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Financial Issues This forum is for discussing any of the financial issues involved in your divorce.

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Old 06-15-2016, 10:54 AM
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Default claiming eligible dependant on shared custody

are there any tax accountants on this forum?

I was in a conversation with another dad and I promised to ask this question on this forum. He has an separation agreement with his ex. Because they have his children 50/50, on it they agreed that each parent will claim one child each and alternate. However, he just got remarried and his accountant says that his new wife has to claim his kids because she is the lower income in the house hold. first of all is this correct?

His Agreement says "Father shall claim on his tax return child 1 as an eligible dependent in even number years and mother shall claim child 2 as an eligible dependant on odd number years...".

Can he let his new wife claim this as she is part of the household. His ex argues that it is not what the wording in the agreement says, so she will go ahead and claim both children next year since he can't.

any comments on who is right or wrong?

thanks
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Old 06-15-2016, 11:48 AM
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^

I have seen situations where a step parent was used to claim the eligible dependent child tax, due to the fact that the bio parent married to the step parent earned more money, so they decided to use the step parent to claim.

In your particular case, if the ex goes ahead and claim the 2nd child on top of what she is already claiming, all "your friend" has to do is also go ahead and claim the 2nd child. CRA will reassess both of them once they find out, and the ex will have to pay back that money, or have it deducted from her future entitlements.

It's that simple
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Old 06-15-2016, 12:18 PM
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I told him that he probably could, but the wording on his separation agreement doesn't allow it. It says "father claims" the new wife is not considered in the wording. So this might screw him.
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Old 06-15-2016, 01:21 PM
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Default claiming eligible dependant on shared custody

Quote:
Originally Posted by JRSDad View Post
I told him that he probably could, but the wording on his separation agreement doesn't allow it. It says "father claims" the new wife is not considered in the wording. So this might screw him.


BUT, they are filing their taxes together so technically he is claiming it on his taxes they are just combined to maximize tax benefits. If they filed separately then he would claim it himself.

Why did he even tell his ex they were filing that way? The less she knows the better. Bottom line is hes claiming the credit, how he claims it really isnt her business.
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Old 06-15-2016, 02:00 PM
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I agree with Rockscan. He is claiming it, just claiming it in the way CRA demands due to his remarriage.
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Old 06-15-2016, 02:18 PM
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You know, I asked him the same question "what she don't know won't kill her". but he said they exchange full tax returns, so she would see that it was missing from his return for next year, he gave her a heads up he said. lol...I still wouldn't have said anything. but thanks for the other view on it, it makes sense!
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Old 06-15-2016, 03:01 PM
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Default claiming eligible dependant on shared custody

Then what he does is tell her that hes claiming it on his household taxes and if she tries to claim it in his year he will report her to CRA for a full audit. That might shut her up.

ETA he can also add that nothing in their agreement says either one can claim the credit for the others year so shes really using an invalid argument. If he chooses not to claim it in his year, their agreement doesnt say that means she gets to claim it.

Last edited by rockscan; 06-15-2016 at 03:04 PM.
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Old 06-21-2016, 03:23 PM
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If he's now married, he can't legally claim the "amount for eligible dependant".
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Old 06-22-2016, 02:01 PM
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But his new wife can is my understanding.
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Old 06-22-2016, 09:58 PM
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Quote:
Originally Posted by JRSDad View Post
But his new wife can is my understanding.
We really need a tax person to join this board. There are so many unanswered questions about taxes and children after divorce.
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