.