Dependent exemption

[Zee]

Natural father is divorced from natural mother. Child lives with stepmother seperated from natural father, who was granted custody. Stepmother pays all support and child lives with her 100 percent of time. Stepmother has taken dependency exemption, but recently learned natural mother has also taken child as a dependent. She has provided no support.

Is the stepmother entitled to the deduction? How should this be resolved with IRS (they have not questioned yet$?

Thanks so much for the help?

[David1980]

Could the child be a qualifying child of the natural mother? The obvious problem for natural mother is likely the residency test. You indicate the child lives with stepmother 100% of time. Is that 100% of time for the tax year in question or 100% of time after some date? Obviously if child lived with natural mother for first half the year and 100% of the rest of the year with stepmother the 100% doesn't mean much. Or, if stepmother and natural mother shared residence for some of the year it could be a qualifying child of both.

I'll assume the child spent no time with natural mother.

Since natural mother and father are either divorced or separated the child would only need be in custody of one of the parents for more than half of the year. If natural father lived with child during the year that could qualify the natural mother under the special rules for divorced/separated parents. Natural mother would be considered non-custodial parent and subject to requirements on that, but possible.

I'll assume the child spent less than half the year with natural father. In that case, the natural mother can't meet the residency test for qualifying child and is looking at qualifying relative. If step mother can qualify under qualifying child rules natural mother would fail at minimum the not a qualifying child test.

So let's say both natural mother and step mother claim child. What happens? Well, potentially a tax return gets rejected for child already claimed - just file it on paper. Expect a letter. Birth certificate of child & marriage certificate between step mother and natural father should show relationship. Then need other documents to show residency. See http://www.eitc.irs.gov/EITCCentral/F866-H-DEP-2012.pdf

[MDEA]

Dependent exemption

They both could not have e-filed the second one to file would have been rejected.IRS would never have processed both returns with same dependent.They will send letters asking both to prove dependency.Since the birth mother can not.IRS will remove the dependent.

[Zee]

Natural father did not live with stepmother entire year (they are aldo seperated). Child lived with and was supported by stepmother entire tax year.

Thanks for the replies!

[David1980]

Natural father did not live with stepmother entire year (they are aldo seperated). Child lived with and was supported by stepmother entire tax year.

Thanks for the replies!

Separated or divorced? I guess multi-year separations while still married are not that uncommon these days. (Only reason I thought perhaps step mother and natural father lived together was the use of separated - I'd expect divorced after an entire tax year.)

[Zee]

Separated or divorced? I guess multi-year separations while still married are not that uncommon these days. (Only reason I thought perhaps step mother and natural father lived together was the use of separated - I'd expect divorced after an entire tax year.)

Seperated. So, is the stepmom entitled to the deduction if seperated from the natural father (child is with her all the time and she provides full support)?

I would appreciate others thoughts as well. Thanks.

[TaxGuyBill]

The child is the "qualifying child" of the stepmother.
The child did not live with the natural mother, so the child is NOT the qualifying child of the natural mother.

The tricky thing is to "prove" who the child lived with. Look at Form 886-H for how to prove it.

IRC 152(f) indicates that a "child" includes a stepchild for dependency purposes.
Reg. 152-2(d) indicates that the stepchild's eligibility for dependency "will not terminate by divorce". So even if the stepmother divorces the father, the stepmother can still claim the child (assuming it's the same situation).

[Zee]

The child is the "qualifying child" of the stepmother.
The child did not live with the natural mother, so the child is NOT the qualifying child of the natural mother.

The tricky thing is to "prove" who the child lived with. Look at Form 886-H for how to prove it.

IRC 152(f) indicates that a "child" includes a stepchild for dependency purposes.
Reg. 152-2(d) indicates that the stepchild's eligibility for dependency "will not terminate by divorce". So even if the stepmother divorces the father, the stepmother can still claim the child (assuming it's the same situation).

That makes sense. Thanks!