{"id":351618,"date":"2016-04-04T11:02:26","date_gmt":"2016-04-04T16:02:26","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/family\/child-custody\/child-custody-and-taxes.html"},"modified":"2023-07-11T15:18:40","modified_gmt":"2023-07-11T20:18:40","slug":"child-custody-and-taxes","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/family\/child-custody\/child-custody-and-taxes.html","title":{"rendered":"Child Custody and Taxes"},"content":{"rendered":"\n<div class=\"wp-container-core-columns-is-layout-9d6595d7 fl-sectionWithSidebar fl-container fl-flex fl-flex-wrap fl-gap30\">\n    \n    <div class=\"fl-page-articles fl-section-main fl-section-main-full-width\">\n        <h1 class=\"fl-no-margin-top\">Child Custody and Taxes<\/h1>\n<section class=\"fl-gutenberg-byline\">\n    <div class=\"fl-gutenberg-byline-content\">\n                    By <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/jade-yeban-j-d\/\">Jade Yeban, Esq.<\/a> | Legally reviewed by <a\n                href=\"https:\/\/www.findlaw.com\/company\/our-team\/rhonda-earhart-esq\/\">Rhonda Earhart, Esq.<\/a>\n                | Last updated\n        <time>\n                            July 11, 2023\n                    <\/time>\n    <\/div>\n\n    \n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-legally-reviewed\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Legally Reviewed\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>This article has been written and reviewed for legal accuracy, clarity, and style by <a href=\"https:\/\/www.findlaw.com\/company\/our-team.html\">FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with <a href=\"https:\/\/www.findlaw.com\/company\/company-history\/editorial-policy.html\">our editorial standards<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n\n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-fast-checked\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Fact-Checked\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>The last updated date refers to the last time this article was reviewed by FindLaw or one of our <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/contributing-authors.html\">contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please <a href=\"https:\/\/lawyers.findlaw.com\/?fli=bylinelink\" target=\"_blank\" rel=\"noopener\">contact an attorney in your area<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n<\/section>\n    <div class=\"fl-callout-text article-blockquote\">\n        <p>Child custody orders can have a significant impact on income tax deductions for parents. This is because tax laws and regulations consider custody arrangements and care of children when determining eligibility for tax credits and deductions.<\/p>\n\n    <\/div>\n\n<p>When you and your spouse decide to call it quits, you&#8217;re more worried about what your children will think than what the IRS will think. That&#8217;s only natural. When parents are dealing with&nbsp;<a href=\"https:\/\/www.findlaw.com\/family\/child-custody\/child-custody-basics.html\">custody issues<\/a>, the furthest thing from their minds is how it will affect their tax status. But if you want to avoid serious tax penalties\u2014or reap significant tax benefits\u2014it&#8217;s better to figure this out sooner than later.<\/p>\r\n<p>Here is a brief primer on&nbsp;<a href=\"https:\/\/www.findlaw.com\/family\/child-custody\/child-custody-basics.html\">child custody<\/a>&nbsp;and taxes.<br>\r\n<\/p>\r\n<h2>Benefits Available for Claiming a Dependent Child<\/h2>\r\n<p>There are numerous&nbsp;<a href=\"https:\/\/www.irs.gov\/publications\/p501\/index.html\" target=\"_blank\" rel=\"noopener\">standard tax benefits<\/a>&nbsp;to claiming a child as a dependent:<\/p>\r\n<ul>\r\n<li>The exemption for the child<\/li>\r\n<li>The child tax credit<\/li>\r\n<li>The head of household filing status<\/li>\r\n<li>The&nbsp;<a href=\"https:\/\/www.irs.gov\/taxtopics\/tc602.html\" target=\"_blank\" rel=\"noopener\">credit for child and dependent care expenses<\/a><\/li>\r\n<li>The exclusion from income for dependent care benefits<\/li>\r\n<li>The earned income credit<\/li>\r\n<\/ul>\r\n<p>However, the rules are more complicated for&nbsp;<a href=\"https:\/\/www.irs.gov\/publications\/p504\/index.html\" target=\"_blank\" rel=\"noopener\">divorced or separated parents<\/a>. If you claim your child as a dependent, you cannot split these benefits with the other parent, even by your own agreement.<\/p>\r\n<h2>Can Both Parents Claim a Dependent Child?