Parents had a 50/50 physical custody agreement since divorce in 2009. We have alternated every other year and confirmed who would file the dependency credit. This year is my turn and out child lived with me at least 60% of the year. Our child's medical/dental insurance, bank accounts, drivers licence and school records all list my address.
Our child turned 18 in October 2017 and is a full time college student as of August 2017. I contacted the other parent to confirm I would claim the child this year and they said "Guess we’ll have fun with IRS audits." This leads me to believe they have already filed and claimed our child, or they intend to.
What should I do? Should I just file a paper return and attach documentation explaining the (possible) discrepancy. Should I wait for a rejection and/or audit notice?
File your tax return and if your husband files children as the dependent, your return will be rejected. You would then need to file a return on paper. Later you'll receive a letter from the IRS, stating that your child was claimed on another return. It will tell you that if you made a mistake to file an amended return, and if you didn't make a mistake, do nothing. The other party will get the same letter you did. If one of you doesn't file an amended return, unclaiming the child, the next letter, from the IRS, will require you to provide proof. Be sure to reply in a timely manner.
Not that it matters for the outcome, but I am the father. So, you recommend that I wait for the IRS to reject my return, rather than initially submitting a paper return with an explanation?
I am sorry for the confusion with husband/wife custodial parent. From your explanation, I understood you're not quite sure if your wife filed your child as a dependent. One way to know for sure is if you e-file and the IRS rejects your return. On the other side, you can paper file as well.