It seems pretty simple, at least on the surface. You have a child, they live with you at least some of the time, so they're your dependent at tax time, right? Not exactly, and you certainly wouldn't be the first parent or the last—to claim your child as your dependent only to find out that your ex has already done so.
It happens often enough that the Internal Revenue Service has special "tiebreaker" rules to help you determine which of you actually has a right to the dependency exemption.
The Tiebreaker Rules
The IRS indicates that the parent who can claim a child is the one who meets the following criteria:
First, the claim goes to the parent with whom the child lived most during the tax year. The IRS year defines this by "overnights"—nights where they went to bed in one parent's home or the other. This generally means that the dependency exemption goes to the custodial parent—the parent who has legal custody of the child by court order.
Assuming the child did spend exactly the same amount of time in each parent's home during the tax year—or maybe the parents live together but can't or don't file a joint married return—the tiebreaker rules give the dependency exemption to the parent with the highest adjusted gross income.
If someone other than a parent is trying to claim your child, they're out of luck. A parent always has the first right to claim their child as a dependent if they're able to do so. The IRS gives a detailed explanation of circumstances under which neither parent might be able to claim their child in Publication 504. It's rare, but it does occasionally happen.
Does Claiming Your Child Affect Your Tax Situation?
Claiming your child as a dependent can save you some tax dollars if you meet the requirements.
The passage of the Tax Cuts and Jobs Act (TCJA) eliminated personal exemptions from the tax code—the exemptions you could claim for yourself and each of your dependents—for tax years 2018 through 2025. But claiming a dependent can qualify you for several advantageous tax credits and tax deductions, and it can affect your filing status, which can create other tax reductions.
Most TCJA tax provisions expire in 2025. Congress might or might not reinstate personal exemptions at that time.
It will trigger an IRS audit using the tiebreaker rules to determine who gets to claim the child if both you and your ex are file returns claiming them and neither of you is willing to amend your return to reverse the claim.
You Can Relinquish Your Claim
A custodial parent can give the noncustodial parent the right to claim their child by signing Form 8332. Your ex can submit it with their tax return. You should sign this form for every year you plan to relinquish the exemption claim. You might want to do this if it provides them with a tax break but has no effect on your tax situation, particularly while personal exemptions are repealed.
You can always resubmit the form to revoke the release if you change your mind.
Who Else Might Have Claimed Your Child?
The IRS can't tell you who claimed your dependent because it's prohibited by Section 6103 of the Internal Revenue Code. The agency can't disclose information relating to a tax return to anyone other than the filer. That said, you probably have a good idea of who claimed your child. The culprit would have to have the child's name, their Social Security number, and their date of birth.
But it isn't always the child's other parent who claims them. Maybe your ex and your child are living with another relative and that relative thinks they're entitled. Identify theft is a problem as well—someone might have stolen your child's Social Security number and is using it to steal money from the U.S. Treasury.
What to Do?
Print out your tax return listing the correct dependents and file the return with the IRS if your child has been claimed by someone else. You'll have to mail the return for manual processing because IRS computers are programmed to automatically reject e-filed returns that include a dependent who has already been claimed on another tax return.
Attempting to file electronically will only cause an unnecessary and additional delay in straightening the situation out.
The next step is to prepare yourself for an audit over the dependent if the individual who claimed your child won't file an amended return revoking the claim. The IRS will audit both your tax return and the return of the other person. They'll ask questions and seek documentation based on the eligibility criteria and the tiebreaker tests.
Gather any and all records indicating that your child lived with you and when. Ideally, you have a custody order or agreement detailing exactly when your child resides in your residence. School and medical records can also be helpful, as can any kind of journal, diary, or calendar that cites the days your child lived with you.
Having these records will go a long way toward winning the audit and protecting your tax refund.