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Taxes

post #1 of 11
Thread Starter 
How do you handle them. STBXH want to each claim a kid and alternate which kid we each claim each year. We didn't get to court before the new year. Do we file joint for last year?
post #2 of 11

until there is a court order saying otherwise legally the primary custodian (51% or more) can claim all children.

most courts now will order a split of there are more than 1 child. in my case I claim younger and ex gets to claim older since he has the kids less.

if there is only one often it'll be a odd/even split.

 

wayyy back in the day my mom got to claim oldest 2 girls and my dad got to claim my younger brother for several years, but I think that changed before I was 18, i'd have to ask.

 

I'm going to be asking mediator to order that I get both kids when I go back in a few months to rehash some issues. #1 I got stuck with house because he couldn't afford it (I didn't want house to begin with) #2 I can file as head of household #3 I make 82K a year at my job #4 I was paying 1300/mth for daycare before kids started school and now with lil guy in kindy it's finally down to 700/mth and will continue until kids are old enough to be latchkey - so another 6+ years probably

 

Ex lives with his 2 parents and 29yr old sister who has never left home. He makes around 28K a year and pays 500/mth in child support.

Financially i'm doing the majority of support of the kids, he doesn't pay a dime towards daycare but has custody of the kids atleast 6 days i pay daycare for (70/day dropin is what they charge = 420) plus summer days when cost goes back up to like 1K a month.

we payed for home jointly for EXACTALLY 36 months. meaning at 50/50 he paid 18m of mortage.

 I just payed first month of my 6th year alone, meaning i've paid 79m of mortgage.

 

IMHO not only would I benefit from both kids deduction, but I should be entitled to it based on time split and cost of care.

we'll see how that goes.

 

but because we split in feb 5 years ago (he left me hanging with jan and feb mortgage to pay) and all we had was temp orders I filed and claimed BOTH kids that year because I was legally allowed to.

the following year we had orders in place and ex was able to claim older DS, but he has to have me sign a form every year to permit it.

post #3 of 11
Thread Starter 
I make squat and he makes the money. I just got a job as a teacher this fall and make 34,000 a year. That's what you get for staying home 9 years doing home daycare. I ran a daycare so the kids could be home and cloused it fall 2011 and worked as a substitute 2011-2012, while working on getting a real job. He has worked overtime for 10+ years as an ER nurse making 120,000 a year. He feels all the money he made working overtime is his to spend as he chooses. I just know he is going to spazzing about having to pay more taxes because he doesn't have the child tax credit.
post #4 of 11

well my ex would consider his xmas bonus (50 bucks) his, and half of my bonus one year (200) his, and half of all the side jobs i'd work as "his" too. for video games of course.

When I would say no, the extra 300 I made on a side job was going towards CC debt he would say "well, you can do that with YOUR half"

umm...no.

LOL.

 

legally whoever has them the majority gets them unless court orders diff. odds are you'll end up with same situation I have now. he claims older, you claim younger.

no sense in rotating them right now anyway. same price no matter what age.

 

and you can still claim daycare costs on both kids, even if you are only claiming the tax credit on one.

post #5 of 11

I would say it depends on your ex and your deductions/income but likely you would save money filing jointly. Since you were not yet divorced you can do it for 2012.

 

There are two deductions. There is a dependent and a credit. Things like childcare you can both claim if you both paid them. If one of you is high income and the other isn't (I think it was the credit) was not worth much (in my case it was only like $500 off my taxable income).

 

If you do not file jointly, the bigger tax savings is usually who can claim 'head of household' filing. Make sure if you have your kids most of the time to set your agreement up to be able to claim that. The tax rate is higher than the married one but lower than the single one. Also check your state laws since they might have some extra conditions. Some states are also looking closely at that for audits so you'll want to make sure you set it up to the tax law.

post #6 of 11
Thread Starter 
I have the kids most of the time. He takes them one or two weekends a month. This is his weekend, but he says he can't take them, even though he made the calendar. One of the proposals he sent asked for them every other week all summer. But ds has ADHD and we take him off meds in the summer so daycare he has never been to other than mine. We have no daycare costs. Except once in a blue moon. Like Marin Luther king day, need to find a sitter.
post #7 of 11

Personally speaking, I'm a numbers person so I would want to run the number each way and decide if it's worth it. I'm not sure what this proposal is in lieu of. If he takes it, there's noting that says you can ask for something you want in return.

 

There are 3 things to negotiate over - the child credits, the exemptions/dependents, and the filing status.

 

Usually, the head of household status is a bigger tax savings for most people so as long as you can claim this (and having them more than 50% it sounds like you can) that is what I would focus on agreeing to. Not sure your income level but it might not actually be that much of a dent claiming the credit. The dependent status is the second biggest dent in the bill after the filing status unless you have no income.

