If you
and the other parent live together, either one of you (but not both) may claim
the child. You may decide between you which one will claim the child. Only if
you can’t agree, do the IRS tie breaker rules apply, to see who has first
choice. It may be worthwhile to prepare trial returns, both ways, to see which way the family comes out best.
This tool may be useful: https://turbotax.intuit.com/tax-tools/calculators/taxcaster/?s=1.
If you
and the other parent live together, only one of you can claim the child for any
tax benefit. The interview is confusing (it's designed for divorced parents,
who are allowed to split the child). The
second parent should not enter the child, at all.
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On the other hand, if you are the custodial
parent, you should be aware that the
custodial parent has first priority on claiming the children on her taxes;
regardless of the amount of support provided by the non-custodial parent. The IRS goes by physical custody, not legal custody. The
non-custodial parent can only claim the child as a dependent if the custodial
parent gives permission (on form 8332) or if it's spelled out in a pre 2009
divorce decree. Even if a divorce decree, dated after 2008, gives
the non-custodial parent the right to claim the child, he must still get form
8332 from the custodial parent.
There is a
special rule in the case of divorced & separated (including never married) parents.
When the non-custodial parent is claiming the child as a dependent/exemption/child
tax credit; the custodial parent is still allowed to claim the same child for Earned
Income Credit, Head of Household filing status, and day care credit. This
"splitting of the child" is not available to parents who lived
together at any time during the last 6 months of the year; then only one of you
can claim the child for any tax reasons. The tax benefits may not be split in any
other manner.
Note in particular
that the non-custodial parent can never claim the Earned Income Credit, Head of
Household filing status or the day care credit, based on that child, even when the custodial parent has released
the exemption to him.
So, it's good idea to let the other parent know that you
will be claiming those items, as many first time divorced parents are not aware
of this rule and may try to claim those items, which will cause the IRS to send
out letters.
Ref: https://www.irs.gov/publications/p17#en_US_2017_publink1000170897 Scroll down to "Children of divorced or
separated parents (or parents who live apart)"