<\/h2>\r\n<p>Parents cannot split the dependency exemption. For tax purposes, the custodial parent is the parent with whom the child resides for the greater portion of the tax year. Generally, the custodial parent is the parent who provided more than half of the child&#8217;s support. This parent can usually claim the exemption for the child if they meet the other exemption tests. However, courts may treat the noncustodial parent as the parent who provided more than half of the child&#8217;s support if they meet certain conditions.<\/p>\r\n<p>The custodial parent can sign a&nbsp;<a href=\"https:\/\/www.irs.gov\/pub\/irs-pdf\/f8332.pdf\" target=\"_blank\" rel=\"noopener\">Form 8332 Release of Claim to Exemption for Child of Divorced or Separated Parents<\/a>, or a substantially similar statement, and provide it to the noncustodial parent who attaches it to their return. Please be aware that if the custodial parent revokes the release of claim to the exemption, the custodial parent may not claim the&nbsp;<a href=\"https:\/\/www.findlaw.com\/family\/child-support\/the-child-tax-credit.html\">Child Tax Credit<\/a>.<\/p>\r\n<p>The parent exercising the claim to the exemption may claim the child as a dependent and may be eligible for various tax credits, such as the earned income tax credit and childcare credit. The non-custodial parent cannot claim the child as a dependent. But they may be able to deduct certain expenses related to the child&#8217;s care and upbringing, such as medical expenses or support payments (in some states).<\/p>\r\n<h2>Child Custody and Taxes: How the IRS Decides Who Gets the Benefits<\/h2>\r\n<p>Both parents treat the child as a qualifying child if you file a joint return. But if more than one person claims tax benefits,&nbsp;<a href=\"https:\/\/apps.irs.gov\/app\/vita\/content\/globalmedia\/teacher\/qualifying_child_more_than_one_person_tabc_4012.pdf\" target=\"_blank\" rel=\"noopener\">the IRS uses the following tiebreaker rules<\/a>&nbsp;to determine who can&nbsp;<a href=\"https:\/\/www.findlaw.com\/family\/child-custody\/who-can-claim-the-children-as-dependents-for-tax-purposes.html\">treat the child as a qualifying child<\/a>:<\/p>\r\n<ul>\r\n<li>If only one of you is the child&#8217;s parent, the IRS treats the child as the qualifying child of that parent.<\/li>\r\n<\/ul>\r\n<ul>\r\n<li>If both of you are the child&#8217;s parents, the IRS treats the child as a qualifying child of the parent with whom the child lived for a longer period of time during the year.<\/li>\r\n<\/ul>\r\n<ul>\r\n<li>If both of you are the child&#8217;s parents and the child lived with both of you for the same amount of time, the IRS treats the child as the qualifying child of the parent with the higher adjusted gross income (AGI) for the year.<\/li>\r\n<\/ul>\r\n<ul>\r\n<li>If no parent can claim the child as a qualifying child, the child is treated as the qualifying child of the person with the highest AGI for the year.<\/li>\r\n<\/ul>\r\n<ul>\r\n<li>If a parent can claim the child as a qualifying child, but no parent does so claim the child, the child is treated as the qualifying child of the person with the highest AGI for the year.<\/li>\r\n<\/ul>\r\n<h2>How Court Custody Orders Affect Deductions<\/h2>\r\n<p><a href=\"https:\/\/www.irs.gov\/publications\/p504\/ar02.html\" target=\"_blank\" rel=\"noopener\">IRS Publication 504<\/a>&nbsp;covers who may claim and how to claim a dependency exemption following a divorce or separation. Regardless of what custody orders the court has issued, federal law determines your federal tax status. Therefore, the IRS requirements supersede a county or state court order. But you can agree during custody negotiations to release your claim on the exemption using IRS Form 8332 (discussed above).<\/p>\r\n<p>The custody agreement or divorce decree typically outlines the custody of the child and which parent can claim the child as a dependent for tax purposes. It&#8217;s important for both parents to review and understand the agreement. They should also review any applicable tax laws. It&#8217;s important to ensure you&#8217;re properly filing taxes and claiming deductions.<\/p>\r\n<p>Parents who share&nbsp;<a href=\"https:\/\/www.findlaw.com\/family\/child-custody\/physical-custody.html\">physical custody<\/a>&nbsp;of the child may need to negotiate. This includes parents with&nbsp;<a href=\"https:\/\/www.findlaw.com\/family\/child-custody\/joint-custody.html\">joint custody<\/a>. They might need to coordinate their tax filings to avoid any discrepancies or conflicts. This can include determining who claims the child as a dependent, who claims the child care credit, and how to divide any tax refund.<\/p>\r\n<p>It&#8217;s also important for divorced or separated parents to communicate about parenting time and care arrangements. These factors can impact eligibility for certain tax deductions. For example, if the custodial parent allows the non-custodial parent to claim the child as a dependent, they may need to adjust their parenting time or&nbsp;<a href=\"https:\/\/www.findlaw.com\/family\/child-support.html\">support<\/a>&nbsp;payments accordingly.