If you are the custodial parent, you are entitled to the Head of Household status, along with EIC and the Child Care credit. The non-custodial parent can claim dependency if you allow him to or he has a court order. You will have to mail in your return. You may be asked at some point to provide proof that the children lived with you.
There is a
special rule in the case of divorced & separated (including never married) parents.
When the non-custodial parent is claiming the child as a dependent/exemption/child
tax credit; the custodial parent is still allowed to claim the same child for Earned
Income Credit, Head of Household filing status, and day care credit. This
"splitting of the child" is not available to parents who lived
together at any time during the last 6 months of the year; then only one of you
can claim the child for any tax reasons. The tax benefits may not be split in any
other manner. The IRS goes by physical custody, not legal custody
Note in particular that the non-custodial parent can never claim the Earned Income Credit (EIC), Head of Household filing status or the day care credit, based on that child, even when the custodial parent has released the exemption to him. If he claimed any of those things (he probably claimed the EIC), he will need to file an amended return. In the meantime the IRS will process your paper mailed return in 6-8 weeks.
So, it's good idea to let the other parent know that you will be claiming those items, as many first time divorced parents are not aware of this rule and may try to claim those items, which will cause the IRS to send out letters.
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