Tax season is stressful for anyone. But when you share custody of a child, it can bring up questions that feel more confusing than they should be. One of the most common is: who gets to claim the child on their taxes? If you and your co-parent have a 50/50 custody arrangement, the answer is not always simple. The good news is that there are clear rules from the IRS and California courts that explain exactly how this works.
Whether you are going through a divorce, finalizing a parenting plan, or just trying to file your taxes correctly this year, understanding these rules can save you a lot of trouble. Here is what you need to know.
Only One Parent Can Claim the Child on Taxes
No matter how you and your co-parent split time with your child, only one of you can claim the child as a dependent on your tax return each year. The IRS does not allow both parents to claim the same child in the same tax year. This rule applies even when both parents share expenses equally and each pays for the child’s needs throughout the year.
If both parents file a tax return claiming the same child, the IRS will flag the duplicate. Your return could be delayed or rejected entirely. In some cases, the IRS may require extra documentation or open an audit to figure out who filed correctly. It is a situation you want to avoid, and a little planning up front will prevent it.
What Is a Qualifying Child?
Before either parent can claim a child, that child has to meet the IRS definition of a “qualifying child.” To qualify, the child must meet tests based on age, relationship, residency, and whether the child files a joint tax return of their own. A qualifying child is one of the following:
- Any age, if they are permanently and totally disabled
- Under the age of 19
- A full-time student under the age of 24, enrolled for at least five months of the year
The child must also live with the parent claiming them for more than half of the year. The qualifying child includes biological children, stepchildren, adopted children, foster children, siblings, grandchildren, nieces, and nephews. One thing to keep in mind: a qualifying child generally cannot file a joint tax return, though there is an exception when they file only to get back taxes that were withheld.
The California Franchise Tax Board (FTB) mirrors the federal tax code on this issue. If your child qualifies under federal rules, they qualify under California rules too.
The Residency Rule: Who the Child Lives with the Most
The main factor the IRS uses to decide which parent can claim the child is the residency rule. Simply put, the parent the child spends the most nights with during the year is the custodial parent for tax purposes, and that parent has the right to claim the child.
A night is counted when the child sleeps at the parent’s home, even if that parent is not physically there that night. A night also counts when the child is traveling or staying with that parent outside of the home, like on a vacation or an overnight trip.
What if the child is at summer camp or spending the night at a friend’s house? The IRS looks at the regular custody schedule and asks which parent would have had the child that night under normal circumstances. That parent gets credit for the night.
Who Claims the Child with 50/50 Custody?
This is where things get interesting. If both parents have exactly the same number of overnights with the child in a given year, the residency rule does not give either parent a clear advantage. So how does the IRS decide?
When the parenting time is truly equal, the parent with the higher adjusted gross income (AGI) gets to claim the child by default. AGI is your total income for the year before most deductions are taken out.
Here is something most people do not realize: a truly equal split only happens in leap years. Regular years have 365 days, which is an odd number. That means one parent will always end up with at least one more overnight than the other under most standard custody schedules. Leap years have 366 days, making a perfect 50/50 split possible. Outside of a leap year, the only other time this issue comes up is during the divorce process itself, before a final custody order is in place.
Can a California Court Change Who Claims the Child?
Yes, but there are limits. California family courts generally follow the same rules as the IRS. The court will not usually order something different unless both parents agree to it in writing.
That said, courts do have some discretion. In certain situations, a judge may order the non-custodial parent to receive the dependency exemption. This can happen when parenting time is essentially equal, or when one parent is getting an increase in child support and the other parent receives the tax claim in exchange. When a court does this, it can also order the custodial parent to complete the paperwork needed to transfer the claim.
California case law has confirmed this authority in cases like Monterey County v. Carnejo (1991) and Rios v. Pulido (2002). These decisions show that courts have flexibility, but they are not going to override the IRS tax code without a good reason and proper documentation.
IRS Form 8332: The Waiver That Makes It Official
If a court orders the custodial parent to give up their right to claim the child, or if both parents agree to let the non-custodial parent have the claim, the IRS requires a specific form to make it official. That form is IRS Form 8332, also known as the Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent.
Without this form, the IRS will default back to the custodial parent regardless of what the divorce decree or parenting plan says. The form must be filed at least one year in advance for it to apply to the current tax year. If your divorce decree was issued before 2009, the original judgment may have been enough on its own. For divorces finalized in 2009 or later, Form 8332 is required.
The California Franchise Tax Board also recognizes and enforces the Form 8332 designation, consistent with how the IRS applies it at the federal level.
Tips for Co-Parents Handling Tax Claims
If you are sharing custody and want to avoid problems at tax time, a few practical steps can make a big difference.
Get Clear on Who the Custodial Parent Is
Even in a joint custody arrangement, courts and the IRS still need to know which parent is the primary custodial parent for tax and legal purposes. Physical custody, meaning where the child actually lives the majority of the time, is what drives this decision. The designation also matters for other benefits, including Head of Household filing status. Only the custodial parent can file as Head of Household, which comes with a more favorable tax rate and a higher standard deduction than filing as a single person.
Add a Tax Clause to Your Parenting Agreement
One of the best things you can do is address the tax claim directly in your parenting plan or divorce decree. Specify which parent has the right to claim the child each year and under what conditions. Some parents choose to alternate years, meaning one parent claims the child in odd years and the other in even years. Others base the claim on who provided more financial support. Whatever you decide, put it in writing and make sure it is part of a court order so it can be enforced if needed.
Connect Tax Rights to Child Support Payments
California family courts can tie the right to claim a child to child support compliance. If a parent falls behind on support payments, the court may take away their right to claim the child for that tax year, even if the original parenting plan gave them that right. This is another reason to keep accurate records of all payments and make sure your court order addresses what happens if support goes unpaid.
Update Your Agreement When Things Change
Custody arrangements, income levels, and support obligations change over time. If your current court order is silent about who claims the child on taxes, or if your situation has changed significantly since it was written, a custody modification may be worth considering. Getting clarity before tax season is far easier than dealing with a dispute after both parents have already filed.
Who Else Might Be Able to Claim the Child?
In most cases, only one of the two parents will claim the child. But in rare situations, a stepparent, grandparent, or other relative may be eligible. This only applies when the child lives primarily with that person, they provide the majority of financial support, and neither biological parent meets the IRS dependency criteria on their own. These situations are uncommon but worth knowing about if your family’s living arrangement is not a typical two-parent split.
What Happens If Both Parents Claim the Child?
If both parents accidentally or intentionally claim the same child, the IRS will catch it. When a duplicate claim is detected, the following can happen:
- One or both returns may be delayed while the IRS investigates
- A return may be rejected outright
- The IRS may request additional documentation from both parents
- In some cases, an audit may follow
If your co-parent claims the child in violation of a court order, that is a legal matter as well as a tax matter. A family law attorney can help you enforce the order and address the situation with the IRS properly.
Have Questions About Your Custody and Tax Rights?
Tax questions tied to child custody can get complicated quickly, especially when income levels shift, custody schedules change, or a co-parent is not following the court order. The rules from the IRS and California courts are clear, but applying them to your specific situation is not always straightforward.
Griffith Young is here to help. Whether you are setting up a parenting plan for the first time, updating an existing custody order, or dealing with a dispute over who should have claimed the child, our team can give you clear guidance and protect your rights. Call us today at 858-345-1720 to schedule a consultation.