Child Custody Tax Issues: Who Claims a Child on Taxes?

A parent meeting the age test, relationship test, support test, and dependent test claims the child tax credit using IRS Form 8332. Under the residency test, the custodial parent with the majority of nights spent with the qualifying child claims the credit. For joint custody, the IRS tiebreaker goes to the parent with the higher Adjusted Gross Income (AGI). Parents can sign a written waiver in the divorce decree or separation agreement for the noncustodial parent to claim the credit. Depending on tax filing status, parents can also claim the earned income credit and the dependent care credit.

For legal help with child custody and tax issues, contact an experienced child custody lawyer in your area.

Filing Taxes as a Divorced Parent

Typically, when parents are divorced, only one gets to claim the child as a dependent on their annual tax return. An exception exists for divorced parents that are still filing jointly, though this is uncommon. So, for divorced parents that file separately, who gets to claim minor children?

For Parents That Have a Joint Custody Agreement

In most joint custody agreements, there is one parent that generally handles the day-to-day care and well-being of the child. In instances where there is a known custodial parent whom the child spends more time with, the parent can claim the child as a dependent. However, the custodial parent can relinquish the tax credit to the non-custodial parent by filing IRS Form 8332 – Release/Revocation of Release of Claim.

Parents in a joint custody arrangement can also share the tax credit if they so choose.

For Parents That Have a 50/50 Custody Agreement

Suppose that both parents divide time and caretaking of their minor children equally. If there is no true custodial parent, the IRS allows the parent with the highest adjusted gross income to claim the child tax credit.

What If the Non-Custodial Parent Claims Their Children?

Unless they have the permission of the custodial parent, the non-custodial parent should not claim the child as a dependent for their tax year. This can invite raised scrutiny and potential audits from the IRS. Still, there are certain circumstances where the IRS might grant the non-custodial parent’s claim:

• As stated above, when the custodial parent files an IRS Form 8332 with their tax return
• When the non-custodial parent serves as the primary caregiver for part of the year
• When the child has lived abroad with other family members for part of the year

If the non-custodial parent insists on claiming the child as a dependent, consider seeking the legal advice of a family law attorney. It might also be good to speak with a tax professional. They know the ins and outs of IRS rules and tax laws and can inform you of proper filing status regardless of your spouse’s intent.

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Questions to Ask a Child Custody Attorney

Speaking to a child custody attorney for the first time can often be intimidating, especially because family law tends to dredge up emotions. Before sitting down with an attorney, consider which questions you’d like to ask them and what answers your ideal attorney might provide. Here are a few examples to help get you started:

• Can I claim my child on my annual federal tax return if I divide parenting time 50/50 with my former spouse?
• Am I entitled to child support?
• Should I speak with an income tax professional?
• Can I get a restraining order against my spouse if they endanger my and my children’s well-being?
• How can I file for sole legal custody arrangement of my minor children?
• Do I need an attorney if my former spouse and I seek joint custody?

Searching For the Right Family Law Attorney

When child custody disputes arise, it is best to enlist legal representation.

A complicated and emotionally taxing process can be made easier with the benefit of a lawyer by your side. A family law attorney from an accomplished law firm can provide essential legal advice on marital assets, child custody, and restraining orders, all while guiding you through the nuances of family court.

Search the Super Lawyers database for a custody and visitation attorney operating in your current jurisdiction.