Form 8332 Needed?

I had a client ask me a great question yesterday afternoon: “If the divorce decree says I get the exemption for my child, do I still have to get my Ex to sign that form you told me about?” My client was describing Tax Form 8332, which is the form for release of an exemption from one parent to the other.

The short answer is no. One of the advantages of the Working Families Tax Relief Act of 2004 is that it eliminated the requirement of a Form 8332 for divorced parents whose divorce decree specifies who gets the exemption. Internal Revenue Code Sec. 152(e), entitled “Special Rule for Divorced Parents” says a parent can claim the exemption for a child if the divorce decree provides that the noncustodial parent “shall be entitled to any deduction allowable under section 151 [IRC §151] for such child.” There’s no longer a requirement that the parents follow up with a signed Form 8332.

17 comments to Form 8332 Needed?

  • Mark

    On my divorce decree under “Exemptions For Dependents” it states as follows:

    “For 1990 and so long as the Husband is obligated to pay alimony to his wife, the Husband shall have the right to claim the two children as personal exemptions on his federal and state income tax returns. When the Husband is no longer obligated to pay alimony to the Wife, the Wife shall have the right to claim [son] and the Husband shall have the right to claim [daughter], as their exemptions.”

    IRS ruling states in part, as the custodial parent [wife], I can only deduct tuition expenses (line 43 on Federal Form 1040) I incurred for my daughter if I am claiming her as an exemption on my return. In speaking to an IRS advisor, after her review of IRS rules related to this situation and of the divorce decree clause above, she stated I can claim my daughter because the divorce decree did not specifically state;

    1. That I WILL NOT claim [daughter] as a dependant for the year, and also because;

    2. The decree did not state “the years for which the noncustodial parent, rather than the custodial parent, can claim the child as a dependant”.

    Do you agree with this assessment? If so, does this mean that the above clause in my divorce decree conflicts with Federal (IRS) Law?

  • I think you’re entitled to trust your lawyer’s advice. It’s not the advice I would give based on the little bit I know, but your lawyer knows much more about this than I.

  • Chris G

    My ex-wife released her claim of dependents to me on a 8332 form for our children. I now claim the children as my dependents. My ex-wife’s aunt died and left the children some bonds. My children still live with her and are minors.I do not know if these bonds have been cashed yet. My ex-wife is asking for my 2007 income tax return and is stating that I am responsible for the taxes on these bonds. If the bonds have been cashed, I can assure you that the children did not see a cent of it. Will I be accountable for these taxes even if they have been cashed and spent by my ex-wife?

  • I don’t yet understand the theory for your being liable for the taxes. Is she saying you’re liable because you claim the exemption for the children? If so, I don’t agree. Let’s take this to its absurd conclusion. Let’s say that the bonds were not small in value but were in fact worth $100 million, that Mom cashed them, and that she then gambled away the proceeds. Would she still say you are liable for the taxes on $100 million? Why?

    Somebody (apparently not you) received the benefit from these bond proceeds. That’s the person who should pay the taxes on that benefit.

  • lori

    I was told by a few different tax offices here in PA, that even tho i signed a decree when i was divorced (April 23 of 2006) that my husband and i would alternate years to claim my daughter, that i could claim her this year. I did so and recieved my return and then my ex husband filed papers to take me to court over this matter. I asked and even had an office print up papers to prove that i could (they charged me for the papers). He doesnt even see his child half of the time he is supposed to. He see’s her mearly as a tax right off and that is basically it. Is there any way that i can fight this matter in court seeing as I am going to be going to court over this matter in june?

  • Let me make sure I’m understanding your question. I think you’re saying that (a) your divorce decree says that Dad is entitled to claim the exemption every other year; (b) you claimed the exemption two years ago, so last year was “Dad’s year;” (c) Dad continues to see the child regularly and is otherwise in compliance with the divorce decree; and (d) despite that, “a few different tax offices” told you you could defy the court decree and claim the exemption that was supposed to be Dad’s.

    If my understanding is correct, it’s time to go back to those “few different tax offices” and ask them what they were smoking. Dad wins. You lose. I’m sorry.

  • Shelley

    My divorce decree says that we have to take turns as long as he is paying me child support. Well, of course, he is not paying me support. He has paid me $600 this year and owes me $5000. So, my question is, do I have to tell him that I am claiming her this year or can I just do it?

  • This answer assumes you have not already given Dad a Form 8332 applicable to future years.

    Read your divorce decree carefully. If it says Dad’s right to claim the exemption is conditioned on his being current with all his obligations at some particular time, and if that condition was not met, then Dad doesn’t have the right to claim the exemption.

    If it says something else, you need a lawyer’s advise before acting.

