HOH for parents who are divorced but live together

[BP.]

higher income takes the kids

Another tiebreaker rule. TTB has a nice new chart this year on dependency. Page 3-15, Qualifying Child of More Than One Taxpayer. It says parents can chose.

[Gary2]

Sorry but two adults in the same household, sharing expenses, do not qualify for HOH. Both file S and higher income takes the kids unless there are more issues to consider.

We've already addressed the notion of "sharing expenses equally", but you seem to be saying that it doesn't matter how they share, i.e., if one pays 2/3s of the household expenses and the other pays 1/3, then you're saying that the one paying 2/3 can't get HoH. On what do you base that?

[Gary2]

I think I found the answer to my question. Under the tiebreaker rules if the children live with both parents equally, the children are the qualifying child of the parent with the higher AGI. In this case, that is the mother. So if I understand the rules correctly she can qualify for EIC even though she is not HOH. Please correct me if I am wrong. Thank you!

That's not precisely correct, though it doesn't affect your result.

This particular tiebreaker rule only applies if both parents claim the child. If one parent agrees to let the other claim the child, then the AGI doesn't matter. This can be found as example 9 under the tiebreaker rules in Pub. 501, page 17.

[taxea]

Sorry but two adults in the same household, sharing expenses, do not qualify for HOH. Both file S and higher income takes the kids unless there are more issues to consider.

[DonB]

Correct in my book--

[Gretel]

Yes, mother can claim EIC with single filing status.

[kamckinley]

I think I found the answer to my question. Under the tiebreaker rules if the children live with both parents equally, the children are the qualifying child of the parent with the higher AGI. In this case, that is the mother. So if I understand the rules correctly she can qualify for EIC even though she is not HOH. Please correct me if I am wrong. Thank you!

[kamckinley]

Just a quick update on this thread...

Talked with the couple again and confirmed a few things:

House is in the father's name only, he pays all mortgage and house expenses.
Divorce agreement says mother claims their two children together (every year, no alternating between mother and father).
Father has a child of his own that he has sole custody of.

So, just to confirm the correct treatment:

Father is HOH and gets all house deductions. He qualifies for child tax credit and earned income credit for the child that is his alone.
Mother files as Single and gets no house deductions. She qualifies for CTC, EIC for the two children that they share, even though she is not HOH.

Is this correct? I am concerned about the EIC for the mother. Since the mother and father live together, the two children they have together can be qualifying children of either parent. Does that disqualify the mother from taking the EIC? If they didn't live together the children would be with the mother, but since they live together, they are both custodial parents. Ugh! I don't do many EIC tax returns, so this one is really stumping me.

Thanks again for all the comments, I appreciate the help!

[dtlee]

Taxea, I think you are being a tad harsh. If one spends one penny more than the other, then that person is H of H. If they both agree that A spent one penny mor than B then A is H of H.

Actually it isn't that harsh.

I have had clients insist that neither paid more and that everything was evenly and exactly split down the middle exact to the penny.

After explaining multiple times what the rules are and having them insist that everything was exact, if you tell them, "Fine, then both of you can only file as single," one of them will quickly remember the screw they bought or the key they had made or the box of Girl Scout Cookies that enables one of them to claim Head of Household.

[Kram BergGold]

A Bit Harsh

Taxea, I think you are being a tad harsh. If one spends one penny more than the other, then that person is H of H. If they both agree that A spent one penny mor than B then A is H of H.

[taxea]

Neither can file HOH if they live together and share the expenses.

[Lion]

He/she has to be legally obligated to pay (mortgage interest &/or property taxes) and has to actually pay. So, if they each pay 50/50 and are on the mortgage and are owners, then that's how you split it. But, if she paid 79%.... Follow the money.

[kamckinley]

They are both still on the mortgage and title to the house. Thanks!

[DonB]

Who owns the house and is named on the mortgage? If she is off the title and mortgage, he would claim the house deductions.

[Gretel]

Splitting the mortgage interest and property tax 50/50 is probably a reasonable way to do it, if they both contributed to the payment of those expenses.

BMK

Maybe, but we do not know who the legal owner of the house is.