Remification of claiming the same dependent on multiple retu

My client is in the process of divorcing from her husband. The husband is not my client. Their date of separation is December 1, 2022, when my client moved out of their home. They are not yet divorced. They had 2 dependent foster children together. They had joint custody of both children for the entire year. Both are under age 17.

My client has an AGI of ~62,000. Her husband has an AGI of ~54,000

The husband has already filed a tax return where he claimed both children as dependents on a MFS return. I am assuming that he has split the deductions, but he took a standard deduction and did not file schedule A. They own a home together and pay substantial interest and tax. He got refunds from both the IRS and the state of California.

My client is now presumably forced to file with no dependents and this is wrecking havoc on her tax return. The biggest issue is she has a health insurance credit of $8,373 that she would have to pay back entirely if she is forced to calculate her her PTC on form 8962 if she is forced to use a family size of 1. She would have reported a family size of 4 when she signed up for the insurance plan.

She is also forced to take a standard deduction even though the big obamacare payback would give her a medical expense deduction.

The bottom line is she would be forced to pay $6500 in additional taxes because her former husband did not share the two children as dependents. I am recommending that she send a mailed copy of her returns where she files as MFS with one dependent. I want to advise her of the exact ramifications of doing so. Thank you.

Review the tie breaker rules. If your client can claim both kids then do so and mail the return. The IRS will then determine who should prevail.

On the 8962 the members of your household do not have to be claimed as dependents on your return.

She is not forced to take the standard deduction. On the federal return, if one spouse chooses to itemize then the other spouse must itemize (or take a standard deduction of zero). It does not matter which spouse files first.

She is also forced to take a standard deduction

No she's not. Agree w/ Mark. If it's advantageous for her to itemize, then itemize. The ex will have to deal with the fallout.

Did the kids leave when mom did?

As others have said, don't worry about him claiming kids. Need to figure out who is entitled to take kids. If she is entitled then paper file.

I agree with what everybody is saying here, she should claim a dependent. What I am looking for is a description of the process IRS will make her go through in order to prove the claim. As must as she is getting messed over here, she doesn't want to deal with the former spouse at all, so is considering just filing single and paying the tax to be free of the stress of the situation.

Is there any child support? I had a case like this a few years ago and the child support bolstered our argument that my client had physical custody.

She won't have to deal with the ex. When she itemizes, the irs will deal with the ex. When she claims the kids, the irs may contact her and she can provide proof to the irs. That won't involve dealing with the ex. I'm assuming single is a typo, but if not, she's not eligible to file single.

I agree with what everybody is saying here, she should claim a dependent. What I am looking for is a description of the process IRS will make her go through in order to prove the claim. As must as she is getting messed over here, she doesn't want to deal with the former spouse at all, so is considering just filing single and paying the tax to be free of the stress of the situation.

As I states in my post, the IRS will make the determination.