I have a lot clients who are divorced and they share (every other tax year) exemption of their child/ren. This is done by way of Form 8332 Release of Claim to Exemption for Child of Divorced or Separated Parents.

            This is a pretty basic information form, but one that gets both abused and ignored. A lot of divorced parents aren’t even aware that it exist. Usually because they never really explain their situation fully to their preparer or they are still doing their own returns, not knowing what this is.

            If you are a custodial parent, you can use this form to release your claim to a dependency exemption for your child/ren. What this does, in-turn gives to the noncustodial parent the exemption.  It will also give them the child tax credit and the additional child tax credit, should either apply to their situation.

To check qualification of a dependent child, check the rules for who is a dependent child. The noncustodial parent may be able to claim the child/ren if the “Special rule for children of divorced or separated parents” applies. {An easier read is on the Form 8332 instructions which  are part of the form}

(It isn’t as complicated as it looks but know what is happening here.)

                        By completing this form the custodial parent agrees not to claim the exemption or any of the credits they may otherwise qualify for concerning the child. The custodial parent may claim Head of Household so long as they still meet the qualifications for that filing status.

Check your filing status.

            A lot of people in this situation, divorced with child, are aware of this form and use it as it suits them when it suits them. Some make a play on words and in their mind they can let just anyone claim the exemption for the child by using this release. A major key in all of this is “the Parents.” This form doesn’t work for Aunts, Uncles, brothers, sisters (to the parents), grandparents, or your neighbors. This release is for the parents.

                                    -If you don’t know, it doesn’t help you. Research, ask questions.

Non-custodial parent claiming the exemption, you are supposed to send this form in with your return.

In closing I want to inform you of one last thing, this form can be used for more than one child. If you have two or more children you can use the same form.

For more information please see:

Form 8332 Release of Claim to Exemption for Child of Divorced or Separated Parents

Publication 501, Exemptions, Standard Deduction, and Filing Information

Frequently Asked Tax Questions And Answers Keyword: Divorced or Separated Spouses/Parents

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