Taxes may be your last concern in a divorce, but it is a reality that you will eventually need to face. One question you may have is about who can deduct your children by counting them as a dependent. Don't make the wrong assumption that the parent with legal custody gets this tax deduction, since the deduction could be split. Here is what you need to know.
Consider How Long The Child Lives At Your Place
You should be keeping track of the amount of days that a child spends at your place and your former spouse's place. If your child is spending at least 183 days at your home, or more than half the year, then you will most likely have the right to claim them as your tax deduction.
There are exceptions to this rule though. What you need to keep in mind if the non-custodial parent pays much more than the parent who the child primarily lives with. It's possible to fill out the paperwork that will give the other parent the ability to claim their child as a dependent. If they are paying more out of their own pocket, they'll most likely need the tax break.
Consider How Old Your Child is
The IRS will let you claim your child as a dependent if they are 18 years old or younger. If they are going to college, the age limit gets bumped up to 24 and under. Of course, you should only claim a child as a dependent if they truly depend on you for care as a college student. If they are doing it all on their own, they deserve the tax credit.
Consider Your Child's Income
A big factor that separates a college bound child from dependent status is how much money they make. They may have a job and be putting money away in savings, but are you still paying for their rent, utilities, food, gas, and other expenses? If so, that gives you the right to claim the child on your taxes.
Dividing Dependent Deductions
If you and your former spouse split responsibility for your child evenly, there are options for splitting the deduction. The best way to do this is to come to a mutual agreement on who can deduct the child, and alternate tax years with who can claim them. If you have 2 children, it may be as simple as each of you claiming one child on your taxes.
For more tips regarding taxes after your divorce, be sure to ask your divorce attorney, one like http://www.chesapeakevalawyer.com.