Are there special rules for divorced or separated parents?
Generally, when the parents of a child live separate and apart, the custodial parent is the person who may claim tax benefits for the child, if all other requirements are met. However, with the Child Tax Credit (CTC), the custodial parent may waive the right to claim the child and give permission to the noncustodial parent to claim the child. To do this, the custodial parent must complete Form 8332 and provide it to the noncustodial parent, who files it with their tax return.
Even if the custodial parent waives the CTC, the custodial parent is still eligible to claim head of household status, the Earned Income Tax Credit, and the Child and Dependent Care Credit, because those credits are based on the child living with you for more than half the year. Of course, all other eligibility requirements, discussed below, must be met before you can claim these credits.
You can find out more information about the special rules for divorced or separated parents here. Because these rules can be complicated, you may want to talk to a reputable tax return preparer about your situation.
How can I prove that I am eligible for these tax benefits for my child or other dependent?
If the IRS questions your CTC, EITC, or other claim, you will need to send the IRS documents that prove your eligibility. Look carefully at each of the general rules for each provision below. Generally, to prove age a birth certificate or other official document showing date of birth will work. These documents may also help to prove your relationship to the child. School records, medical records, leases listing the occupants, SNAP records may all be used to prove relationship and residency. Sometimes it will take a combination of official documents and records or sworn statements by knowledgeable persons such as school officials, social workers, or doctors.
Eligibility for the Child Tax Credit (CTC):
Generally, you can claim a child for the CTC if the child meets all of these rules:
1. The child is your son, daughter, stepchild, eligible foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them.
2. The child was under age 17 at the end of 2020.
3. The child did not provide over half of their support for 2021.
4. The child lived with you for more than half of 2021 (but there are some exceptions to this).
5. The child is claimed as a dependent on your 2021 tax return.
6. The child does not file a joint tax return for 2021.
7. The child was a U.S. citizen, U.S. national, or U.S. resident alien. This means that the child must have a valid Social Security Number when the tax return is filed.
For Tax Year 2021, the Advance Child Tax Credit is fully refundable, meaning you can receive the entire amount of the credit even if you don’t owe any taxes; you also do not have to have any income to receive the credit for the 2021 Tax Year.
A $500 non-refundable credit, the Credit for Other Dependents (ODC), is available if you or your children do not qualify for the CTC. To claim a child under this credit, you must be able to claim the child as a dependent on your tax return. The child does not need to have a Social Security Number.
Eligibility for the Earned Income Tax Credit (EITC):
Generally, you can claim a child for the EITC if the child meets all of these rules:
1. The child was under the age of 19 at the end of 2021. Permanently disabled children can be claimed at any age, and full-time students can be claimed until they turn 24.
2. The child is your son, daughter, stepchild, adopted child, foster child, brother or sister, half brother or sister, step brother or sister, grandchild, niece, or nephew.
3. The child lived with you in the United States for more than half of 2021.
4. The child is not eligible to file a joint return for 2021.
5. The child was not claimed by another person as a qualifying child.
6. The child has a valid Social Security Number when you file your tax return.
7. You must have a valid Social Security Number when you file your tax return. If you are married and filing jointly with your spouse, your spouse also needs a valid Social Security Number when you file your tax return.
Eligibility for Head of Household Status (HOH):
Generally, you can file as Head of Household if you meet all of these rules:
1. You were unmarried or considered unmarried on the last day of the year.
2. You pay for more than half of the expenses of keeping up a home. These expenses include items like rent, utilities, food, and other household expenses.
3. A qualifying child or relative lived with you for more than half the year.
a. The child can be your child or grandchild.
b. If the child is married, you must be able to claim the child as a dependent on your tax return.
c. A qualifying relative can include your parent if you can claim that parent as a dependent on your tax return.
d. Certain other relatives can be qualifying relatives, including grandparents or siblings, if they meet additional requirements.
Eligibility for the Child and Dependent Care Credit (CDCC):
Generally, you can claim the CDCC if you meet all of these rules:
1. You (and your spouse, if you are married married) lived in the United States for more than half of 2021.
2. You paid someone to care for your child or another person so that you could work or look for work in 2021.
a. Your child was under 13 during 2021 and you can claim the child as a dependent on your tax return.
b. You can claim your spouse if your spouse was not able to care for themselves in 2021.
c. You can claim any other person who was not able to care for themselves in 2021 if you can claim that person as a dependent on your tax return.
d. The child or other dependent must have a valid Social Security Number or Individual Taxpayer Identification Number (ITIN) when the tax return is filed.
3. You can count some work-related payments you make to other relatives, even if they live in your house. But, don’t count any amounts you pay to:
a. A person you (or your spouse in the case of a joint return) can claim as a dependent;
b. Your child who was under age 19 at the end of the year, even if the child isn’t your dependent;
c. A person who was your spouse at any time during the year; or
d. The parent of your qualifying person if your qualifying person also is your child and under age 13.
In other words, if the caretaker is your dependent, your child, your spouse, or the qualifying person’s other parent, you can’t count payments made to them as caretaker.
4. You must provide the Caretaker’s Social Security Number or Employer Identification Number (EIN) when you file your tax return, using Form 2441, Child and Dependent Care Expenses.