When parents share 50/50 custody of their child, determining who gets to claim the child on their taxes can become a challenging issue. Understanding the laws surrounding child custody and tax claims in Texas can help to avoid disputes and ensure compliance with tax regulations.
How Tax Laws Apply to 50/50 Custody in Texas
In a 50/50 child custody arrangement, both parents share equal parenting time and responsibilities for their child. However, the Internal Revenue Service (IRS) does not allow parents to split tax benefits for the same child in a given tax year. Instead, only one parent can claim the child on their taxes. This raises the question: how do parents decide who gets to claim the child?
IRS Guidelines for Claiming a Child
The IRS has clear rules for determining which parent can claim a child, which is important for tax claims in Texas.
- Residency Requirement: The child must live with the parent for more than half the year. In 50/50 custody arrangements, this requirement is often evenly shared, making it less helpful in deciding who claims the child.
- Support Requirement: The parent claiming the child must cover more than half of the child’s financial needs. This can be a tricky issue in joint child custody cases where both parents contribute equally.
- Tie-Breaker Rules: If both parents meet the above requirements, the IRS uses tie-breaker rules to decide:
- The parent with the higher adjusted gross income (AGI) typically gets to claim the child.
- If both parents have similar AGIs, they can agree on an alternative arrangement or rely on a court order to determine who claims the child.
Who Claims the Child According to Texas Family Law?
While federal tax law governs dependency claims, child custody agreements under Texas family law can influence decisions. Parents often agree to address tax exemptions in child custody orders, specifying which parent claims the child each year.
For example:
- Parents may alternate years for claiming the child.
- One parent may receive the right to claim the child if they shoulder a greater portion of expenses, even with 50/50 child custody.
The child custody order is basically the roadmap for figuring out who gets to claim the child and when. It’ll spell out the details so you don’t run into any issues with taxes or the court later on.
What Happens if Both Parents Claim the Child?
If both parents claim the child, whether by mistake or intentionally, the IRS will flag the returns and apply its tie-breaker rules. This could result in both parents being audited, with the IRS assigning the claim to the parent who has the higher income or better proof of residency. Penalties for incorrect filings are also possible. To avoid these issues, parents should communicate clearly and follow the terms outlined in their child custody agreement.
Resolving Disputes Over Tax Claims in Texas
Tax disputes between parents are common in 50/50 child custody arrangements, especially when custody agreements don’t clearly outline who gets to claim the child. Without clear guidance, these conflicts can create tension and even lead to legal or financial consequences. Here are a few steps you can take to resolve the issue:
- Review the Custody Order: Carefully read your child custody agreement to see if it specifies who claims the child and under what circumstances.
- Negotiate a Resolution: Communication with your co-parent is essential. Work together to reach a fair agreement, such as alternating years for claiming the child or dividing financial benefits like deductions.
- Seek Legal Assistance: If negotiations stall, consult a family law attorney. They can help clarify your rights and, if needed, assist in obtaining a child custody agreement to address the tax claims in Texas more explicitly.
Taking the time to address these disputes proactively can save you a lot of frustration and prevent costly mistakes. If you’re unsure of your next steps, a family law attorney can provide the guidance you need to find a resolution.
The Role of a Family Law Attorney in Tax and Custody Matters
Understanding child custody and tax claims in Texas can be complex, but you don’t have to face it on your own. At Deyerle Silva Smith PLLC, our skilled family law attorneys are dedicated to helping parents craft legally enforceable child custody agreements, modify existing orders, and address disputes effectively. Whether you need guidance on drafting a new agreement or resolving tax-related child custody challenges, our team is here to help. Contact Deyerle Silva Smith, PLLC today.