Tax Time and Child Support Issues

When involved with a child custody case, it is a pretty common occurrence to also deal with who will be allowed to claim the child dependency exemption. Although the IRS will not allow the dependency exemption to be split in any one year, there is ample authority for a court to allocate the right the claim the dependency exemption. Usually, this takes the form of the parties alternating the years in which each is allowed to claim the child. Be aware, that the custodial parent may be required to execute IRS Form 8332 in order for the non-custodial parent to be allowed to claim the child.

A problem arises when the non-custodial parent is also paying child support and is behind on that support at the end of the year. For those of you lucky enough to live in the sunshine state, I understand that Florida has a specific statute that states a child support obligor may not claim the child tax dependency exemption if he/she is in arrears on that support obligation. While Kentucky has no such statute, there is support in the case law to allow you to have your attorney go back to court and request that the delinquent obligor be barred from claiming the children until the arrearage is caught up. Further, since the tax dependency exemption is something that is usually raised during settlement negotiations, your attorney should condition your assent of that division on the non-custodial parent's child support obligation being current at the end of the calendar year.

For more information on the tax implications of divorce, you should check out the IRS' Publication 504.