Dependents

[Enemias]

My parents are divorced but live together with me and my sister all year. My dad earns more so he's claiming head of the household. I was filing my mom under single but I read that she can claim us for: Not a dependent ( EIC / Child Care Credit only ). Is this possible?

[macuser_22]

No.   That only applies to parents that have not lived together with the child at anytime during the last 6 months of the year.

Since you all live together only one parent can claim a child and all the benefits - they cannot be split.

[pk]

Generally agreeing with @macuser_22  --- (a) the parents are divorced  but are they living in state that recognizes common-law marriage  and are they holding themselves  out as a couple ( even if they are divorced);  (b) if they are really divorced for intents and purposes and are not married to anyone else, then the parent that is maintaining a household for the underage  qualifying child/children can indeed claim that child  for HoH purposes  ( because "considered unmarried " rules will not apply;  the other parent is single  and therefore can claim another qualifying child  for her deduction/child credit purposes.   (c)  However, both the divorcees living under one roof , co-mingling their earnings and expenses ( assumed ),  while not unheard of , could be challenged as to the intent of action.

[macuser_22]

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@pk wrote:

Generally agreeing with @macuser_22  --- (a) the parents are divorced  but are they living in state that recognizes common-law marriage  and are they holding themselves  out as a couple ( even if they are divorced);  (b) if they are really divorced for intents and purposes and are not married to anyone else, then the parent that is maintaining a household for the underage  qualifying child/children can indeed claim that child  for HoH purposes  ( because "considered unmarried " rules will not apply;  the other parent is single  and therefore can claim another qualifying child  for her deduction/child credit purposes.   (c)  However, both the divorcees living under one roof , co-mingling their earnings and expenses ( assumed ),  while not unheard of , could be challenged as to the intent of action.

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a) I see nothing in the post that suggests that they have a new common law marriage, (in which case they would file a joint return).

b) Yes the parent that maintains the household can claim HOH - I did not say otherwise.

And yes, if more than one child, each parent can claim one and all the benefits for that child, but the benefits  cannot be split. The question did not ask that.  It was asking about splitting benefits.

c) I do  not understand.

[Enemias]

Update: My parents are divorced AND not married to anyone else. We live in Florida who does not recognise common-law marriage. They share expenses of the home ( we all live under the same roof) but my dad earns more, by like 30k. That is why he will claim my sister and I. I was just wondering if my mom qualified for the: Not a dependent ( EIC / Child Care Credit only ). I did not understand the intent to action part.

[Hal_Al]

Simple answer: no. Your parents do not not meet the special rule for divorced parents, because they live together.

 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. 

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)"

[macuser_22]

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@Enemias wrote:
 I was just wondering if my mom qualified for the: Not a dependent ( EIC / Child Care Credit only ). I did not understand the intent to action part.

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No.  As I said in my first reply, that rule that allows that is the "Special rule for divorced or separated parents that live apart".

The "live apart" requires that they did not live together at any time during the last 6 months of the year as I said above.   Since they both live with the child, they do not meet the requirement.

[pk]

@Enemias, Title 26, IRC A.1.A.I.2  Defiles Head of Household under  section b (1) A as follows-->  ( only those items applicable to the case at hand :(

1. In general for purposes  of this subtitle , an individual shall be considered  head of household  if, and only if , such individual is not married at the close of the taxable year, is not a surviving spouse  …... 

(A) Maintains as his home a household for more than  one-half taxable year the principal  abode , as a memebr of household of 

                                (I) a qualifying child of the individual  ( as defined  in section 152(c)) determined without regard to section 152(e) .....

Section 152(c)  defines Qualifying child as:

                           (1)  In general the term Qualifying Child  means  with respect to any taxpayer , for any taxable year, an individual--

                                      (A) who bears  a relationship to the tax payer ….

                                      (B) who has the same  principal place of abode  as the taxpayer for more than one-half of such taxable year 

                                        (C)  who meets the age requirement s....

                                        (D) who has not provide over one-half of such individual's own support ….

                                         (E)who has not filed  a joint return .….

 Thus in my considered opinion, your father definitely can claim Head-of-Household with the proviso that he meets all the conditions called out above.  

The purpose of the special rules for divorced parents  (Section 152(e) ) is for the express purpose of allowing  divorced parents to equitably access/ distribution  of  the dependency  ( which requires residency ) , child credit, EITC etc. and has nothing  do with whether a child can be a qualifying child of one or the other parent.

The requirement  for parents to live apart for at least the last six moths of a year  is for the express purpose of the inclusion of parents who are not divorced but live apart ( considered un married  )

The fact that two single parents live under the same roof ( while may be unusual )  and with their children,  cannot be  used against them , at least for tax purposes. 

I rest my case