Under federal tax laws, Texas parents are entitled to claim their children as dependents on their tax returns. Married couples who file joint returns typically claim the exemption collectively for their children. However, unmarried or divorced couples cannot file joint tax returns and may be unsure of who may claim the exemption. Even in a case in which one parent has sole child custody, under certain circumstances, the other parent may be able to claim a child as a dependent for tax purposes.
In some cases, a court may order a particular parent to be eligible for dependent child exemptions, or there may be a legal agreement in place. It is not uncommon for this issue to create contention between former spouses, and in the absence of a legal agreement or court order, parents may find it difficult to reach mutual agreement on who will claim. Reaching an agreement is important though, because problems can arise if both parents claim their children as dependents on their tax returns.
A five-step test based on IRS guidelines can help parents determine whether they are eligible for the exemptions. In completing the test, a parent will have to answer questions related to the amount of time the child spent as part of the parent's household in that tax year and whether the taxpayer and child are related by adoption or divorce. Citizenship and residency in the United States, Mexico or Canada will be questioned. With older children, their ages and income will come into play; if they can file joint returns with another taxpayer, the parent will not be able to list those children as dependents. Children who are still students and younger than 24 at the end of the tax year may be regarded as dependents.
Finally, the parent's child support contribution during that year must exceed 50 percent of the child's financial needs. For guidance and support in completing the IRS test, Texas parents facing child custody issues may benefit from utilizing the services of an experienced family law attorney. Knowing their individual legal rights may enable parents to reach agreements that will benefit both.
Source: FindLaw, "Who Can Claim The Children As Dependents For Tax Purposes?", Accessed on Sept. 18, 2015