My daughters other parent is claiming her this year, per our agreement. I want to E-file, the IRS rejected my claim due to the information about my daughter? Can I file?

[JohnB5677]

It sounds like you both tried to claim her as a dependent.  As it turns out the other parent filed first, so they got credit for her.  This is fairly easy to fix.  You have to go back through your Personal Info and answer the questions regarding her status so she will not be claimed by you as a dependent.  If you are alternating each year per your agreement, you will both have to make this adjustment each year.

Only one person can claim the tax benefits related to a dependent child who meets the qualifying child rules. Parents can't share or split up the tax benefits for their child on their respective tax returns.

The IRS allows the non-custodial parent to claim their child as a dependent. The non-custodial parent can claim the child as a dependent if the custodial parent agrees not to on their own tax return. However, you must obtain a signed IRS Form 8332 or similar written document from the custodial parent allowing you to do so. Parents who have joint custody may also use this form to alternate the tax years in which each can claim the dependent.

It's important that each parent understands who will claim their child on their tax return. If two people claim the same child on different tax returns, it will slow down processing time while the IRS determines which parent's claim takes priority.

Please see this TurboTax article referring to:  Both Parents Claim a Child

[Critter-3]

For tax purposes, there is no such thing as joint custody, regardless of what your legal agreement says. The requirement, to be custodial parent, is that the child lives with you MORE than 50% of the time. One of you has to be the custodial parent and the other the non-custodial parent. Yes, if necessary, it comes down to counting nights spent with each parent.

The custodial parent has first priority on claiming the children on her taxes; regardless of the amount of support provided by the non-custodial parent. The non-custodial parent can only claim the child as a dependent if the custodial parent gives permission (on form 8332) or if it's spelled out in a pre 2009 divorce decree. 

There is a way to split the tax benefits.

 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. The tax benefits may not be split in any other manner.

Note in particular that the non-custodial parent can never claim the Earned Income Credit, Head of Household filing status or the day care credit, based on that child, even when the custodial parent has released the exemption to him. 

[Hal_Al]

See @Critter-3 's explanation of how the tax benefits may be split, in your situation.  The other parent e-filed first and most likely claimed something he is not allowed (e.g. Earned Income Credit).  This prevents you from e-filing.  You will have to mail in your return.  

He probably didn't know about the splitting rules and will now have to file an amended return.  But that cannot happen fast enough to allow you to e-file.  The IRS will process your paper return and send you your refund even if he hasn't amended yet. 

Ref: https://www.irs.gov/publications/p17#en_US_2017_publink1000170897

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