Child tax credit

[George Cornici]

TP is divorced and remarried. From the first marriage he has two children under 17. They live with their mother who has custody. TP is still paying child support. By court decision they are TP's dependents.

Do the TP qualify for CHILD TAX CREDIT? I know that one requirement is RESIDENCE TEST. But ATX software at line 6(dependents) has a column titled "Check if the child did not live with you because o divorce or separation" And if you check that of course the refund is changed accordingly.

Please anybody give me an answer/Thank you/gc

[elabre]

TP is divorced and remarried. From the first marriage he has two children under 17. They live with their mother who has custody. TP is still paying child support. By court decision they are TP's dependents.

Do the TP qualify for CHILD TAX CREDIT? I know that one requirement is RESIDENCE TEST. But ATX software at line 6(dependents) has a column titled "Check if the child did not live with you because o divorce or separation" And if you check that of course the refund is changed accordingly.

Please anybody give me an answer/Thank you/gc

George,

Your client's dependents satisfies two of the three requirements under the uniform definition of a child - age and relationship. However, the third requirement is not met. To pass the residency test, the child must have the same principal place of abode as the taxpayer for more than half of the tax year.

In order to qualify for the child tax credit, the child must meet all three requirements. This became effective for years after 2004.

Gene

[George Cornici]

I am still not convinced. Why?

1) I got a different answer verbally today from a tax proffesional w/much ecperience

2) How do you see the following quote from IRS:

Topic 606 - Child Tax Credits

You may be able to claim a child tax credit if you have a qualifying child.

"A child is your qualifying child if the child:

Is a citizen, resident, or national of the United States,

Is under age 17 at the end of the calendar year in which your tax year begins,

Is your son, daughter, stepson, stepdaughter, legally adopted child (or a child lawfully placed with you for legal adoption), brother, sister, stepbrother, stepsister, foster child placed with you by an authorized placement agency or by a court order, or a descendant of any such person,

Shares with you the same principal place of abode for more than one-half of the tax year, or is treated as your qualifying child under the special rule for parents who are divorced, separated, or living apart, and

Is not treated as the qualifying child of another taxpayer under the special rule for two or more taxpayers claiming a qualifying child or the special rule for parents who are divorced, separated, or living apart"

Myself? I tried to get information reading a lot about this subject but it is so confusing. So, I am stiil waiting for the right answer/gc

[SCL]

off the top of my head - fwiw.

3rd or 4th year of new dep story - keep reading.

need to claim dep to get c tx cr (off the top part).

need release of claim from custodial mother.

[George Cornici]

Yes sir, I will keep reading to the end of my life. We keep learning our entire life. But it is amazing(!!!) how on a tax forum one can give double standard answers like yours. It seems that you know the answer but still you advice me to keep reading. Thank you and have a nice day.

[George Cornici]

off the top of my head - fwiw.

3rd or 4th year of new dep story - keep reading.

need to claim dep to get c tx cr (off the top part).

need release of claim from custodial mother.

SECOND REPLY:

"Need release of claim from custodial mother" .....????...Why is that necesarry when there is a court decision on dependency?

[Jack from Ohio]

SECOND REPLY:

"Need release of claim from custodial mother" .....????...Why is that necesarry when there is a court decision on dependency?

The IRS is not bound by the court decision on dependency. The IRS will use its regulations to determine dependency qualifications. Without the signed 8332 the non-custodial parent will lose in a dispute.

This information is from first hand audit experience in our office.

[grandmabee]

The IRS is not bound by the court decision on dependency. The IRS will use its regulations to determine dependency qualifications. Without the signed 8332 the non-custodial parent will lose in a dispute.

This information is from first hand audit experience in our office.

Also, its a STATE court and you are filing a Federal tax return. Feds do not have to abide by the state court rules

[Tax Prep by Deb]

As to why Atx program has that box to check I think goes back to info that relates to prior 1985 divorce decree. I do believe from 1986 forward Fed's rules (I.R.S.) favors non-custodial parent, where as prior to 1985 it was whatever was stated in the decree. I'm not 100% sure on this as I started preparing taxes in the early 90's.

Deb!

[Cajun Sue]

Please read instructions for line 6c in the 1040 instruction booklet..Page 16...Definitions and Special Rules--Children of divorced or separated parents...

There it says that a child does NOT have to live with the parent (non-custodial) for him/her to be able to claim the CTC, if he claims the child as a dependent using the rules of divorced parents.. The Non custodial parent cannot claim Child Care , EIC or Head of Household, however. Only the custodial parent may do that.

Also, on this page are the rules for Filing with the 8332 form or the divorce degree.