Qualifying child issue - Form 2441

[Gary2]

IMPORTANT NOTE:

There is no way, shape, or form that the grandparents EVER could factually prove they provided more than 50% of the child's support.

Why is that relevant? The support test for a qualifying child only requires that the child not be self-supporting. It doesn't matter in the slightest who does provide the support - as long as it's not the child.

This does not preclude the likelihood that they will (again!) try to claim the exemption for the grandchild - but they WILL lose on the facts. This battle is one they cannot possibly win, unless much "truth distortion" occurs. And my client is fully armed with the relevant facts/records.

The only thing the client might need to prove is the residency test based on the temporary absence rule, since the parental priority is automatic. I'm not sure how much of that proof is legal versus factual. Support, if relevant at all, will be secondary (e.g. the support provided by your client is evidence that there was clear intent that the absence was temporary, or that the placement with the grandparents was motivated by circumstances and not financial need). A copy of military orders may be the most significant record.

[oceanlovin'ea]

You can claim daycare expenses for whatever period of time you paid them. If only for 2 months, then for 2 months. Or if for the whole year, for the whole year. You can only get the credit on $3000 maximum anyway.

I think that is what part of the question was asking. Did it matter if the daycare was only for a few months.

Linda, EA

[taxea]

While the parent would have priority, if the grandparents' AGI is higher than the parent's, then the parent may allow the grandparents to claim the child as a dependent. It doesn't matter which one is actually supporting the child. If they do this, then it's possible the grandparents may qualify for the 2441 credit, even though the parent wouldn't.

In a divorce situation, the fact that a custodial parent may use child support funds for daycare doesn't change the child support into taxable income. If the non-custodial parent chooses to chip in a bit more than the divorce agreement requires, it's still not taxable income; worst case, it's a gift. I don't see why this would be any different.

If anything, daycare is a legitimate parental expense whether or not the expense qualifies for the credit. I don't see paying for daycare (or reimbursing the grandparents) as any different than the parent paying for the child taking music lessons or joining a sports or scouting club.

re your last paragraph...I was more thinking along the lines of paying the parents an additonal amount for the care like taking the child to a daycare center.
This would be in addition to the "support" he is providing.