As any taxpaying veteran can tell you, dependents come in handy during tax season! They count as a hefty standard deduction against your taxable income in the first place, and can also qualify you for a bigger deduction for Child Tax Credit, Earned Income Credit, and other related benefits.
Seeing as how claiming dependents on your taxes can save so heavily on your tax bill, falsely claiming dependents is a very common mistake to make. It is also a very common form of deliberate fraud, but we’ll assume good faith in this article. Frequently, separated parents or other caregivers of a child each figure that they are qualified to claim a dependent child on a tax return. But the IRS allows a dependent to be claimed on one, and only one, tax return per year.
Much of this process applies to any scenario where you claimed a dependent (child or adult) that was already claimed on another tax return. But for our purposes, we’ll focus on the most common scenario: Separated parents who each claim a mutual child.
First, Double-Check Your Status As A Claimant
Just to be sure, you want to verify, if possible, the status of the child in question regarding tax returns. There can be many tricky edge cases involving shared custody, visitations, and other matters of family law which can make this hard to determine.
Use this handy worksheet, “Whom May I Claim as a Dependent?,” provided by the IRS to determine a qualifying claim on a dependent.
Steps to Claiming a Dependent Child That Someone Else Already Claimed
Prepare yourself by reading through IRS form 886-H-DEP, the “Supporting Documents for Dependents” sheet. It will list the conditions under which you may claim dependents, and documents you need to photocopy and send in to support your claim. These documents may include things like birth certificates, daycare records, custody orders, school records, medical records and other legal documents. Literally anything showing both your address and that you yourself and the child in question lived there may be helpful.
1. First, fill out a normal paper tax return, claiming your dependent child.
2. Mail that to the IRS.
3. Wait for reply back from the IRS. This will be something like “A dependent on your return has already been claimed (or claimed themselves) on another return.” Usually this will be a CP87A letter.
4. Respond to the IRS’ request for additional information, supplying the additional forms of proof as required.
Be sure to use USPS Certified Mail with a Return Receipt for this entire process, including filing the tax return!
Doing so ensures that you have proof to provide later, should you encounter a snag such as identity theft of the dependent, disputed claim of custody, lost records, an audit later on, and so on. The IRS moves a bit slower when handling paper (typically 6 to 8 weeks), but it’s worth it to have the documentation on hand.
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