Income Tax Child Deduction / Credit Who Claims question...

What is the name of your state (only U.S. law)? NH

Happy almost Turkey Day, everyone!

Looking for some more legal advice - and I'm not sure I'm in the right forum. If not, please let me know where I should be posting this.

When we got divorced, I wasn't working, and due to the age of our children and my financial ability to stay home, I wasn't going right back into the work force.

We had 3 children together, and the decree, in reference to our taxes, states:
"A. Until (Mom - AKA BalloonGirl) is employed for at least thirty-five (35) hours per week for a period equaling at least six months of the tax year, (Mom) shall claim (middle child) as a tax exemption and tax credit for federal tax purposes and (Dad) shall claim (oldest and youngest child) as tax exemption and child tax credit for federal tax purposes.

B. Upon (Mom) obtaining employment for at least thirty-five (35) hours per week for a period equaling at least 6 months of the tax year, (Mom) shall claim (middle child) as a tax exemption and tax credit for federal tax purposes, and (Dad) shall claim (oldest child) as a tax exemption and tax credit for federal tax purposes; the parties shall alternate claiming (youngest child) as a tax exemption and child tax credit for federal tax purposes with (Mom) claiming (youngest child) in odd tax years, and (Dad) claiming (youngest child) in even tax years."

Anyhow - as of 2007 - I started working in the school system, 37+ hours per week on average during the school year. I started October, 2007, so it wasn't an issue then.

I notified him earlier this year that since I had met the 35 + hours, 26+ weeks / year requirement, I would be claiming (youngest child) this year.

I got this today:
"Per our attorney, it is for you to prove to us (or the court) that you have been employed at least 35 hours per week for 26 weeks in 2009. Also, per our attorney receiving a stipend from the church does not qualify as part of the hours of being employed.


If you do have letters from your employer(s) stating that you were employed 35 hours per week for 26 weeks our attorney would appreciate them as soon as possible."

(Oh yeah, I forgot to mention that besides working in the schools, I cantor and direct a church choir - for which I am paid a flat rate per service. Not a stipend, I am an employee, with taxes withheld, SS paid, etc. I average about 4 - 5 hours a week at church.)

So... do I have to provide that to him? Or to the IRS if we both attempt to claim it?

You worked more than 35+ in 2009, right?

Yes, I did.

However - I worked as a sub, and my check stubs say how many days I worked, not the hours. My church pay stubs only say the # of services per month, not a weekly breakdown.

And I guess I'm being a bit stubborn - he refuses to even tell me where he's working, but wants proof that I'm working 35+/week?

I have no problems with getting letters if the IRS requires them as proof as the number of hours my checks actually covered rather than the number of days / services - if necessary.

It's not an IRS issue. The IRS couldn't care less how many hours or days you worked. They only want to know how much money you earned.

Let's go back to basics. As far as the IRS is concerned, the parent who has primary physical custody (the most overnights) gets the deduction. If you both have the same number of overnights, there are tie-breaker rules.

The only way to change that is by having the person who is entitled to the deduction by IRS rules to sign an 8332 form which gives the deduction to the other person.

So, there are two scenarios:
1. If you are entitled to the deduction by IRS rules (most overnights), then you are entitled to all 3 deductions. You would then sign an 8332 form giving your ex the deductions he is entitled to.

2. If your ex has the most over nights, he has to sign an 8332 form giving you the deductions you are entitled to. If he refuses, you have to to back to court to get a court order - so you'll have to convince the court that you meet the requirements.

What you're doing now isn't really legitimate (each of you taking the deductions you think you're entitled to, but no 8332 forms being signed). If you aren't both taking the same dependent, you almost certainly won't get caught, but it's really better to have the 8332 form.

mistoffolees said:

It's not an IRS issue. The IRS couldn't care less how many hours or days you worked. They only want to know how much money you earned.

Let's go back to basics. As far as the IRS is concerned, the parent who has primary physical custody (the most overnights) gets the deduction. If you both have the same number of overnights, there are tie-breaker rules.

The only way to change that is by having the person who is entitled to the deduction by IRS rules to sign an 8332 form which gives the deduction to the other person.

So, there are two scenarios:
1. If you are entitled to the deduction by IRS rules (most overnights), then you are entitled to all 3 deductions. You would then sign an 8332 form giving your ex the deductions he is entitled to.

2. If your ex has the most over nights, he has to sign an 8332 form giving you the deductions you are entitled to. If he refuses, you have to to back to court to get a court order - so you'll have to convince the court that you meet the requirements.

What you're doing now isn't really legitimate (each of you taking the deductions you think you're entitled to, but no 8332 forms being signed). If you aren't both taking the same dependent, you almost certainly won't get caught, but it's really better to have the 8332 form.

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Actually they could get caught. The IRS has just added 5000 new auditors whose sole purpose is to audit returns with children on them, to ensure that the correct person is claiming the children as dependents.

I will also add, for clarity, that the person who is the non custodial parent (the parent with the least number of overnights) may NEVER claim Earned Income Credit or Daycare Credits for the children...no matter what the divorce decree states.

LdiJ said:

Actually they could get caught. The IRS has just added 5000 new auditors whose sole purpose is to audit returns with children on them, to ensure that the correct person is claiming the children as dependents.

I will also add, for clarity, that the person who is the non custodial parent (the parent with the least number of overnights) may NEVER claim Earned Income Credit or Daycare Credits for the children...no matter what the divorce decree states.

