Claiming a Child
When you’re separated or divorced, it’s not always clear who gets to claim a child as a dependent. As of January, 1, 2019, the personal to claim a child has been eliminated in favor of a higher standard deduction. So, claiming a child as a dependent will no longer give you an exemption to reduce your taxable income. Still, you can receive other tax breaks, including child or dependent tax credits, the Earned Income Credit, and a more favorable filing status, when you claim a child.
Custodial Parent and Noncustodial Parent
It’s common for the custodial parent – the parent who has the child more than half the year with – to claim the child as a dependent. The noncustodial parent may be available to claim the child if he or she provided more than half of the child’s support in a given year.
If there’s any doubt about who will be entitled to the benefit, it’s best to communicate with the other parent before you both file your tax forms. When both parents trying to claim the child, only the first who filed their return will be accepted.
The noncustodial parent may also claim the child as a dependent if the parents have an agreement to do so. This agreement is often found in divorce papers, a separation agreement, or a written declaration which states which parent is entitled to claim the child.
If no divorce or separation agreement states who will be entitled to claim the child, then you must rely on the actual custody arrangement. That is, the parent who spends the most time is entitled to this benefit. If the child spends equal time between both parents, then the parent with the highest adjusted gross income may the one to claim the dependent. If only one of the taxpayers is the child’s parent, that parent may claim the dependent.
Release and Revocation
If you have no divorce or separation agreement, the custodial parent – the parent who spends the most time with the child – can sign IRS tax form 8332 or a written declaration to release their dependency claim. The custodial parent has the right to revoke IRS tax form 8332 or their written declaration at any time and reclaim the child as a dependent. In short, add IRS tax form 8332 to your return when you claim a child that the other parent has released, or to revoke your prior release of the child as a dependent.
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