Unmarried Parents of 1 child living together - dependent care expenses

Forum|Forum|4 years ago
December 14, 2021
2 replies
14 views

Hello,

My boyfriend and I live together and had a daughter on September 19. We were thinking my boyfriend would claim my daughter on his taxes since he makes more money, is this thinking correct? Additionally, we split her expenses 50/50 so who should create a dependent care HSA? Is it possible that one of us creates the dependent care FSA and one doesn't?

xmasbaby0

Level 15

If you live together with your child only one of you can claim the child as a dependent on a tax return. There is no "splitting" of the child-related credits if you live together as a family. If you are unmarried then the one who claims the child can file as Head of Household; the other parent files Single. Try preparing your returns both ways to see which way works out better for you---mom OR dad claiming the child. It cannot be both.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

Opus 17

Level 15

Only one parent may claim the child as a dependent. Only the parent who claims the child as a dependent can qualify to use an FSA or claim the child and dependent tax credit. Only the parent who claims the child as a dependent can use the child to qualify for EIC and head of household status. In short, you can't "split" any of the tax benefits of claiming a dependent.

Usually, the tax benefit will be larger when the parent who earns more claims the child, because they can also claim head of household status. Sometimes, if the parents who earns less will qualify for EIC, it will be better for the parent who earns less to claim the child (although they can't file as head of household if they pay less than half the overall household expenses, and the other parent must file as single if they don't claim a dependent.). The only way to know in your case is to test different combinations.

Be aware that in Turbotax, the parent who will claim the child should answer "no" to the question about a custody agreement, because this only applies to a court order between parents who are separated and live apart. And the parent who will not be claiming the child should not even list them on their return. The Turbotax interview questions are designed for parents who live apart and share custody and can lead to incorrect tax returns for parents who live together unmarried. Make sure the parent who will claim the child answers that the child lived with them "all year" (which is correct for a newborn) and don't file until you have the child's social security number.

Mike9241

Level 15

the tax law says that if either parent can claim, then thethe following rule applies

IRC Sec 152(c)(4)

(B)More than 1 parent claiming qualifying child
If the parents claiming any qualifying child do not file a joint return together, such child shall be treated as the qualifying child of—
(i)the parent with whom the child resided for the longest period of time during the taxable year, or
(ii)if the child resides with both parents for the same amount of time during such taxable year, the parent with the highest adjusted gross income.

Mike9241

Opus 17

Level 15

@Mike9241 wrote:

the tax law says that if either parent can claim, then thethe following rule applies

IRC Sec 152(c)(4)

(B)More than 1 parent claiming qualifying child
If the parents claiming any qualifying child do not file a joint return together, such child shall be treated as the qualifying child of—
(i)the parent with whom the child resided for the longest period of time during the taxable year, or
(ii)if the child resides with both parents for the same amount of time during such taxable year, the parent with the highest adjusted gross income.

Income is the tiebreaker if the parents don't agree and both parents claim the child. But if they are in agreement, then either parent can claim the child, and as long as only one parent claims the child, (4)(B) is not triggered.