It is not uncommon for a divorced parent to wonder if he or she can claim his or her child as a dependent on his or her tax returns. Being able to claim a child as a dependent can help a lot at tax time: each dependent means a deduction of $4,050 on the filer’s tax return, reducing his or her taxable income amount. In some cases, parents can receive a Child Tax Credit, which is a $1,000 credit for each child under the age of 17.
When a couple divorces, they lose the ability to file their taxes jointly. This eliminates the possibility of applying the benefits of claiming a child as a dependent to their joint tax return and forces them to decide which parent can claim the child as a dependent.
Only One Parent May Claim the Child as a Dependent
Both parents cannot claim the child as a dependent on their tax returns. You and your spouse can decide which parent will claim your child as a dependent on future tax returns in your divorce settlement. When parents do not do this, the child’s custodial parent is automatically granted the right to claim the child as a dependent on his or her taxes. Even if the parents have joint custody of their child, the parent who has the child more than 50 percent of the time is the one who can claim him or her as a dependent. In situations where parents truly have equal time with the child, the parent with the higher adjusted gross income may claim the child as a dependent.
Changing Which Parent Claims the Child
For some parents, having the noncustodial or lower-earning parent claim their child as a dependent is the most effective course of action. For other families, parents alternate claiming their child each year, allowing both to receive the benefits of claiming the child as a dependent on their taxes at various points. In these situations, the parents must sign Form 8332. This enables the custodial parent to release his or her right to claim the child as a dependent to the other parent for one year or longer. Both parents must include a copy of this form with their tax return when the noncustodial or lower-earning parent claims the child. The parent who typically has the right to claim the child as a dependent can revoke the permission granted by this form at any time.
Work with an Experienced Winter Park Divorce Lawyer
To learn more about the nuances of filing your taxes during and after your divorce, speak with an experienced divorce lawyer. Contact Aubrey Law today to set up your initial consultation in our office. During your consultation, we can answer your questions to help you make productive decisions about your divorce and life as a divorced parent in the years that follow.