<\/p>\r\n<h2>Need to Know More About Your Child Custody and Taxes? An Attorney Can Help<\/h2>\r\n<p>When you&#8217;re trying to resolve a divorce, the last thing you want is the IRS scrutinizing your taxes. Child custody orders can have significant impacts on tax deductions for parents. A family law attorney can help you resolve any disputed tax issues in your divorce. They can also help you determine who can claim and how to claim any tax benefits for your dependent children.<\/p>\r\n<p>A family law attorney with experience in tax law will help tremendously. They can help you navigate tax deductions and tax exemptions. They can review your tax returns and give valuable legal advice. They can also help ensure you receive any available deductions or exemptions as it concerns alimony or child support payments.<\/p>\r\n<p>Find an experienced&nbsp;<a href=\"https:\/\/lawyers.findlaw.com\/custody-visitation\/?fli=dcta\" target=\"_blank\" rel=\"noopener\">family law attorney<\/a>&nbsp;who can help you with your child custody case today.<\/p>\r\n<div class=\"was-this-helpful\">\n    <div\n            class=\"was-this-helpful__question-container\"\n            aria-labelledby=\"was-this-helpful__question\"\n            role=\"group\"\n    >\n        <span\n                id=\"was-this-helpful__question\"\n                class=\"was-this-helpful__question fl-text-lg-bold\"\n        >Was this helpful?<\/span>\n        <button\n                class=\"was-this-helpful__button fl-text-sm\"\n                aria-label=\"Yes\"\n                value=\"yes\"\n        >\n            <span class=\"was-this-helpful__button-text fl-text-bold\">Yes<\/span>\n            <i class=\"was-this-helpful__button-icon\">\n                <svg width=\"22\" height=\"22\" viewBox=\"0 0 22 22\" fill=\"none\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\">\n                    <g id=\"thumbs-up\" clip-path=\"url(#clip0_604_3418)\">\n                        <path id=\"Vector\"\n                              d=\"M6 21H3C2.46957 21 1.96086 20.7893 1.58579 20.4142C1.21071 20.0391 1 19.5304 1 19V12C1 11.4696 1.21071 10.9609 1.58579 10.5858C1.96086 10.2107 2.46957 10 3 10H6M13 8V4C13 3.20435 12.6839 2.44129 12.1213 1.87868C11.5587 1.31607 10.7956 1 10 1L6 10V21H17.28C17.7623 21.0055 18.2304 20.8364 18.5979 20.524C18.9654 20.2116 19.2077 19.7769 19.28 19.3L20.66 10.3C20.7035 10.0134 20.6842 9.72068 20.6033 9.44225C20.5225 9.16382 20.3821 8.90629 20.1919 8.68751C20.0016 8.46873 19.7661 8.29393 19.5016 8.17522C19.2371 8.0565 18.9499 7.99672 18.66 8H13Z\"\n                              stroke=\"#666666\" stroke-width=\"2\" stroke-linecap=\"round\"\n                              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          >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--missing-info\"\n                        >Missing the information I need<\/label>\n                    <\/div>\n                    <div class=\"fl-radio-button-field fl-flex was-this-helpful__feedback-form-title\">\n                        <input\n                                id=\"was-this-helpful__radio-button--complicated\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"negative-feedback\"\n                                value=\"Too complicated\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--complicated\"\n                        >Too complicated \/ too many steps<\/label>\n                    <\/div>\n                    <div class=\"fl-radio-button-field fl-flex was-this-helpful__feedback-form-title\">\n                        <input\n                                id=\"was-this-helpful__radio-button--dated\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"negative-feedback\"\n                                value=\"Out of date\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--dated\"\n                        >Out of date<\/label>\n                    <\/div>\n                    <div class=\"fl-radio-button-field fl-flex was-this-helpful__feedback-form-title\">\n                        <input\n                                id=\"was-this-helpful__radio-button--negative-other\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"negative-feedback\"\n                                value=\"Other\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--negative-other\"\n                        >Other<\/label>\n                    <\/div>\n                <\/fieldset>\n            <\/div>\n            <div class=\"was-this-helpful__form-buttons-container\">\n                <button\n                    class=\"was-this-helpful__feedback-button was-this-helpful__feedback-button--positive at-feedback-submit fl-button