11 answers

K.I. asks from Spokane, WA on April 15, 2009

Tax Time/question About Child Tax Credit?

Hello ladies!

Its tax time and I have a question to any of you out there who are divorced and each parent claims one child on their taxes...we had our taxes done last night(usually dont wait till last minute, but this year time got away from me) and we were told that we can not claim our oldest any more because the "computer" told the tax preparer that our oldest is too old? He turned 17 in Oct. of '08. The divorce papers say each parent claims one child...and I was wondering if this is just a divorce thing or what? I have always thought that you can continue to claim your kids as long as they are still in school(which ours is, he has a late birthday and will be 18 right after he starts his senior year)afterall we are still supporting him and he has no job? Any thoughts on this? This just came as a shock to us...seeing how for 10 months out of 2008 he was only 16 , and we can no longer get any type of child tax credit, EIC, etc???

I wouldn't be surprised if this was only for non-custodial parents---yet another way the system is set up to be not quite as fair to the Father---I tried asking the woman doing our taxes and she had to ask her supervisor, sadly they were not that knowledgeable---never again will I use them! (and they are the biggest/most recognizable tax co. out there)

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So What Happened?™

Thank you ladies for all your responses!----I am just glad it is done with and over. I am kicking myself in the butt for waiting to the last minute and making this situation more stressfull than it needed to be---Shame on me!

Information for any Non-custodial parents who are allowed to claim a child on their taxes:
I did my own research and here is the "whats what"---just because the divorce decree states that the non-custodial parent gets to claim a child doesn't mean that the custodial parent cant claim that same child for the EIC,etc. but if the custodial parent "might" claim for the EIC that means that the non-custodial can't. Therefor the non-custodial cant really claim said child to the fullest.---If you are the non-custodial parent and divorce papers say you get to claim a child you still have to have the custodial parent sign a Form 8332---which releases the custodial parent of any rights to claim that child for anything, making it so the non-custodial parent can!---You have to attach the Form 8332 to your tax return every year you intend to cliam that child.----Our old tax company just took our word for it that we could claim our kid, while this one WOULD NOT even though we gave them a copy of the divorce decree??? Lesson learned: Always double check!!

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L.J. answers from Seattle on April 16, 2009

Yes they changed the age to 17 now instead of 18
So hopefully more people will be aware, it was changed last year. Good-luck..L.

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T.C. answers from Portland on April 16, 2009

K. I,

It is correct. When your child is 17 yrs. they are not allowed to be claimed for the child tax credit. Only as a dependent.

Sorry,
T.

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L.J. answers from Seattle on April 16, 2009

Yes they changed the age to 17 now instead of 18
So hopefully more people will be aware, it was changed last year. Good-luck..L.

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J.W. answers from Seattle on April 16, 2009

You're still able to claim him as a dependent, but for the purposes of child tax credit, he has aged out of the system if has turned 17 during the tax year. Sorry. You're able to claim your child as a dependent as long as they are living with you, you provide for them and they don't claim themselves as an exemption on their taxes. Depending upon which state you live in, you can claim them as a child/dependent for health insurance up until they're 23 or 25, again depending on the state you live in. Washington State it's 25 yrs of age. After that, 'they' figure that they should be earning their own way and getting their own insurance plans. Take good care. Turbo Tax will also help you with this, you can get a copy of it at most warehouse, dept/variety stores, or office supply stores.

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B.B. answers from Portland on April 16, 2009

Holy cow, you are getting a lot of different answers!!! I prepare taxes and work for a CPA.
EIC, a dependent, and the Child Tax Credit are all different things entirely!
The Child Tax Credit goes away when the child turns 17 - that is not new in the last 10 years.
A person can still be your dependent even after 17, your parents could be dependents if the situation is right.
EIC is based on a number of things, 2 of them being your income level and number of children living with you.

Again - all different things, people tend to get them mixed up and when you start calling something by the other things name, people research the wrong area and get all upset.

