Divorce & the Dependency Exemption

Now that tax season is just around the corner, our clients are naturally asking questions about divorce and taxes, specifically about which parent can claim the dependency exemption for their children.

When a couple with minor children divorces, one of the parents will be allowed one exemption for each qualifying child that they can claim as a dependent. In order for a child to "qualify" under the Internal Revenue Service's rules, they must be:

  • A biological son or daughter
  • A stepchild
  • A foster child
  • The child must be under the age of 19

After the divorce is finalized, can the noncustodial parent claim the dependency exemption for their children? As a general rule, the answer is "no."

Only one of the parents can claim the child-related tax benefits for their children, including the dependency exemption and the dependent care credit, however, there are exceptions for the dependency exemption.

How a Noncustodial Parent Can Claim the Dependency Exemption

What is the exception? If the divorced or separated parents have been living separately for the last 6 months of the year, the noncustodial may claim the dependency exemption for his or her children on one condition: the custodial parent agrees to let the noncustodial parent take the exemption.

How does the IRS determine who the custodial parent is? The custodial parent is the one that the child has spent more time with over the course of the year, and typically the custodial parent is the one that receives child support while the noncustodial parent is the one that pays child support.

If the custodial parent agrees to let the noncustodial parent claim the dependence exemption for the former couple's children, then the custodial parent would have to sign a Form 8332, stating that he or she will not claim the children as dependents for the year, and the noncustodial parent would have to attach the signed form to their tax returns.

If you have further questions about how divorce affects the way you file your taxes, don't hesitate to contact a San Diego divorce lawyer from Claery & Hammond, LLP!