Other Parent Claimed Child on Taxes. What Should I Do?

Filing taxes can get complicated when multiple people believe they have the right to claim a child as a dependent. This often arises in cases of divorced or separated parents, where both may attempt to claim the same child, leading to IRS complications and potential delays in tax refunds.

If someone else has claimed your child on their tax return, there are steps to resolve the situation. Understanding how custody affects dependency claims, how to dispute an incorrect claim, and what the IRS does to verify dependents can help address the issue efficiently.

The Custody Factor in Claiming a Child

The IRS has specific rules for determining who can claim a child, with custody playing a key role. Generally, the parent who has the child for more nights during the year is considered the custodial parent and has the right to claim them. If both parents have equal time, the parent with the higher adjusted gross income (AGI) has priority under IRS “tie-breaker” rules.

Legal custody agreements may specify who can claim the child, but IRS regulations take precedence. A court order may designate one parent as the custodial parent, but the IRS bases its decision on where the child physically resides most of the time. If a noncustodial parent wants to claim the child, the custodial parent must sign Form 8332 to release the exemption. Without this form, the IRS defaults to the parent with primary custody.

Some parents alternate claiming the child each year, but the IRS does not track these agreements. If both claim the child in the same year, the one without proper documentation may face an audit or have their claim denied. Keeping custody schedules, school enrollment, and medical records can help establish custodial status.

Resolving Disputed Claims

If someone else has claimed your child, determine whether it was an error or intentional. The other parent may have misunderstood the agreement or assumed they had the right to claim the child. A direct conversation can sometimes resolve the issue. If they agree to correct the mistake, they can file Form 1040-X to amend their return and remove the dependent.

If the other parent refuses to cooperate, file your tax return as usual, claiming the dependent. If the IRS detects a duplicate claim, it will reject an e-filed return, requiring a paper submission. This triggers a review where the IRS requests documentation from both parties to determine who qualifies. School records, medical bills, and official correspondence showing the child’s primary residence can support your claim.

If neither party concedes, the IRS may initiate an audit, which can take months. The parent who improperly claimed the child may face penalties. If the dispute escalates, consulting a tax professional or seeking legal action may be necessary.

The Role of IRS Verification

When two taxpayers claim the same dependent, the IRS begins a verification process that can take months. The IRS does not proactively check dependent claims but reviews them when duplicates arise, delaying refunds for both parties.

The IRS relies on documentation rather than verbal agreements or court orders that do not align with tax regulations. Taxpayers may need to provide school records, medical documents, or lease agreements to establish the child’s primary residence. The IRS also reviews prior-year filings to identify patterns. If one parent has consistently claimed the child and another suddenly does, it can trigger further investigation.

In some cases, the IRS issues a CP87A notice to both parties, warning of a duplicate claim. If neither amends their return, the IRS may begin a formal audit, which could include interviews or additional document requests. Failure to provide sufficient proof can result in denial of the dependent claim, requiring repayment of any improperly received tax benefits.

Filing Amendments

To correct a tax return due to a dependent claim issue, file an amendment using Form 1040-X. This form allows updates to filing status, claimed dependents, or incorrectly calculated tax credits.

Amending a return does not automatically trigger penalties, but if the correction results in additional tax liability, interest may accrue from the original filing deadline. The IRS generally allows amendments within three years from the original filing date or two years from when the tax was paid, whichever is later. Processing can take up to 16 weeks. If the correction increases tax owed, paying promptly minimizes interest charges.

Potential Consequences for False Claims

Incorrectly claiming a child, whether intentional or accidental, can lead to financial and legal consequences. The IRS monitors dependent claims and imposes penalties on those who knowingly submit false information. While some cases result in claim rejection, repeated or deliberate violations can trigger audits, fines, and restrictions on claiming tax credits in future years.

One immediate consequence is repayment of any improperly received tax benefits, such as the Child Tax Credit or Earned Income Tax Credit (EITC). The IRS may also impose a penalty of up to 20% of the underpaid tax due to negligence. If fraud is suspected, penalties can escalate to 75% of the underreported tax, and criminal charges may follow.

Taxpayers found to have improperly claimed a dependent may be barred from claiming certain tax credits for up to 10 years. This can be significant for those who rely on refundable credits. The IRS may also increase scrutiny on future returns, leading to more frequent audits. If a dispute escalates into legal action, court proceedings can add costs, including attorney fees and possible custody modifications affecting future tax filings.