Tax Dep., Filing Status, Child Care expenses, Tax Credit

[kmich91262]

Since your wife has nothing to gain by trying to claim that two children spent the majority of nights with her, I don't know why she would throw a wrench into the works.

If you can't trust your wife, then keep a detailed log of every night the kids are with you and don't claim HoH unless one of the children really was with you a majority of nights for a given tax year.

Sorry don't mean to truncate your reply Groundhog. I agree that as long as both people can get along fine (and the key words are get along), then the IRS doesn't have anything to stand on. However the bigger issue is what happens if one them gets p-ssed off at the other and claims both children for HoH? Unfortuantely if a person doesn't have good documentation, one is scr-wed out of the HoH. So I think you are spot on Groundhog by stating keeping a detailed log.

I would also suggest that if it is written into the order that each person gets to claim a child for HoH purposes, not figuring that into your paycheck for tax purposes, but taking it when the return is filed for the year. This way one if the other gets a burr up you no where by claiming HoH on both kids, you aren't out money right away, and can let the IRS sort it out. Hope that makes sense.

[grgr]

In order to claim HH you must have paid more than half the cost of maintaining your home for a dependent for more than half of the year. The court order cannot mandate who gets to claim HH, but of course it can mandate how many overnights per year for each child. The IRS makes an exception to the rules pertaining to divorced/separated parents claiming dependents but they do not make an exception for claiming HH - divorced/separated parents must meet the same qualifications as anyone else.

I would always keep documentation of overnights, especially if your ex is named as custodial parent. In the absence of any documentation to the contrary, the court order naming the custodial parent will be the documentation.

Since your wife has nothing to gain by trying to claim that two children spent the majority of nights with her, I don't know why she would throw a wrench into the works.

Your wife/ex most definitely could have something to gain. Only the parent having the greater number of overnights can claim the EIC and Child Care Credit. Those credits could amount to alot extra money and would be reason enough for the ex to throw a monkey wrench into the works even if she isn't normally inclined to do so just for the sport of it.

[MarylandDadom]

Thank you everyone for the responses....I think I have my head around what is permissible and the risks associated with the wife/ex. However, I am still not clear on one thing......

Even if I can demonstrate to the IRS that both parents properly claimed HOH....I don't want them knocking on my door. Does anyone know if having both parents claim one child each and then each filing HOH increases the risk of audit? Would it be beneficial to include language in the seperation agreement that demonstrates that each child will spend 183+ nights with the claiming parent....then include this with the returns? Or perhaps send a notarized statement signed by both parents in each return detailing the number of night each child stayed with each parent along with the returns.

I am confident at this point that we can both properly claim HOH, I just dont want the IRS knocking on my door.....even if I can prove Im right, the headache and hassles of dealing with them is something that I dont want.

[spritom]

Even if I can demonstrate to the IRS that both parents properly claimed HOH....I don't want them knocking on my door. Does anyone know if having both parents claim one child each and then each filing HOH increases the risk of audit? Would it be beneficial to include language in the seperation agreement that demonstrates that each child will spend 183+ nights with the claiming parent....then include this with the returns? Or perhaps send a notarized statement signed by both parents in each return detailing the number of night each child stayed with each parent along with the returns.

I am confident at this point that we can both properly claim HOH, I just dont want the IRS knocking on my door.....even if I can prove Im right, the headache and hassles of dealing with them is something that I dont want.

As mentioned, filing HOH has much more tax advantage than the $1,000 credit.

The documentation the IRS cares about is Form 8332. You would sign one 8332 to her for one child, and she would give you a signed 8332 for the other child. With this form, then the whole thing about counting overnights, the other parent getting upset sometime in the future, and more doesn't matter anymore. Some people are able to negotiate this out directly with each other, other times parents take the Form 8332 issue to court and ask the court to order the other parent to provide it.

The documentation is not needed for the initial filing and is kept (somewhere safe) as supporting documentation in the case the IRS wants to follow up with you. The form doesn't state it has to be notarized, but in case the other parent tries to claim otherwise, the form could be notarized.

Side-note:
Only if you had a family court order dated before 1/1/09 would the IRS be interested in the other documentation you mentioned. But if there's no court order or if the court order is dated 1/1/09 or later...then it's all about the Form 8332.

Further reading:
If the active court order is dated 1/1/85 - 12/31/08
http://www.irs.gov/publications/p17/ch0 ... 1000170897

Court orders signed 1/1/09-currently or not signed:
http://www.irs.gov/publications/p17/ch0 ... 1000170902


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[edit]

Amending this posting as my information above is incorrect (as everybody already showed). Even the items I was looking at had a tiny little prepositional phrase that stated for the exemption only and would not be for the filing status (yeah...as everybody said).

