Question:
In my divorce decree there is a provision that whichever parent has the greatest benefit to claiming the children on the taxes should claim them. That parent should then pay the other parent the amount that they would have received had they claimed the children.
In my situation, my ex-wife would have received a larger refund if she claimed them, but she already filed her taxes assuming that I would be claiming them. So when I filed them I got the refund though it is smaller than what she would have gotten if she claimed them.
Now she says she is entitled to that refund. Does she have a case?
Answer:
The tax dependent exemption provision of a divorce judgment is generally considered a property division based upon the equities of the child care responsibilities. In your case, the language in your divorce is too vague and leads to the situation you are in.
Your ex’s assumption is that the “refund” is the “greatest benefit,” which is not accurate. The refund could be due to over-withholding, a large deduction unrelated to the child, or other factors. So the amount of the refund is not the issue in your case.
It is the reduction in the total tax liability resulting from being able to claim the children as exemptions (Line 6c of the 1040 Form) that would determine who received the greatest benefit by claiming the children.
While I am not a tax advisor, in general you would first compare the total taxes (Line 44 of the 1040 Form) for each party both with and without claiming the child to see how much of a tax savings each person received by claiming the child.
Then, any additional tax credits that may be generated by having the personal exemption for the child may come into play. This can be complicated based upon incomes and other factors, as some children related tax credits can be claimed regardless of being able to claim the child as a personal exemption on line 6c.
You would need to consult a tax advisor and a qualified domestic relations firm such as Cordell & Cordell, to evaluate whether the tax returns filed comply with the divorce or if amended returns need to be filed changing who claims the children.
Cordell & Cordell has men’s divorce lawyers across the country, including Illinois.
Erin Brockhoff is an Associate Attorney in the Belleville, IL office of Cordell & Cordell where she practices domestic relations exclusively. Ms. Brockhoff is licensed in the state of Illinois, and the Southern and Northern Districts of Illinois. Ms. Brockhoff received her Bachelor of Arts degree in Political Science and Psychology, magna cum laude, from Miami University. She received her Juris Doctor from the Chicago-Kent College of Law, where she was a member of the Moot Court Honor Society.
