Divorced Parents and Child Tax Credits

If a divorced couple has children, only one parent is eligible to claim any credits relating to the child. This means that one parent cannot claim the Earned Income Tax Credit, while the other claims dependency exemptions and credits. Typically, the custodial parent is eligible to claim the dependency exemption, the child tax credit, the EITC, dependent care credit, as well as being able to file using head of household status.

There is an exception which applies to divorced or separated couples who have lived in separate residences for the last 6 consecutive months of the tax year. In these cases, if the parent with whom the child resides relinquishes their right to claim the exemption, the noncustodial parent may claim the dependency exemptions, as well as the child tax credit if eligible.

The dependent care credit may only be claimed by the custodial parent. Additionally, due to the requirement that states a child must live with the taxpayer for over six months of the year (temporary absences aside), typically the custodial parent is the only one eligible to claim the Earned Income Tax Credit.

For tax purposes, custody is determined by the amount of nights a child spent in the parent’s home, or the number of nights a parent was responsible for the care of the child.