[kmich91262]

Just so there is no confusing the OP, the form 8332 doesn't apply to HoH but it does apply to claiming a child in any given year. You could have majority of the overnights in a calendar year however if it isn't your year to claim them per the court order you don't get too however they can be claimed for HoH purposes (if one meets all of the IRS quals).

[Captain Trips]

You could have majority of the overnights in a calendar year however if it isn't your year to claim them per the court order you don't get too

Not to add more confusion to the issue, but we should clarify. If the child is your qualifying child for the purposes of the dependency expemption, meaning you pass all the tests as far as support and such, you get to claim the child as a dependent. It doesn't matter to the IRS what your divorce decree says about who gets which child which year.

In the case of divorced parents, the IRS will allow one parent to give the dependency exemption for a qualifying child to the other parent, but they won't force you to do it.

You may find yourself in a contempt action if you claim a child in a year that your decree says you shouldn't, but I would think that would be hard to argue.

[kmich91262]

You could have majority of the overnights in a calendar year however if it isn't your year to claim them per the court order you don't get too

Not to add more confusion to the issue, but we should clarify. If the child is your qualifying child for the purposes of the dependency expemption, meaning you pass all the tests as far as support and such, you get to claim the child as a dependent. It doesn't matter to the IRS what your divorce decree says about who gets which child which year.

In the case of divorced parents, the IRS will allow one parent to give the dependency exemption for a qualifying child to the other parent, but they won't force you to do it.

You may find yourself in a contempt action if you claim a child in a year that your decree says you shouldn't, but I would think that would be hard to argue.

My point Captain was that the form 8332 has nothing to do with HoH. All the 8332 does is it gives the other parent the right to claim a dependency exemption for certain years regardless of the number of overnights a parent may have the child in a given calendar year. Yes, it could be outside the parameters as allowed in the court order, however that would be up to the other parent that is giving to do so (which I may add from my understanding an 8332 that gives future exemptions can be voided at any given time by the giving parent). All I was saying is that I didn't want the OP to be confused that the 8332 is also for HoH...has nothing to do with HoH.

As far as simply claiming a child against what the decree says, I would think that is playing with fire regardless what a person could argue. Take it for what it is worth, however the IRS allows exemptions to be determined in a court order but not HoH. With that being said, IMO I would think a judge would be quite furious to find out one was willfully in contempt of the order just because they had a good argument to do so. However somebody with more experience maybe can chime in.

[spritom]

My point Captain was that the form 8332 has nothing to do with HoH.

I'm having a different read of the IRS policy. 8332 provides for resolving one of the OP's ingredients for HOH.

And if I understand the OP's dilemma, one of two missing ingredients to the situation of the thread was having a qualifying person in order to meet HOH.

* One ingredient to claiming HOH involves having a qualifying person.
* Usually this means the qualifying person is living with you.
* However, if the qualifying person is your dependent, then they don't actually have to live with you.
* Claiming as a dependent usually involves having them live with you more than half the year (along with other criteria such as the dependent not providing for half of their own support, etc.)
* Form 8332 allows for bypassing the dependent "living with you" portion

The IRS has stated that it no longer reads family court orders dated 1/1/09 or later and reads 8332's or signed documents similar to the 8332.

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However, to bring back the OP's other ingredient of still being married on Dec. 31, 2011...I don't think HOH applies to the tax filing for TY2011 as only the options of Married Filing Joingtly or Married Filing Separately would apply.


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[edit]

Amending this posting as my information above is incorrect (as everybody already showed). Even the items I was looking at had a tiny little prepositional phrase that stated for the exemption only and would not be for the filing status (yeah...as everybody said).

[hoosier_dad]

I'm having a different read of the IRS policy. 8332 provides for resolving one of the OP's ingredients for HOH.

Not sure I get this reasoning since the existence and filing of a form 8332 is a giant red flag to the IRS that you are not able to claim HOH for that child. The fact that you needed a form 8332 means that you did not meet the IRS requirements of custodial parent for that child, so you don't qualify for HOH.

[kmich91262]

I'm having a different read of the IRS policy. 8332 provides for resolving one of the OP's ingredients for HOH.

Not sure I get this reasoning since the existence and filing of a form 8332 is a giant red flag to the IRS that you are not able to claim HOH for that child. The fact that you needed a form 8332 means that you did not meet the IRS requirements of custodial parent for that child, so you don't qualify for HOH.

Again my understanding of the 8332 is so that one can claim a child for an exemption. Grgr might chime in more but this is my understanding of reading the IRS Pub 501. The 8332 is just for the exemption only. It doesn't mean one way or the other if a person can file using HoH however it does mean one can claim a child/ren for exemption. Maybe I'm misreading the reply...sorry a little tired and stressed out with what is going on in my life currently.