When married couples file joint tax returns, they collectively claim their children as exemptions. Unmarried couples, however, are not able to file jointly, so there may be some uncertainty as to who can claim the children as dependents for tax purposes. In some couples, only one of the parents is a legally recognized parent, in which case that parent claims the exemption. In other relationships where both partners are legal parents, they agree on which parent will claim the exemptions, perhaps based on who will stand to gain the greatest financial benefit, who has the greater need for the exemption, or an alternating year-to-year schedule.
If couples can not agree on who will claim the children as exemptions for income tax purposes, and if there is no court order or legal agreement in effect that covers this issue, the Internal Revenue Service (IRS) provides five tests that determine who is entitled to claim the exemptions. The following questions, based on IRS guidelines, can help you determine who in your family can claim the children as exemptions.
The Member of Household or Relationship Test
Did the child you wish to claim as an exemption live with your for the entire year as a member of your household, other than during temporary absences by either of you due to illness, education, business, vacations, or military service?
Is the child related to you by birth or adoption?
If you answered yes to either or both of these questions, move on to the next test. If you answered no to both questions, stop here. You are not entitled to claim the child as a dependent/exemption.
The Citizenship or Residency Test
Was the child a U.S. citizen or resident, or a resident of Canada or Mexico, for some part of the tax year?
If you answered yes to this question, move on to the next test. If you answered no, stop here. You are not entitled to claim the child as a dependent/exemption.
The Joint Return Test
Can the child file a joint return with another taxpayer?
If you answered no to this question, move on to the next test. If you answered yes, stop here. You are not entitled to claim the child as a dependent/exemption. (Note: This situation generally arises only when the child is married.)
The Gross Income Test
Did the child earn less than $2,800 this tax year?
Was the child under age nineteen at the end of the year?
Was the child a student under age twenty-four at the end of the year?
If you answered yes to one or more of these questions, move on to the next test. If you answered no to all three questions, stop here. You are not entitled to claim the child as a dependent/exemption.
The Support Test
Did you provide more than half of the child's financial support during the year?
To calculate whether you provided half of the child's support, complete the following:
Is the amount of support you provided greater than the difference? If so, you provided more than half of the support for this child.
If you answered yes to this question and passed all of the tests above, you are entitled to claim the child as a dependent/exemption on your income taxes.
Have Tax Questions About Your Dependents? Get a Free Case Review
It can often be difficult for separated or separating parents to agree on child care and support and the thought of one more issue to resolve, especially one related to taxes, can seem overwhelming. Why not lighten your load by reaching out to a professional to help file the necessary tax forms and negotiate on your behalf, if needed. Reach out to a family law attorney today and receive a free initial case evaluation.