Can I claim my children as dependents if my partner(their father) claims them? And do I file as head of household or single?

[mmkaiser714]

My boyfriend and I are not married, but we've lived together for almost 5 years. I'm about to start a new job, and need to know what to file. We have twin boys and I would like to know if I can claim them as dependent if he already claims them. Also, do I file myself as single or head of household? 

[Opus 17]

1. Only one parent can claim a child as a dependent.

2. To file as head of household, you must be unmarried, AND provide care in your home for at least one qualifying dependent, AND pay more than half the cost of keeping up the home.

3. Since you and your BF live together, only one of you can pay "more than half" of the household costs, so only one of you can file as head of household.  The other must file as single.

4. If both you and the boyfriend are both biological parents of all 3 children, and you lived together for more than half the year, then either parent can claim the children in any combination (3 and 0, 1 and 2, etc.) but each child can only be claimed once.  

5. The person who pays more than half of the household expenses is often the higher earner but not always.  If, for example, one of you pays a lot of child support to someone else, then that person might not pay very much toward your current household expenses.  

6. The best way to file your taxes in any given year will be for the person who pays more than half the household expenses to claim at least one child as a dependent and file as head of household.  The other parent files as single.  Either of you could claim the other 2 children and what combination is best is something that has to be tested in turbotax by making different combinations of tax returns.  (Note, this is much easier to do with the desktop installed version than online.)

7. For your 2016 taxes, now is a good time to think about how you plan to file.  If you want to file as head of household you must pay more than half the expenses and claim at least one child dependent.  If your BF has previously claimed all 3 then he may need to adjust his withholding as well since he will have to file as single with fewer dependents. 

8. For your 2015 taxes (that are overdue), if you are filing late, or if you already filed late and want to amend, only one parent can claim each child.  If you want to claim one or more children as dependents your BF will have to amend his return to remove any duplicate dependents.

9. In Turbotax you will encounter a question like "do you have a custody agreement with the other parent about who will claim the child" when doing the dependent section for each child.  Answer NO; this question only applies to unmarried or divorced parents who live apart and share custody.  For unmarried parents living together, the best thing to do in the program is not even list the children that you are not claiming.  Otherwise you can accidentally claim the children twice or be denied the dependent based on answering the questions wrong (it is a confusing question that should not be asked in your situation. So say "no" to get past it.)

[Opus 17]

10.  If some of your household support comes from family, charity, or the government (welfare, section 8, etc.) then it is possible that neither parent pays "more than half" which means neither parent can be head of household and both can only file as single.  (This obviously does not apply to all taxpayers.)

[mmkaiser714]

Okay, he makes probably around 25,000 and I may only make 13,000 a year. So it would probably be best for myself to just file and single with no dependents?

[mmkaiser714]

Also, I'm trying to remember. If you usually have a dependent they don't take as much taxes out right? Does anyone know what my tax percent will be for federal if I just file single with no dependents or is it based off the state/city you live in?

[SweetieJean]

@Opus 17   They have 2 children, not 3.

[Texas Roger]

You would need to both do sample tax returns with your BF claiming both children and you claiming none or with him claiming one and you claiming one to see how the total comes out for both tax returns. Your federal tax percentage on your taxable income would be 10%. You subtract your standard deduction, personal exemption and dependency exemption for each child you claim from your total income to determine taxable income. If you claim a child, you would be eligible for child tax credit or additional child tax credit and earned income credit. The total of these might more than offset any tax liability. I suggest you use the TurboTax calculator to help you decide: <a rel="nofollow" target="_blank" href="https://turbotax.intuit.com/tax-tools/calculators/taxcaster/">https://turbotax.intuit.com/tax-tools/...>

[Opus 17]

At your income levels, both of you are probably eligible for the Earned Income Credit, and the credit is much larger if you have at least one child.  Probably the best way for you to file is for the BF to file as head of household with 1 dependents and for you to file as single with 1 dependent.  Your BF may get less EIC for 1 rather than 2, but you might get more for 1 rather than zero.

However, as I said, the only way to be sure is to test different combinations in Turbotax.  If you want to use Turbotax online, make a different account with a different user name and password for each test.  Or start with the TaxCaster here <a rel="nofollow" target="_blank" href="https://turbotax.intuit.com/tax-tools/calculators/taxcaster/">https://turbotax.intuit.com/tax-tools/...>

You can figure out exactly what your federal withholding will be using the tax tables in chapter 17 here. <a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/p15.pdf">https://www.irs.gov/pub/irs-pdf/p15.pdf</a>

Although it can be complicated.  If you are single earning less than $767 per week, you subtract $77 for each allowance you claim, and pay 15% on the rest (roughly).  State withholding uses similar formulas but the percentages are usually lower, 3-7% for most states.

[Opus 17]

Corrected the dependent numbers in the above answer.  Somehow I thought twins plus 1...

[mmkaiser714]

The only thing with trying to figure out his taxes, is that he's self employed. So he doesn't have his taxes taken out until he files, I believe? I know in 2014. He got back almost 7,000$

[Opus 17]

It's possible to estimate self-employment taxes, it's just more difficult.  Sounds like he got a lot from EIC.  What you would do would be to run the tests next year when you get ready to file, after you have his SE results, and see which combination gives you the bigger refund.  If you are concerned about withholding for a new job now, then start by assuming you will not claim any dependents.  If you later do claim one, you will get that extra withholding back.

[mmkaiser714]

Okay, he still hasn't filed his 2015 tax return yet. He's working with his tax account and had to get an extension, since he's gone a lot for work. He just opened his own business in June. So I'll have him ask his tax account when he sees her again. Also our sons were just born in 2013, so I'm not sure if that effected the EIC for 2014.

[Opus 17]

As long as the child was alive on December 31, 2013, they would be dependents for 2013 and 2014, and might allow one or both of you to claim EIC, depending on your other income.

For the years when you didn't work, then only he will have claimed them and there's nothing to go back and re-check, assuming the tax returns were done correctly.  If you are just starting a job now (2016), then it is your 2016 tax return (to file next spring) where you will want to consider testing some different combinations of dependents.  His accountant should be able to do this pretty easily.

[mmkaiser714]

Okay thank you. So for right now it would be best to file single and no dependents. If I can find his 2014 tax returns and see how much he had to pay in for federal and state. I'll send a comment.

[Texas Roger]

If you had no income in 2015, there is no reason for you to file a 2015 tax return.