MFS and both spouses contributed $2500 to an FSA. My wife claims the child as a dependent and I claim him as non dependent for expenses only. My wifes return was rejected because I already show his SS on 2241 part II. If I had turbo tax skip part II or delete 2241 it would add in my $2500 as excess contribution (income on line 7 of 1040). Is my only option to amend my return, overide/delete his info in Part II of 2241 and resubmit? Can I have dependent care expenses and not have someone listed in Part II of 2241?
You can't split the benefits for a child unless you qualify for the Divorced or Separated Parents Rule. In this case, the custodial parent claims the child care, Head of Household filing status and EIC. The non-custodial parent, if given a Form 8332, can claim dependency and the Child Tax Credit.
Children of Divorced or Separated Parents (or Parents Who Live Apart)
In most cases, because of the residency test, a child of divorced or separated parents is the qualifying child of the custodial parent. However, the child will be treated as the qualifying child of the noncustodial parent if the rule for children of divorced or separated parents (or parents who live apart)(discussed next) applies.
Children of divorced or separated parents (or parents who live apart). A child will be treated as the qualifying child of his or her noncustodial parent if all four of the following statements are true.
- The parents:
- Are divorced or legally separated under a decree of divorce or separate maintenance,
- Are separated under a written separation agreement, or
- Lived apart at all times during the last 6 months of the year, whether or not they are or were married.
- The child received over half of his or her support for the year from the parents.
- The child is in the custody of one or both parents for more than half of the year.
- Either of the following applies.
- The custodial parent signs a written declaration, discussed later, that he or she will not claim the child as a dependent for the year, and the noncustodial parent attaches this written declaration to his or her return. (If the decree or agreement went into effect after 1984, seeDivorce decree or separation agreement that went into effect after 1984 and before 2009 , or Post-2008 divorce decree or separation agreement , later.
- A pre-1985 decree of divorce or separate maintenance or written separation agreement that applies to 2016 states that the noncustodial parent can claim the child as a dependent, the decree or agreement wasn’t changed after 1984 to say the noncustodial parent can’t claim the child as a dependent, and the noncustodial parent provides at least $600 for the child's support during 2016. See Child support under pre-1985 agreement , later
Although there is no one answer since every situation is different, generally filing jointly will give you a bigger refund or less taxes due. When you file separately, your tax rate is higher and you won't be able to claim:
• Student loan interest deduction
• Education benefits
• Earned Income Credit (EIC)
• Child and Dependent Care Credit
• Adoption Credit (usually)
• The same benefit married filing jointly couples get for personal exemptions, itemized deductions, the Child Tax Credit, and capital losses (all of these deductions are reduced by half)
• Itemized deductions if your spouse has already claimed the standard deduction, or the other way around.
On top of that, if you live in the community property states of Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin, you have to deal with community property allocations and adjustments, which adds extra work and complexity to your tax preparation chores.
Tip: Only taxpayers who were still legally married as of December 31, 2017 are able to file as marrieds, whether jointly or separately.