Dependent Care Expenses

If you are the custodial parent, you can the Head Of Household status, Child Care Credit and EIC, even if he claims dependency.

The questions are tricky.

Dependency Questions/Non-custodial parent

What's Megan's relationship to you?

We know Megan is_, but we have to ask: Did she pay for most of her living expenses?

Do you have an agreement with Megan's other parent about who can claim her?

Is Megan's other parent claiming Megan per your legal agreement?

Are you letting Megan's other parent claim Megan for 2020?

Head of Household Questions/Custodial parent

What's Megan's relationship to you?

How many months did Megan live with you in 2020?

Where did Megan spend the most nights in 2020?

Did a relative live in your home and help support Megan?

If you are the custodial parent, the other parent can't claim EIC. If you are not divorced or separated, you can't split benefits for the child. If you are divorced or separated, you have a set of rules by which the IRS allows you to split benefits for your child. There is no 50/50 split. The parent the child lives with over half the time is the custodial parent. That parent gets all the benefits for the child, unless they choose to release the claim of exemption or are required to allow the noncustodial parent to have the exemption.

The EIC, and Child Care Credits can only be claimed by the custodial parent (in the home where the child actually lived.) It is not uncommon for the custodial parent (the one the child spends more than half the year with) to claim Head of Household and some potential credits (EIC, Child Care) while the non-custodial parent claims the dependency exemption and Child Tax Credit

Custodial parent and noncustodial parent.   The custodial parent is the parent with whom the child lived for the greater number of nights during the year. The other parent is the noncustodial parent.

  If the parents divorced or separated during the year and the child lived with both parents before the separation, the custodial parent is the one with whom the child lived for the greater number of nights during the rest of the year.

  A child is treated as living with a parent for a night if the child sleeps:

• At that parent's home, whether or not the parent is present, or
• In the company of the parent, when the child doesn't sleep at a parent's home (for example, the parent and child are on vacation together).

Equal number of nights.   If the child lived with each parent for an equal number of nights during the year, the custodial parent is the parent with the higher adjusted gross income (AGI).