Good luck

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J.W. answers from Richland on April 16, 2009

This came as as urprise to me too! I have sole custody as my daughter's father is deceased, and they stopped counting her when she turned 17. It doesn't seem fair. And just a word of caution if you plan to trade off with your ex- each claiming your younger child every other year. We did that before my ex passed away and then one year the IRS challenged my right to claim her. I sent all the documentation they assked for but it turned into a huge fiasco that lasted 4 years! In the end they finally paid me the credit I was owed but it was really frustrating.

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T.L. answers from Seattle on April 16, 2009

K.,

You will get to use him as a deduction as long as he is under 18 or longer if he is at school and you are providing more than 50% of his keep, but the child tax credit expires in the year that your child turns 17. These are two different things and it has nothing to do with the fact that you are divorced and splitting children up. Hope this helps.

Tracy

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V.B. answers from Seattle on April 16, 2009

Well I'm sorry to hear you had a bad experience there, but I have worked for Block for 6 years and we have a great group of people, very intelligent too. Some offices are better than others I suppose.

To take the child tax credit the child has to be under 17, here:

IRS Tax Tip 2009-45

With the Child Tax Credit, you may be able to reduce the federal income tax you owe by up to $1,000 for each qualifying child under the age of 17.

You can still claim his as a dependent you just don't get the tax credit. You can also have your credit amount reduced like my husband and I had as we made too much money last year. Hope this helps.

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D.H. answers from Seattle on April 16, 2009

EIC is different than claiming your child on your taxes. You can claim the child even after high school if they are in college and you support them. EIC is just a bonus until the child is a certain age. A very new thing. Wish they'd had that when I was raising my first 3. Anyway, I found out the hard way that if my EX didn't claim the kids that year, I could. If he did claim them that year, they just turned down my tax form and made me re-do it. In my case I had a bad attorney who gave my EX rights EVERY year to claim ALL of them, so I never got to claim anyone or get anything. Bad move on my part...but like I said, I started filing and claiming them late in the game and SURPRISE! some years he hadn't claimed them (out of work) and I was able to. Other years, I received a letter stating they had already been claimed. And that was fine too. Don't feel picked on as a divorced parent, because really in this case, we are all in the same boat. None of us can claim EIC after 17.

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V.D. answers from Seattle on April 15, 2009

http://www.hrblock.com/taxes/tax_tips/deductions_credits/...

this link should give you all the info you need about what qualifies as a tax claimable dependent

It seems to me like she may have done your return wrong. I would go somewhere and get a second opinion and if they agree, then you will need to file an amended return and I would try to push for them to cover the cost of that.

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H.G. answers from Portland on April 16, 2009

Looks like you found what you needed.

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J.K. answers from Bellingham on April 16, 2009

One of you should be able to claim the 17 year old!! Here is what the IRS says about dependents:

Your child who is: Under age 19 at the end of 2008, Under age 24 at the end of 2008 and a student, or Any age and permanently and totally disabled. The child also cannot have provided 1/2 of their own support and lived with you for 1/2 of the year.

My understanding has been that parents can make an agreement on who claims each child and file that way. I did find information in the 1040 tax publication that says there is a special rule for children of divorced/separated parents. Here is the link: http://www.irs.gov/pub/irs-pdf/i1040.pdf (The information is on page 18).

What it seems to be saying is that if parents are divorced, the child is under the ages above, and the parents (together in some fashion) were the ones paying for over 1/2 of the child's support, and the parents (together in some way) had custody of the child for at least 1/2 the year (i.e. child wasn't in foster care, etc...), then: one of the parents can claim the child.

It would be the custodial parent, unless the non-custodial parent can show the agreement otherwise in the divorce papers or the custodial parent gives the non-custodial parent a Form 8832...

Nothing really changes from the divorce with the dependency rules.. the IRS basically just makes sure that the child is still taken care of in the same way and that the divorce decree or parent agreement is followed.

If you've already filed your taxes, its okay. You can have them re-done and file a 1040x to make the changes.

I wouldn't go back to those people...they obviously don't know the basic rules of dependency.. maybe if you drop by the IRS office, they can give you some advice on how to fix it. They helped me when I married my husband and found out he hadn't filed (or paid) for six years.. (that was a mess!!)