Form 8323: Releasing a Child’s Tax Exemption

IRS Form 8332, “Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent,” is a declaration used following a divorce or separation. It allows the parent with whom a child lives for the majority of the year to transfer the right to claim that child as a dependent to the other parent. This written statement is the method the IRS requires, as informal agreements or court orders alone are not sufficient for tax filing.

While the Tax Cuts and Jobs Act of 2017 suspended personal exemptions for tax years 2018 through 2025, this form remains relevant. Its use is tied to eligibility for other valuable tax benefits, including the Child Tax Credit and the Credit for Other Dependents. The form ensures that only one parent claims the tax benefits for a child in a given year, preventing potential disputes.

Defining Custodial and Noncustodial Parents for Tax Purposes

For federal tax purposes, the definition of a “custodial parent” is based on a physical presence test, which may differ from custody arrangements in a divorce decree or separation agreement. The custodial parent is the one with whom the child lived for the greater number of nights during the tax year. This “number of nights” rule is the determinant the IRS uses to establish which parent has the initial right to claim the child.

If a child spent an equal number of nights with each parent, the IRS applies a tie-breaker rule. The parent with the higher adjusted gross income (AGI) for the tax year is then treated as the custodial parent. This financial measure is used to resolve the ambiguity.

Only the parent who meets the IRS definition of custodial has the authority to release the claim. The noncustodial parent is the parent the child did not live with for the majority of the year. They cannot claim child-related tax benefits without a signed Form 8332 from the custodial parent, which shows that legal custody and tax-defined custody are separate concepts.

Information Required to Complete Form 8332

To complete Form 8332, you will need the full name and Social Security Number (SSN) for the custodial parent releasing the claim. The full name and SSN of the noncustodial parent who will be claiming the child are also required, along with the full name of each child for whom the claim is being released. The form is available for download from the IRS website and is divided into three parts, each serving a different function based on the parents’ agreement.

Part I of the form is for a “Release of Claim to Exemption for Current Year.” This section is completed when the custodial parent agrees to release the claim for only the current tax year. You must enter the name of the child and the specific tax year for which the release is granted.

Part II, “Release of Claim to Exemption for Future Years,” is for longer-term agreements. The custodial parent can release the claim for a specific number of future years or for all future years. The form requires you to specify the exact tax years covered by the release. This can simplify the process by avoiding the need to execute a new form each year.

Part III is “Revocation of Release of Claim to Exemption for Future Year(s).” This section is used by the custodial parent to cancel a previously signed release for future years. To complete it, you must enter the child’s name and the specific tax years for which the revocation will take effect. A revocation does not take effect until the tax year after the year the noncustodial parent is provided with a copy of the form.

Executing and Submitting the Form

Once the appropriate sections of Form 8332 are filled out, the custodial parent must sign and date the form in the designated space. This signature legally executes the release or revocation. It is highly recommended that the custodial parent provide the original, signed form to the noncustodial parent and retain a copy of the signed form for their own tax records.

The responsibility for submission to the IRS falls to the noncustodial parent. To claim the child, the noncustodial parent must attach the completed and signed Form 8332 to their Form 1040 tax return. If filing electronically, the form is submitted with Form 8453, U.S. Individual Income Tax Transmittal for an IRS e-file Return. A copy of the form must be attached to the tax return for each tax year in which they are claiming the child based on the release.

Failure to attach the form to the tax return will have direct consequences. If the noncustodial parent claims the child without including the signed Form 8332, the IRS will disallow the related tax benefits, such as the Child Tax Credit. The form is the required evidence of the custodial parent’s consent, and without it, the claim is considered invalid by the IRS during processing or a subsequent audit.