 

IRS probably won't care as long as you don't both claim the same kid in a single year but I would double check with someone who keeps up with tax law. I really don't see the advantage of claiming different kids each year unless there is an age difference (i.e., one is about to turn 18). It's a set dollar amount per kid so it doesn't matter so much who is claimed where. The only really big issue I can see (based on the limited information I have about you) is if you apply for a program where the number of dependents matter (like EIC) or other state benefits where one has to be claimed with you.

 

For when he denies the kids I would document that. Not too helpful for tax purposes (other than helping establish overnights for the head of household filing) but it could come into play for cs calculations.

post #8 of 11

we have 2 kids & our agreement is that we each get one and alternate them each each year (so that when oldest ages out, we'll continue alternating youngest until he's too old). Last year was the first time we'd be doing this (we filed jointly for a few years while separated but still legally married) and XH hadn't planned for any of it so he asked to claim them both. Because my only taxable income is Spousal Support and my home biz income, I allowed him to do it, provided he pay for the taxes that I wouldn't have to pay if I got to claim one of them as agreed. My tax was only $131 without claiming a kid compared to over a thousand he'd have to pay if he could only claim one, so the deal was worth it. It is frustrating to me to allow it, though since the Child & Spousal support was calculated based on each claiming one kid and I'd be getting more than $131 a year if we'd calculated it with him having all the deductions and me having none.

 

He hasn't asked if I'll do the same thing this year, but I would be ok doing it again, since it doesn't cost me anything.

post #9 of 11

You file as married for 2012 if divorce isn't final yet.  I had the same situation last year, ours wasn't final until Jan. and so I did married filing jointly- ex was verbally abusive about splitting the refund but since it was more than he would get singly he had to just deal.

 

For us, I have the kids more than 50% and get to take all the credits.
 

post #10 of 11
Quote:
Originally Posted by provocativa View Post

You file as married for 2012 if divorce isn't final yet.  I had the same situation last year, ours wasn't final until Jan. and so I did married filing jointly- ex was verbally abusive about splitting the refund but since it was more than he would get singly he had to just deal.

 

For us, I have the kids more than 50% and get to take all the credits.
 

If you have a legal separation you don't have to file as married.

post #11 of 11
Quote:
Originally Posted by ZoeyZoo View Post

 

 

There are 3 things to negotiate over - the child credits, the exemptions/dependents, and the filing status.

 

 

Actually, there is only one thing to negotiate when it comes to taxes.  HOH goes to whoever has the kids the majority of overnights.  The IRS is the one who determines what the qualifications for this are.  Now, if there are two kids and one parent is claiming each kid, chances are the IRS isn't going to pay too close attention to this unless there are some other circumstances involved, more on this later.

 

The child credits (not the childcare credits, that goes to the custodial parent) follows who gets the exemption.  That's per the IRS.  So that leaves the only thing to negotiate being the exemptions.  And per the IRS, that goes to the custodial parent.  Unless the custodial parent signs a form 8332.  If the number of overnights is equal, then it is the parent with the higher AGI. 

 

Now for the more on this later above.  Only the parent who has the child for the most overnights can get the EITC, if they qualify.  A state court order cannot get around this.  And if a parent is claiming HOH for one child, with the custodial parent claiming EITC, then that is going to create issues for both parents.  With the NCP having to refile their taxes as they did not qualify for the HOH filing status.  Which can only be determined by the IRS, not a state court. 

 

I am a numbers person.  It's what I do for a living.  I am very sure of what I have state above.  And all of this information can be found at the IRS website or from a CPA who does taxes. 

 

One thing that I would like to mention for when one is negotiating the tax exemption for the kid(s) is it's probably a very good idea to have wording in there that the NCP is up to date on all financial obligatoins, including his/her share of extracurricular activities (if it is in the court order that the NCP pays, that is), medical expenses and child support (this includes child care costs) in order to be able to claim the child. 

 

Now, for your filing status for 2012.  How long have you been separated?  If it was less than 6 months in 2012 (or you are still living in the same house while the divorce is going on), your only filing options are either married filing jointly or married filing separately.  Work out the tax as married filing jointly.  Then have him pay you your half before it is filed and he gets to have it all deposited into his account when it is processed.  If it was more than 6 months and you had the kids the majority of the time then you would file HOH and claim the kids.  But again, if you derive no tax benefit from this, I would let your stbx claim the kids. \If it has been less than 6 months but there is a legal separation agreement, you will want to contact the IRS to confirm that you can file HOH. 

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