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Thank you for that information. Where can I get that in writing? I'm assuming somewhere in IRS code, but you seem to be familiar and can point me in the right direction. Your word is good enough for me, but most certainly won't be for the children's father. He has been claiming 2 children for the past 6 years, and has never had physical custody.

Also - is it possible to get my initial question answered? Do I HAVE to jump through hoops to prove I worked over 35 hours/week in 26 weeks to satisfy his attorney?

mistoffolees said:

It's not an IRS issue. The IRS couldn't care less how many hours or days you worked. They only want to know how much money you earned.

Let's go back to basics. As far as the IRS is concerned, the parent who has primary physical custody (the most overnights) gets the deduction. If you both have the same number of overnights, there are tie-breaker rules.

The only way to change that is by having the person who is entitled to the deduction by IRS rules to sign an 8332 form which gives the deduction to the other person.

So, there are two scenarios:
1. If you are entitled to the deduction by IRS rules (most overnights), then you are entitled to all 3 deductions. You would then sign an 8332 form giving your ex the deductions he is entitled to.

2. If your ex has the most over nights, he has to sign an 8332 form giving you the deductions you are entitled to. If he refuses, you have to to back to court to get a court order - so you'll have to convince the court that you meet the requirements.

What you're doing now isn't really legitimate (each of you taking the deductions you think you're entitled to, but no 8332 forms being signed). If you aren't both taking the same dependent, you almost certainly won't get caught, but it's really better to have the 8332 form.

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I have the most overnights, but as I stated in my original post, our decree states who gets to claim which child in which years. What takes precedence?

BalloonGirl said:

I have the most overnights, but as I stated in my original post, our decree states who gets to claim which child in which years. What takes precedence?

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As I explained, the IRS doesn't care what your decree says. The IRS has its own rules and will follow those rules and the divorce court can not overrule the IRS.

So, as far as the IRS is concerned, you get ALL the deductions if you have the most overnights. It is then up to you to follow the court order and sign the 8332 form(s) for the child(ren) who your ex is entitled to get the deduction for based on the divorce decree.

If your ex feels that he is entitled to a specific deduction and you do not file the 8332, then he would have to go back to court to ask the court to order you to file the 8332. It would then be up to you to prove to the court that you had met their requirements for keeping the deduction.

BalloonGirl said:

Also - is it possible to get my initial question answered? Do I HAVE to jump through hoops to prove I worked over 35 hours/week in 26 weeks to satisfy his attorney?

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I answered your question. Read my first response carefully.

mistoffolees said:

I answered your question. Read my first response carefully.

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Yes, indeed you did.

I'm sorry - I didn't read it completely through, mea culpa, mea culpa.

How would you suggest I respond to his email? Can you help me with wording so to not anger him? (Well, he will be angry no matter what, but maybe a bit less angry?)

BalloonGirl said:

Yes, indeed you did.

I'm sorry - I didn't read it completely through, mea culpa, mea culpa.

How would you suggest I respond to his email? Can you help me with wording so to not anger him? (Well, he will be angry no matter what, but maybe a bit less angry?)

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I would simply state that you have met the conditions for taking the deduction for xx child and will do so in the coming tax year. I would also enclose an 8332 form giving the IRS permission to give him the deduction(s) that he is entitled to.

Although, if it were me, I would make sure I filed my taxes as quickly as possible and not send him the above letter until then.

mistoffolees said:

I would simply state that you have met the conditions for taking the deduction for xx child and will do so in the coming tax year. I would also enclose an 8332 form giving the IRS permission to give him the deduction(s) that he is entitled to.

Although, if it were me, I would make sure I filed my taxes as quickly as possible and not send him the above letter until then.

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Thank you - can I trouble you with one more question?

How far back can I file an amended return for the EIC?

BalloonGirl said:

Thank you - can I trouble you with one more question?

How far back can I file an amended return for the EIC?

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You can still file an amended return for 2006, 2007 and 2008. 2006 will expire on April 15th, 2010.

Use a tax professional and explain very clearly that you only want to claim the child for EIC and head of household purposes. That you are NOT claiming the child as a dependent.

For 2009, you will be able to claim all three children for EIC and head of household purposes.

LdiJ said:

You can still file an amended return for 2006, 2007 and 2008. 2006 will expire on April 15th, 2010.

Use a tax professional and explain very clearly that you only want to claim the child for EIC and head of household purposes. That you are NOT claiming the child as a dependent.

For 2009, you will be able to claim all three children for EIC and head of household purposes.

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Thank you for the advice - you just made my day, which is a very tall feat today.

Do you agree with Mist's advice in responding to their dad and that the IRS rules trump the divorce decree over claiming the kids?

Thanks

BalloonGirl said:

Thank you for the advice - you just made my day, which is a very tall feat today.

Do you agree with Mist's advice in responding to their dad and that the IRS rules trump the divorce decree over claiming the kids?

Thanks

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Not entirely. Yes, the IRS rules trump the divorce decree but dad can still take you to court for contempt and you can be otherwise sanctioned by the state court judge.

However, Misto isn't suggesting that you violate the divorce decree. He is telling you to claim the other child you are entitled to claim under the divorce decree, because the IRS will back you up.

Dad's claim that you have to prove it to him, and that your second job doesn't count is BS. The only person you have to prove it to is the judge, and that is only IF dad files for contempt.