Support for Child

[familyman73]

Can I claim a child as a dependent if they lived in placement for 10 months of the year?  However, we have paid monthly support payment to local agency.

[xmasbaby0]

Do you mean your own child was placed with someone for most of the year in 2021?   If the child did not live with you for at least half the year then you cannot claim the child as a dependent.  Paying child support does not entitle you to clam the child on your tax return.  

IRS interview to help determine who can be claimed:

https://www.irs.gov/help/ita/who-can-i-claim-as-a-dependent

https://ttlc.intuit.com/questions/3113432-who-can-i-claim-as-my-dependent  

[familyman73]

Thank you.

[familyman73]

The child was removed from our home and placed with a local agency but we still have parental rights and pay support to this agency.

[Opus 17]

@familyman73 

That’s not important for IRS purposes.  The child must have physically lived in your home more than half the nights of the year to be a “qualifying child” dependent.  

If no one can claim the child as a qualifying child dependent, then you can claim them as a “qualifying relative” or “other” dependent if you provided more than half their total financial support.  It may be hard to prove you paid more than half their expenses since you don’t know how your support stacks up against resources provided by the state.  Also, if they have been placed with another family, that family can claim the child as a “qualifying child” dependent (if they had physical custody more than half the nights of the year) which will bar you from claiming them as a qualifying relative no matter how much support you provided.  

[Hal_Al]

Even if you can claim the child as a "qualifying relative"  (and even that is unlikely),  you can only claim the non refundable $500 "Other dependent Credit".  You cannot claim the Child Tax Credit or the Earned Income Credit, based on that child, because the child did not live with you for the required more than half the year.