Unmarried parents living together with two kids - SALT & Dependent Care FSA

[Mvanmeter14]

Multiple parts to this. We share a house and split the mortgage payments. Assume everything as would be in a typical married family but unmarried. Both children are ours.

• For SALT, do we each have a $10k limit?
• For dependent care FSA, can both of us have one (one for each child-claimed as a dependent for that parent) at the $5k max for each of the kids?

[Critter-3]

Yes to each question for unmarried parents.

[Mike9241]

sorry, but it may be improper for each of you to claim 1 child under the tax rules 

since you are both the parents

apparently, you live together for the whole year then

the IRS says it's the parent with the highest AGI that's entitled to claim them.. so if you both filed as head of household claiming one child you both misfiled. one gets both the other files as single. 

some states recognize a common law marriage - but most require that it be recorded.

you need the help of a tax pro because there are significant penalties for claiming tax credits you are not entitled to. 

[Mvanmeter14]

• State does not require common law.
• Have not yet filed this way, is for upcoming year.
• Entitled is not required
• Only one would file as HoH, would not have both file that way.

edit: basically trying to decide if for tax purposes its actually more beneficial to remain unmarried. Have similar incomes, within 25%.

[rjs]

The "higher AGI" rule only applies if both parents claim the same child. You can each claim one child, or either one of you can claim both children, as long as you don't both claim the same child.

[TomD8]

The parent who pays more than half of the household expenses can file HOH (if they claim one or both children).  The other parent must file as Single.