Many dissolution and paternity agreements and/or orders include a provision allowing a specified parent to claim a child. Form 8332, available on the IRS website should be filled out every year where one spouse is entitled to take the dependency exemption.
The form essentially transfers the exemption from one parent to the other as long as certain conditions are met, such as child support is current. According to IRS chief counsel advice memo issued on June 19, 2009, for judgments or decrees after July 2, 2008, attaching a copy of the decree that transfers the exemption to a non-custodial parent will not suffice to transfer the dependency exemption.
A document that conforms to the substance of Form 8332 will suffice as long as that document’s only purpose is the release of a claim to the exemption. Therefore, any agreements to transfer the dependency exemption should contain a requirement that Form 8332 be executed every year.
Furthermore, the party receiving the dependency exemption should notify their CPA or tax preparer every year of this requirement. To access the 8332 form click this link, http://www.irs.gov/pub/irs-pdf/f8332.pdf.
If you have any further questions with regard to tax implications regarding your child(ren), or other legal issues, please contact The Marks Law Firm at (407) 872-3161.