  • Christine Wallace

    My husbands ex-wife signed an 8332 giving him his son as an exemption until he is 18. We were late in filing our 2002 taxes and our accountant forgot to put his son as an exemption on the return. We are being audited and are trying to add him to our return as he was ours to take. The IRS said that the ex-wife took the son as an exemption in 2002 even though she wasn’t entitled to but because we didn’t have him on our original return we are out of luck. This doesn’t seem right to me. My husband never agreed to give up the exemption for 2002? Is the IRS correct?

  • Hmmm. I first said the IRS was doing what it was supposed to be doing, but now I’m not so sure. If Dad has a Form 8332 giving him the right to the exemption, it seems to me that he’s entitled. This one is a weird one, and I honestly don’t have an answer for you. I think I would be inclined to start with the IRS Taxpayer Advocate Service at http://www.irs.gov/advocate/article/0,,id=97402,00.html.

  • The IRS has tie-breaker rules when two individual try to claim the same dependent. Given the fact that you have the 8332 form, you should be entitled to the exemption. Does the son live with you more than 50% of the time? Do you provide more than 50% of the support for the son? Who makes more money? I would discuss these questions with your attorney or a qualified tax advisor specialising in divorce issues.

  • Melanie Williams

    My boyfriend has a divorce decree 2006 that says that he can claim his son while the mother claim the daughter.It also has marked that the parents shall sign the federal income tax dependency waiver. This form was not signed and the mother has claimed both in 2006 2007 2008 2009. The dad lives in NC and the mother lives in WA State. What can be done if anything?

  • I’m not sure anything can be done for prior years, because it appears that neither party did what the judge ordered the parties to do. For years going forward, Dad needs to tender Mom a signed Form 8332 and another ready for her to sign. If she refuses, she has breached the judge’s decree, and he can opt to enforce the decree as described here: http://www.divorceinfo.com/enforcement.htm

  • He did try to claim the son on his taxes and now he is due 10k for her claiming him and his being returned. He sent them a copy of the order and a form that has her info and his along with the children. He has not heard anything yet. Do you think that if he get the prior years forms and request her to sign it would be sufficiant? If she refuses then he may can send her a letter certified requesting info again. If fail then can he go to a judge?

    Another question: It has been a battle with these 2 for 8 years about child support. He was ordered to pay 1437.00 a month for the two kids who are 14 and 16 now. I went through the paper work and seen where he was ordered to pay 526.00 for childcare which the kids never received. He filed a motion for modification and requested that he get reimbursed from 2006 to 2009. She admitted no childcare ever recieved and they dropped the support to 783.00 and she had to take a decrease of 223.00 to be applied to some of the overage and it dropped again to 560.00 fom oct 2009 to Nov. of this year. The mother filed a motion in April to get an increase due to it had been 2 years since she last did a modification and due to the children ages. He was served again. She is currently paying him back for some of the childcare and we had to fill out another request for modification for the 2010 childcare payments in which came to 9900.00 overage. He did send in all info requested. He just received the proposed order by DSHS for 957.00 a month and no mention of the the overage for childcare that she was paying on and still owes. They are also requesting temporary order from june 1 2010 until court date on oct 13. What does he need to do NOW? Order originated in King county superior court, Modified in Wenatchee county District court, DSHS told him that they had to send back to King county, But proposed order is from Snohomish county Superior court. DSHS also told him that recent modification done on his behalf cant over-ride orginal order from King county. He now thinks the system does not work for men and this is when so many men give up.. PLEASE HELP!!!!

  • Your questions are very specific and require a knowledge of the facts that I don’t have as well as knowledge of your state’s law. I’m sorry.

  • C Hurst

    My daughter is 19 and has been in college since age 17 (she turned 18 while at college). Last year was my ex wife’s year to take the exemption, so Form 8332 wasn’t an issue. However, now that it is my year and my daughter has been living at college, do I still need my ex wife to sign the 8332? College costs (room & board, tuition, books, etc) are all being paid out of a portfolio that was created during the marriage and the divorce decree specifies that I manage the money and pay the expenses from it. Obviously she is still a dependant but what is unclear is whether I need Form 8332. The Special Rule for Children of Divorced or Separated Parents says all of the following conditions must apply and #2 states, “the child was in the custody of one or both or the parents for more than half the year.” If she is over 18 and living at school, she is no longer in either of our custody. Any advice you can give is appreciated.

  • If the child is no longer a minor, she’s no longer a child and Form 8332 no longer matters. The question becomes one of who is providing more than 1/2 the (now adult) child’s support during the year. If neither of you is providing more than 1/2 her support, neither of you is able to claim the exemption.

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