I am interpreting this as you are the GREAT Grandmother and your daughter, grand daughter and great grandchildren all live with you?
Yes. A 1040X is the appropriate form to file. But as to who should claim the kids and what status to choose depends on a few things.
To file as Head of Household, you have to:
- Pay for more than half of the expenses for a qualifying household
- Be considered unmarried on the last day of the tax year or if married not have lived with your spouse at all for the last 6 months of the year
- Have a qualifying child or dependent
If your daughter is not providing over half of the cost of the upkeep of the household, then she cannot claim head of household. She can still claim the kids for the child tax credit and Earned Income Tax Credit, but not head of household.
If you are the person who covers the costs of over half the household expenses, then you would be able to claim them again and file as head of household as long as your daughter agrees to it.
The other thing to consider is who has physical custody? If the women in your household have physical custody for more than 6 months out of the year (over 50% of the year), then the father cannot claim the children as dependents for the purpose of head of household. So the kids could have still been on your or your daughters return to file as HOH. IF the father is the custodial parent having the kids over 50% of the year, then no one in your household would be able to claim the kids for purposes of head of household.
In order for the non custodial parent to claim the child tax credit for the kids, the custodial parent needs to fill out form 8332 to give permission. But, they can still enter the child on their return and claim other tax benefits such as the Earned Income Tax credit which is NOT available to the non custodial parent.