secondary\"\n                    type=\"submit\"\n                >\n                    <span class=\"fl-button-content\">Submit<\/span>\n                    <i\n                        class=\"fa fa-angle-right medium\"\n                        aria-hidden=\"true\"\n                    ><\/i>\n                <\/button>\n                <button\n                    class=\"was-this-helpful__feedback-button was-this-helpful__feedback-button--cancel fl-button primary disabled\"\n                    type=\"reset\"\n                >\n                    <span class=\"fl-button-content\">Cancel<\/span>\n                    <i\n                        class=\"fa fa-times-circle medium\"\n                        aria-hidden=\"true\"\n                    ><\/i>\n                <\/button>\n            <\/div>\n        <\/form>\n    <\/div>\n    <div class=\"was-this-helpful__thank-you-message\" role=\"status\">\n        <i class=\"was-this-helpful__thank-you-message-icon fa fa-check\"><\/i>\n        <p class=\"was-this-helpful__thank-you-message-text\" aria-live=\"polite\"><\/p>\n    <\/div>\n<\/div>\n\n\n    <\/div>\n    \n    <div class=\"fl-section-sidebar\">\n        <div class=\"fl-editors-summary\" data-testid=\"fl-editors-summary\">\n    \n    <div class=\"fl-editors-summary-content\" data-testid=\"fl-editors-summary-content\">\n                    <h2>Can I Solve This on My Own or Do I Need an Attorney?<\/h2>\n                <div class=\"fl-editors-summary-content-main\" data-testid=\"fl-editors-summary-content-main\">\n            \n        <\/div>\n        <ul class=\"fl-list-style-none\">\n                            <li data-testid=\"fl-editors-summary-content-item\">\n                    <i class=\"fa fa-check medium fl-editors-summary-content-item-icon\" aria-hidden=\"true\"><\/i>\n                    Both parents can seek custody of their children &#8211; with or without an attorney\n\n                <\/li>\n                            <li data-testid=\"fl-editors-summary-content-item\">\n                    <i class=\"fa fa-check medium fl-editors-summary-content-item-icon\" aria-hidden=\"true\"><\/i>\n                    An attorney can help get the custody and visitation agreement you want\n\n                <\/li>\n                            <li data-testid=\"fl-editors-summary-content-item\">\n                    <i class=\"fa fa-check medium fl-editors-summary-content-item-icon\" aria-hidden=\"true\"><\/i>\n                    An attorney will advocate for your rights as a parent\n\n                <\/li>\n                    <\/ul>\n                    <div class=\"fl-editors-summary-content-description\" data-testid=\"fl-editors-summary-content-description\">\n                <p>A lawyer can help protect your rights and your children&#8217;s best interests. Many attorneys offer free consultations.<\/p>\n\n            <\/div>\n                            <div class=\"fl-editors-summary-content-link fl-flex\" data-testid=\"fl-editors-summary-content-link\">\n                <i class=\"fa fa-angle-right medium\" aria-hidden=\"true\"><\/i>\n                <p class=\"find-attorney\"><a href=\"https:\/\/lawyers.findlaw.com\/custody-visitation\/#USER_GEO\/?fli=esum:FL24\" target=\"_blank\" rel=\"noopener\">Find a local attorney<\/a><\/p>\n\n            <\/div>\n            <\/div>\n<\/div>\n\n\n<div class=\"email-subscription fl-mb30\">\n    <div class=\"email-subscription-header\">\n        <div class=\"email-subscription-header-content\">\n            <h3 class=\"fl-callout-sm fl-no-margin\">Stay Up-to-Date With How the Law Affects Your Life<\/h3>\n        <\/div>\n        <div class=\"email-subscription-header-image fl-flex fl-items-end\">\n            <img decoding=\"async\"\n                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class=\"fl-image-card\">\n                <div class=\"fl-image-card__content\">\n            <div class=\"action-card-layout\">\n                <h2 class=\"action-card-layout__heading\">\n                    Don&#8217;t Forget About Estate Planning\n                <\/h2>\n                <div class=\"action-card-layout__content fl-text-lg\">\n                    <p>Once new child custody arrangements are in place, it\u2019s an ideal time to create or change your&nbsp;<a href=\"https:\/\/nam02.safelinks.protection.outlook.com\/?url=https%3A%2F%2Fwww.findlaw.com%2Fforms%2Festate-planning.html&amp;data=05%7C01%7CBrittany.Walker%40thomsonreuters.com%7C2d4e4b227c9a4fb86af008dbda212946%7C62ccb8646a1a4b5d8e1c397dec1a8258%7C0%7C0%7C638343608191470728%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=ugL7827i26y6liCh89pIwdM9VXepZNlmC3Lfd6OfyyA%3D&amp;reserved=0\" title=\"DIY Forms\">estate planning forms<\/a>. 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