Are you a custodial parent who has released your claim to any dependent exemptions on your federal return?

[sokshan]

I don't understand it

[Texas Roger · Accepted solution]

If you are divorced or live apart from the other parent, the tax benefits for a qualifying child can be split. The custodial parent who the child lived with more than half the year may qualify to file as Head of Household and get Earned Income Credit and Child Care Credit.

The custodial parent can either claim the dependency exemption or release it to the non custodial parent. If released, the non custodial parent can claim the dependency exemption and get the child tax credit for a child under age 17. The custodial parent needs to provide form 8332 or a similar statement to the non custodial parent if the dependency exemption is released. 

Parents who live together even if they are not married cannot split the child tax benefits. They can agree on who will claim the child for all the benefits.