Death and taxes

The party who the child(ren) are with the majority of the time is supposed to be the one who gets to claim them. If you have them an = number of overnights and both try and claim them IRS will look at who has the higher gross income and that person will get to claim. This is all in Unless there was something else drawn up in custody agreements, though with the death that would be probably be out the window anyway.
I would suggest that you have records to support this and just tell the SF that you intend to file and that you have gov’t regs on your side and if he gets audited so be it.

Hey, I know the answer to this one seeing as how my husband’s ex has tried the old IRS stunt a time or 2 (more on that later). Go to the following website, then click on “index” under “US Code Collection” at the top, then go to Title 26 (Internal Revenue Code), Subtitle A, Chapter 1, Subchapter B, Part V (and the various subsections). Basically, whoever has the kids for the majority of the year rules. Now, for those circumstances where there might be a close call (I looked at your previous post and noted that she passed on July 20 and I assume you got custody around that date), I’m guessing that you paid child support prior to that time and that the SF is NOT currently paying you child support. You essentially get some “credit” for the period that you were paying the ex support. The other option is to claim the additional visitation nights prior to July 20 to take you beyond the additional days needed to have them at least 183 days. Further, the SF has no legal standing with the IRS (just as he didn’t with the courts in terms of getting custody), only her estate does. To the extent there may be an inheritance or life insurance proceeds or social security that passes to the children as the result of her death, that is not considered “child support”.

Next, do NOT lose sleep over what happens if you both claim the exemption on your tax return. If that happens, you will get a letter from the IRS (as will the SF) stating that both parties took the exemption and that somebody needs to amend their return - no threats of audits, no threats of bamboo under your fingernails…the tone is that somebody must have made a mistake. If you are entitled to the exemption, you don’t need to do ANYTHING - the SF will have to amend his return. If you get a second letter because he DOESN’T amend his return, then you call the IRS (better yet, use a tax accountant to do your return and have them call the IRS), supply them with your documentation and they will go after the SF to amend his return.

WORD OF CAUTION: I don’t know all the specifics of your situation so you should go over what I’m posting with your tax accountant to be sure that you are entitled to the exemption. I’m not a CPA (but I did stay at a Holiday Inn Express last night…but I digress).

Now, on to how I know all about this…my husband and his ex separated in September 1998. I met him in the Spring of 1999 and he asked me to do his tax return for 1998 in April. I asked him if there was a separation agreement in place yet that might give her the exemption for 1998 and there was only a draft that gave her the exemption for 1999. Soooo, I told him to tell her that he was legally entitled to the exemptions for the kids and would be taking them. She announced that he couldn’t do that since she had already filed her return. I had to explain to him that “dibs” has never been, nor will it ever be, part of the Internal Revenue Code. (No, I’m not a CPA, but I am an MBA who works in accounting and works closely with tax accountants). So, my husband sweated and fretted about it until THE LETTER FROM THE IRS arrived (just as I described above), at which time he was sure he would have to go to prison and he almost had a stroke when I told him to DO NOTHING. Presumably, she amended her return, because we never heard about it from the IRS again. Fast forward…we were paying child support every month and then the children came to live with us at the beginning of June 2003. The only way the ex would agree to this “trial custody” (which has now lasted 4-1/2 years) was if she didn’t have to pay child support. Well, the situation with her was becoming very disturbing in regards to the childrens’ welfare, so my husband and I agreed to the no support. So, we had paid 1/2 their support for 5 months and full support (and they were in our custody) for 7 months - should be obvious, no? Well, at the end of December 2003, if you recall, the government sent a check for $400/child for 2003 taxes to the person who claimed the child on their 2002 tax return. Since my husband has 2 kids, the ex got the $800 check. We called and asked her to send it to us - she refused, claiming she was entitled to it…then she announced that she would be taking the children on her 2003 return since she had not thought to change her W-4 in June. (Of course, she tried to claim that my husband agreed to this in a telephone conversation, but he would no more make decisions regarding our tax return then I would tell him that I know more about football than he does). So, to make a long story longer, I sent her an e-mail telling her that we would let the IRS sort it out, but, that THIS time, if we got a letter, I would call the IRS and use the words TAX FRAUD - the first time she did it could be excused by ignorance, but the second time was an act of intent. Well, we took the exemptions and never heard a word from the IRS, so, she apparently didn’t file for the exemptions. Although I do understand from my tax accountant that she probably had to add the $800 back to her taxes for the check that she wasn’t entitled to…

Revenge is a dish best served cold.

Oh, and another thing (if you haven’t already dozed off reading my last post), the Internal Revenue Code doesn’t really care about custody agreements - they just care about where the kids lived. My husband’s original custody agreement gives his ex the exemptions from 1999 forward. However, there was a “substantial change in circumstances” in mid-2003 when the kids came to live with us. My husband and I still don’t have a final custody agreement because the ex has used every stunt in the book to put off a hearing on child support (we only agreed to no child support for one year - after that all bets were off and we filed over 2 years ago to obtain child support) as well as finalize the custody papers (my husband has a custody order, but due to a change of venue, the final terms have not been written), but I take those kids as exemptions on our tax return every year without fail and don’t think another thing about it.

Thanks for all the info!


This question should be answered by a tax attorney, we are not tax specialists and therefore are not qualified to offer tax advice.

You may be able to find some additional information regarding your questions here:

Helena M. Nevicosi
Attorney with Rosen Law Firm

4101 Lake Boone Trail, Suite 500
Raleigh, North Carolina 27607
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This really is not a laughing matter, so excuse the subject title if it appears I am being to light. From previous posts, you can see that my husband’s ex died in July. Since then we have had custody. It appears that tax time is going to be a little rough. My husband, of course as custodial parent now, fully intended on claiming the children on his taxes for 2007. The SF still fully intends on claiming them on HIS taxes. We don’t want this to get dirty and to this point have managed to deal with him on a pretty civil level. If it is based on who has had them the most # of overnights during the past year, along with who has provided the support for them, it would seem that my husband is in the right in claiming his own children. At this point, there has been no real discussion about it, because both men are sticking to their guns and both are determined to file with the children listed. I know that if two tax returns go to the IRS with the same children on them, we will be looking at trouble, perhaps and audit and obviously we don’t want to deal with that. So, I was hoping you could possibly help. What is the answer to this?