Tax Clinic Helps Single Moms and Kids Get Child Tax Credit and CARES Act Funds Wrongly Paid to Abusive Former Partners

Maureen* is the single mom of three children ages six and younger. After several years in an abusive relationship with her children’s father, she is working to move forward and create a new future for herself and her kids.

For many people like Maureen, the Economic Impact Payments (stimulus funds) provided through the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and the increased Child Tax Credit during the pandemic were a financial lifeline. But Maureen never received those funds for her children. Her children’s father wrongfully claimed their children as dependents on his income taxes in 2019 and 2020 and received the payments that should have gone to Maureen. This happened even though she had full custody and was receiving almost no support from him.

That meant $12,600 ($5,100 in Advance Child Tax Credit Payments plus $7,500 across three rounds of stimulus payments for her children) had gone to her partner rather than to her to help pay for food, clothes, and other things she and her three kids needed.

A Race to File 2021 Tax Returns

Enter Jon-Yin Mills Chong, an accountant in LSC’s Tax Clinic. With the 2021 tax season approaching, an immediate priority was for Maureen to get her taxes filed electronically on January 24 – the first day individuals can file electronic returns to the IRS through the internet.

“The individual who is the first to file their tax return electronically and claim the children as dependents will receive the portion of the Child Tax Credit that was not paid in monthly installments between July and December of 2021 as part of Covid relief legislation,” explains Chong.

“While filing first does not control the final outcome, it prevents the second taxpayer from filing electronically and generally sends the second taxpayer on a lengthy trip through the IRS audit process and potentially Tax Court litigation in order to establish the right to claim the children and the related credits,” notes Keith Fogg, Clinical Professor of Law and Director of LSC’s Tax Clinic. “This could postpone the timing of the payments by several years. Maureen might eventually receive all of the credits for 2019 and 2020 and the father may eventually owe the money back that he received for those years, but the process for Maureen will be long and slow if he files first. It is also a process that is difficult to navigate if you don’t have representation.”

For Maureen, filing her 2021 taxes first would mean that $5,100 in Child Tax Credit payments would go to her and the kids now. Filing first would also allow Maureen to secure the $5,100 she missed in monthly installment Child Tax Credit payments and the $4,200 she missed from the third round of stimulus payments for her children in 2021.

For 2021, the Child Tax Credit had been increased from up to $2,000 per child to up to $3,600 per child under age 6 and $3,000 per child from ages 6 to 17. Individuals who filed income taxes for 2020 and claimed a child or children as dependents received half of that total payout per child in monthly installments between July and December. So Maureen’s partner had already received $5,100 under the Child Tax Credit that was rightfully hers for 2021.

“Our mission was to electronically file first, so she could get the money now, rather than having the burden be placed on her to contest matters with the IRS for months or even years,” says Chong.

The Tax Clinic at LSC normally does not do tax returns. But the close relationship between the Tax Clinic and LSC’s Family Law Clinic, Casa Myrna Vasquez, a Boston nonprofit providing services to survivors of domestic violence and their children, and the Asian Task Force Against Domestic Violence resulted in Chong and two undergraduate interns —Eshika Kaul of Wellesley College and Shery Girgis of Vanderbilt University—racing to file tax returns for almost 20 single mothers, using tax software generously loaned to the clinic by the Boston Tax Help Coalition. Their goal: to be first.

Unique Times Call for Extra Efforts

“The unique circumstances during Covid, and the sizeable amount of money available for these individuals and their kids made it the right thing for us to do,” says Chong. “It was an extremely stressful time, but all told, we successfully filed returns for 19 single parents, claiming over $160,000 for them.”

Focus on Back Stimulus Payments Next

In some cases former partners had also collected the women’s and/or their children’s individual stimulus payments over the previous two years during Covid. “We’ve lost filing races twice this season,” says Chong. “For one of these clients it will take at least six months and navigation of an onerous IRS process for her to receive the more than $20,000 she’s due.”

In Maureen’s case, she did receive her own stimulus payments by filing returns without her dependents. But she has yet to receive $3,300 in stimulus payments for her kids: a first round stimulus payment of $500 for each child and a second payment of $600 for each child. The first two stimulus payments constitute a tax credit on the 2020 tax return. To receive these payment Maureen will need to file an amended 2020 tax return.

Chong and the Tax Clinic will now file paper prior year tax returns with the IRS on behalf of Maureen and others to obtain the first two stimulus payments for their children.

Maureen is hoping the funds the Clinic is helping her obtain “will enable us to have a place of our own and be able to make ends meet,” she says.

“Someone like Maureen would be missing out on thousands of dollars in help for herself and her three kids unless we provide assistance,” says Chong, who was recently accepted to Harvard Law School. “We’ve gotten some of the money for her and others by filing 2021 returns quickly in January. It’s going to be a lengthy process to get the rest, but we believe we will succeed.”

*Client name has been changed to protect client privacy.

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