Who Gets to Claim the Kids for Tax Purposes?
Financial considerations such as the equitable distribution of property certainly loom large in divorce, but the tax implications of divorce tend to be discussed less often. It is understandable, then, for Florida parents to be left wondering who gets to claim children as a dependent for tax purposes.
This area of family law and tax law is quite complex, making it easy for well-intentioned parents to make tax mistakes. Here are a few tips that will help Florida parents obtain some clarity on which parent can claim children as dependents after a divorce.
Claiming Children As Dependents for Tax Purposes
If physical custody is awarded to only one parent, then only the parent with sole parental responsibility is permitted to claim the child or children as a dependent for tax purposes. This is true irrespective of how much money and financial support is provided by the parent without any parental responsibility rights. This is a rare occurrence, however, as it is more common for parents to be given shared parental responsibility and parenting time in Florida.
Florida courts are required by statute to award shared responsibility unless the court finds that awarding both parents with shared responsibility would not be in a child’s best interests. Shared parental responsibility is most analogous to the notion of joint custody, which is a 50-50 custody arrangement.
Without a doubt, it is 50-50 parenting plans that creates the most complex scenarios for claiming children as dependents. Parenting plans outlining how shared parental responsibility will work may not contain a written agreement detailing which parent can claim the children for tax purposes.
If no such agreement exists, both parents may want to claim the children, which is problematic since only one parent can claim the children as dependents in any given tax year. If parents cannot agree on who should claim the children as dependents, a fair remedy would be to alternate years so that each parent can claim the children every other year. Alternatively, if the parents have an even number of children (say, 2 or 4), it may make sense for each parent to claim the same number of children as dependents.
When parents with shared responsibility cannot agree on who can claim the children for tax purposes, then IRS tiebreaker rules can be used.
IRS Tiebreaker Rules
IRS tiebreaker rules dictate that a child will be treated as the dependent of the parent with whom they spent more nights with during the tax year in question. If a child lived with both parents for the same amount of time during the tax year in question, then the tie is broken by letting the parent with the higher adjusted gross income claim the child as a dependent.
Talk to a Florida Family Lawyer to Ensure You Are Prepared for Tax Season Post-Divorce
Establishing who can claim the child as the dependent is far from the only tax-related issue that can arise. While the parent who claims a child as a dependent is the only parent entitled to take the Child Tax Credit, Child’s Tax Exemption and similar benefits, there are also responsibilities that come with claiming the child as a dependent. For example, a parent who claims a child as a dependent will be responsible for any penalties under the Affordable Care Act (ACA) if the child does not have health insurance.
The complexities that arise when tax season and divorce intertwine requires the help of a Florida family lawyer to help families best navigate these tax-related issues and similar hurdles. Contact The McKinney Law Group for a legal consultation to learn more about how your Florida divorce can affect you during tax season.
If you have questions regarding Tampa family law, or are unaware as to the terms and conditions in, talk to, and retain, a family law attorney who can help. Contact Damien McKinney of The McKinney Law Group to discuss your case further. He can be reached by phone at 813-428-3400 or by e-mail at [email protected]