Will filling out form 8332 to release the claim to child tax credit affect me since I filed as head of household already?

[noah44]

I filed my taxes as head of household and marked my child as my dependent, but did not receive a tax credit because I made too much. My ex-wife has asked that I sign a 8332 form to release the claim to the child tax credit so she can take advantage of the credit since she made less. Since I've already received my refund, will this affect me at all if I fill out this form, for example take away my HoH status?

[xmasbaby0]

Which one of you is the custodial parent?   The custodial parent is the one with whom the child spent the most nights---at least 183 nights.  When two divorced or never married parents share custody, if there is a signed 8332, then the custodial parent can file as Head of Household, get earned income credit and the childcare credit. The non-custodial parent gets the child tax credit (or the $500 credit for other dependents if the child is older than 16).

[noah44]

While we are 50/50 for custody, I claimed HoH since I'm paying child support. So assuming I'm the custodial parent this year, does that mean if I sign this form to allow her to have the tax child credit, it won't affect me in any way?

[noah44]

I read this which made me concerned: 

When you amend your filed taxes to include Form 8332, which allows your ex-wife to claim your child as a dependent, it could indeed affect your filing status if you were previously claiming the Head of Household (HoH) status based on the eligibility of that child. The Head of Household status has specific requirements, including paying for more than half of the household expenses and having a qualifying person live with you for more than half of the year. (WHICH I MEET THESE REQUIREMENTS)

If the only qualifying person you could claim for the HoH status is the child you are now allowing your ex-wife to claim, you might no longer meet the requirements for the HoH status. In such a case, if you do not have another qualifying person (such as another dependent child or a qualifying relative who meets the criteria), you might need to change your filing status to Single. (THISPART CONCERNS ME)

[DawnC]

The only parent who has the right to claim a child as a dependent is the parent whom the dependent spent the most nights with.  That parent (the custodial parent) is entitled to the Child Tax Credit, and also to file Head of Household, claim the Earned Income Credit, and the Dependent Care Credit.  The other parent (the noncustodial parent) cannot claim the child.  

If the custodial parent is supposed to give (or wants to give) the dependent exemption to the noncustodial parent in certain years, that is done by the custodial parent giving the noncustodial parent a signed form 8332 Dependent Release.   This allows the noncustodial parent to claim the Child Tax Credit and exemption only.  The ability to qualify for Earned Income Credit, Head of Household, and the Dependent Care Credit, always stays with the custodial parent and can't be waived, shared, or transferred.

Where can you find 8332?   Please see Pub 501.

If the child spent more time with you, you claim the kid and get Head of Household but due to your income, do not get EIC or the child tax credit.   If the child spent more time with her, she would claim HoH, EIC and the child tax credit.   In either of these more common situations, no Form 8332 is needed.    If you qualify to claim the child, you could give her Form 8332, and she could take the child tax credit and only the child tax credit.  

[texasman1]

Thanks for the explanation @DawnC .  One further question.

I have a signed 8332 where the child's mother gets to claim the exemption for even numbered years and I get him in odd numbered years.  We split custody and expenses 50/50.  Not sure if this impacts the situation, but she has remarried and has had a 2nd kid, so if you look at her AGI combined with her new husband it is higher than mine, but strictly comparing her AGI to mine, I believe I have the higher AGI.

For tax year 2024 I did not claim my son as a dependent, but I did claim Head of Household and Childcare Expense deductions.  For the first time ever, I got my return rejected by the IRS.  "F2441-526-01 - Each Form 2441 'QualifyingPersonSSN' provided must not be the same as a Form 2441 'QualifyingPersonSSN' of another accepted tax return for the same tax year."

The question is:

1)  am I entitled to claim the Head of Household and Dependent Care Expenses for the years she can claim the dependent deduction per Form 8332?

2)  Assuming I can file as HoH and get a deduction for Childcare Expenses, what are my next steps?  Do I have to call the IRS or does she have to file an amendment (and if she's unwilling?)

[KeshaH]

You are only able to claim Head of Household and the child care credit in the years that you aren't claiming the child if 1) you're the custodial parent and 2) you paid the cost of the keeping up the home for more than half the year. 

The custodial parent is the one that the child spends the most nights with. Even though you and your ex have 50/50 custody, one of you likely would have spent more nights with the child. If it was truly even, then you wouldn't meet the "paying the cost of keep up the home for more than half the year" test.

If, based on the information above, you determine that you qualify for head of household and the child care credit, you'll need to mail your return to be processed. The IRS will then request documentation for you to prove that you qualify.