Why didn't we receive Child tax credit for 2 out of 3 kids

[Thisiserica]

Thank you so much for replying. I greatly appreciate it.

I'm confused about what you mean by "a dependent cannot claim a dependent". I'm sorry but i know nothing about this stuff. I had to go through a process stating that their fathers couldn't claim them as they are mostly with us except here and there and stating that he has been sole provider for them as I get very little in child support if I even get it. I am curious as to why the accountant didn't mention this before filing and if there was another way or option. We just realized that this accountant had gotten the birthdays all wrong when she filed. I hope that doesn't hurt us in future. I had wondered if that had any impact on the child tax credit...guess not. Also, I could have not done all that and let the father who is thousands behind in child support claim my son and his refund would have been intercepted and paid to me. Obviously, that accountant is fired. 

I was told that if I filed he might have to pay back what he received in refund, but that it might be worth it if it's more than refund received? Do you know if that is true?

In my opinion, this is a very outdated tax law/rule (whatever it's called). We have been together 7 years. Pandemic happened and wedding was called off. It is upsetting to know that I have to be married to someone who has been taking care of my children financially all these years to count towards tax breaks/ credits. Also, I find it upsetting that I quit working because of daycare costs and the needs of kids had grown to where I felt like I was basically always on call so to say....but because of this job as homemaker that doesn't pay, we are penalized because I am a dependent? Or was claimed as a dependent?

Is there another way to file me as? Or would not including me at all be better? So accountant was right that myself and sons are basically nothing to the government bc I had to quit working because ironically I couldn't afford to work and am not married yet? 

Also I know a couple who both don't even work and don't pay taxes and filed and got their child tax credit for their child. Which upsets me because we/he pay/s taxes, but bc I was claimed as a dependent we don't get child tax credit for our 2 kids. All this is so confusing and doesn't seem to make sense. 

If you could please help me understand, I would greatly appreciate it @xmasbaby0 

[xmasbaby0]

When someone is claimed as a dependent---as you have been claimed by your BF--- it means that you do not pay for even half of your own support.   Someone else is paying to support you by paying for your housing, food, clothing, medical care, etc. etc. etc      One requirement to claim a dependent is that you must provide more than 50% of their support, which is the cost of basic life necessities such as food, lodging, clothing, medical and dental care, education, transportation, utilities, and so forth.

If you are someone else's dependent, then you cannot claim to support a dependent of your own--since you do not even support yourself.   That is why a dependent cannot claim a dependent.   Being claimed by your BF prevents you from claiming to support your children and prevents you from getting the child tax credit or the stimulus payments for them.   The way the accountant said that it means you are "nothing" to the government sounds pretty harsh---but Congress wrote the tax laws and the law says a dependent cannot claim a dependent.

Your tax situation would be quite different if you were legally married.   If you had been legally married by the end of 2021 then you would be able to file a joint tax return, even if you had no income yourself.  Then all three children could be claimed on the joint tax return and you could receive the child tax credit and any other child-related credits for claiming them---like earned income credit, childcare credits, education credits, etc. etc.   But that is hindsight that does you no good for 2021.

Since you are not married and your BF is supporting you and the children, he has claimed you and your two children as "qualifying relatives."    That means he can only get a small $500 credit for claiming you and your two kids since they are not really related by blood to him, nor are they legally his step-children.   He cannot get the child tax credit for claiming them, and he cannot get earned income credit for claiming them.

https://ttlc.intuit.com/questions/4499708-what-is-the-500-credit-for-other-dependents-family-tax-cre...

And here is where it gets trickier....Congress wrote the tax law for 2021's child tax credit and removed any requirement for the person claiming the child to work or have any taxable income.   Under the current tax law, if a parent who had NO taxable income claims the child, they can get the child tax credit for 2021.  That is why you are seeing people who do not work get this credit.    In past years, and so far for tax year 2022 and beyond, there has been a requirement for the person to have income from working in order to receive the child tax credit.   Only 2021 is different.

Someone may have told you to file your own tax return  by mail and claim the children yourself.  You could *probably* do that for 2021 and get away with it.   If you do that, your BF would have to amend his return and delete you and your two children as dependents on his return.  He would have to repay any part of the refund that was based on claiming any of you--including stimulus money if he got it on his 2021 return.  

So it comes to whether you want to take a chance on filing a tax return that says you cannot be claimed as a dependent so that you can get the CTC.   Would you be filing a truthful tax return?  No.

https://ttlc.intuit.com/community/dependents/help/when-do-i-have-to-answer-yes-to-being-claimed-as-a...