Eic & Hoh

[gman]

Daughter lived with father entire year, but divorce decree states dependency exemption to be alternated between parents. Can father claim daughter for HOH & EIC if daugther lived entire year with him.

[okie1tax]

Qualifying child

Please see here - http://www.irs.gov/publications/p504/ix01.html

[gman]

yes,

I have read that and my determination was that father is eligible for both EIC & HOH, but want some reassurance, which is why I posted. Child is 18 so not eligible for the Child tax credit.

[okie1tax]

Eic & Hoh

Yes he can...

[MilTaxEA]

Custodial parent (who the child spends the majority of the year with) *always* gets to clain HoH, EIC, and dependent care credit. When you release a child to the non-custodial parent, you are releasing the dependency exemption and Child Tax Credit.

[dtlee]

Not sure if this applies here, but it should be noted that the "custodial" parent ceases to be the custodial parent for Form 8332 purposes in a year where the child reaches the age of majority under state law prior to the middle of the year. Depending on the state and the birthdate of the child, the taxpayer may be eligible for more than Head of Household and the EIC, despite what the divorce decree does or does not state.

Here is an excerpt from TC Memo 2007-324

Petitioner also does not qualify for the deduction under the special support test for children of divorced parents. Sec. 152(e)(1). Section 152(e)(1) applies only when the child is in the custody of one or both parents for more than one-half of the calendar year. We have held that once a child reaches the age of majority under State law, she is no longer in the custody of either parent for purposes of section 152(e). Ferguson v. Commissioner, T.C. Memo. 1994-114 [1994 RIA TC Memo ¶94,114]; Kaechele v. Commissioner, T.C. Memo. 1992-457 [1992 RIA TC Memo ¶92,457]. Petitioner's daughter was a resident of Virginia in 2003, and under Virginia law an individual reaches the age of majority when she becomes 18 years of age. Va. Code Ann. sec. 1-204 (2005). Petitioner's daughter became 18 years of age in March 2003, and therefore could not be in the custody of either parent for more than one-half of the calendar year.

Not sure of the circumstances in this situation since some states (like Massachusetts) have very different rules for the age of majority.

[Gary2]

Not sure if this applies here, but it should be noted that the "custodial" parent ceases to be the custodial parent for Form 8332 purposes in a year where the child reaches the age of majority under state law prior to the middle of the year. Depending on the state and the birthdate of the child, the taxpayer may be eligible for more than Head of Household and the EIC, despite what the divorce decree does or does not state.

Here is an excerpt from TC Memo 2007-324 Not sure of the circumstances in this situation since some states (like Massachusetts) have very different rules for the age of majority.

Notwithstanding the court's sloppiness in this decision, if you look back at the underlying decisions quoted there, you'll see that the key factor is whether or not the child is emancipated, not the age of majority. Massachusetts has rules similar to other state with regard to 18 being the age of majority (i.e. the right to vote and enter into contracts), but it has different rules concerning emancipation (i.e. the obligation of parents to care for the child, which can be later).

[dtlee]

Notwithstanding the court's sloppiness in this decision, if you look back at the underlying decisions quoted there, you'll see that the key factor is whether or not the child is emancipated, not the age of majority. Massachusetts has rules similar to other state with regard to 18 being the age of majority (i.e. the right to vote and enter into contracts), but it has different rules concerning emancipation (i.e. the obligation of parents to care for the child, which can be later).

Gary.

I remembered that for Massachusetts, the rules extend this rule well beyond 18 and into the college years for many students. Thank you for the correction/clarification.