It looks like your fiancé did something wrong. Since you said you've been with him for 8 years, and your daughter is 9 years old, I assume that your fiancé is not the child's father. If the child is not related to him, he cannot claim her as a dependent if the child is a "qualifying child" of anyone else. Assuming your daughter lived with you, she is a qualifying child to you. Therefore your fiancé cannot claim her as a dependent. Those are the rules. Your giving him permission doesn't change the rules. She's still your qualifying child, so he can't claim her. There is no provision in the tax law for a parent to give an unrelated person permission to claim a child as a dependent.
No there was a question on the site that stated if not biological child do you have permission.
You must have misunderstood the question. There is one case that a non-related child can be claimed and that would be you were not required to file a tax return at all. If you were required to file then the child would be your qualifying child and cannot be claimed by any non-related person even if all the other requirements are met.
See IRS Pub 17 "Qualifying relative". The first test that must be met is "Not Qualifying Child".
<a rel="nofollow" target="_blank" href="https://www.irs.gov/publications/p17/ch03.html#en_US_2016_publink1000170933">https://www.irs.gov/publications/p17/ch03.html#en_US_2016_publink1000170933</a>
There are several examples including:
"Child of person not required to file a return. A child isn't the qualifying child of any other taxpayer and so may qualify as your qualifying relative if the child's parent (or other person for whom the child is defined as a qualifying child) isn't required to file an income tax return and either:
- Doesn't file an income tax return, or
- Files a return only to get a refund of income tax withheld or estimated tax paid."