Just recently got divorced in June 2019. I have 2 kids with my ex. We have joint legal and physical custody of our kids. The divorce decree says we each claim 1 kid on our taxes. My ex just recently got her taxes done and says she could claim both kids,because she has them 2/3 of the time and the new tax law ignores the divorce decree. I am saying I still am able to claim 1 child per the divorce decree. Who is correct?
The IRS uses physical custody of greater than 183 nights in the home for the child to be claimed as a dependent.
You need to speak to your attorney if she is not abiding by the court order, this is a legal question that cannot be handled in this forum.
Yes, the IRS will agree with your ex spouse because they are the custodial parent and you don't have form 8332 signed. You would need to get your divorce decree enforced to make her amend and sign the 8332 to release the child to you. The IRS will not enforce your divorce decree for you so it looks like you might have to go back to court.
As ZTaxPro said above, you must have your ex-spouse sign the Form 8332 to be able to claim the child. You probably will have to go back to family court if she does not do so willingly to enforce the divorce decree.
There is no such thing in the Federal tax law as 50/50, split, or joint custody. The IRS only recognizes physical custody (which parent the child lived with the greater part, but over half, of the tax year. That parent is the custodial parent; the other parent is the noncustodial parent.)
Who can claim the exemption and credits depends on who is the custodial parent. (By the IRS definition of custodial parent for tax purposes - this is not the same as the legal custody that a court might grant.).
The test that the IRS uses to determine the custodial parent is where the child lived for more than 1/2 (or greater part) of the year. The IRS will go so far as to require counting the nights spend in each household - that person is the custodial parent for tax purposes (if exactly equal and more than 183 days - The custodial parent is the parent with the highest AGI, if less than 183 days then neither parent has custody so the child cannot be claimed by either parent). And yes they are that picky.
See Custodial parent and noncustodial parent in Pub 501
Only the Custodial parent can claim: (Child would be listed as non-dependent EIC & CC only)
-Head of Household
-The Earned Income Credit
-The Child and Dependent Care Credit
-The Health Coverage Tax Credit
The non custodial parent can only claim: (Child would be listed as dependent)
- The child as a dependent
- The Child Tax Credit or credit for other dependents
But only if specifically specified in a pre-2009 divorce decree, separation agreement or the custodial spouse releases the exemption with a signed 8332 form - after 2009 the IRS only accepts a signed 8332 form that must be attached to the non-custodial parents tax return.
Note. If you are the non-custodial parent filing your return electronically, you must file Form 8332 with Form 8453, (U.S. Individual Income Tax Transmittal) for an IRS e-file Return. See Form 8453 and its instructions for more details. This must be done within 3 days of your e-filed return being accepted by the IRS.
This does NOT mean that the custodial parent can ignore any Decree or court order allowing the non-custodial parent to claim the exemption - they can be required to issue the 8332 form. They could be required by the court to do so or be in contempt.