Scarlett Posted March 20, 2012 Share Posted March 20, 2012 I have a 'friend', who has 2 children with an XW. Divorce decree says they each get to claim a child as a dependent. This year my friend is eligible for EIC....but only if the XW doesn't take the credit. We thought she wouldn't because she and her new husband have a total of 4 kids and you only get a benefit up to 3 kids. (and also we sort of thought they would exceed the income limits, but maybe not) But turns out she did take it for both kids. So in a very tense conversation my friend has with his XW she tells him she and her husband are doing their taxes seperatately. But.....according to IRS website you can't take the EIC if you are married filing seperately. So this means, almost positively means, that she lied and said she is single. It is costing my friend $2000 to not be able to claim the EIC on this child. What would you do? Quote Link to comment Share on other sites More sharing options...
magnificent_baby Posted March 20, 2012 Share Posted March 20, 2012 What is an EIC? My opinion is that he should take the credit according to the decree, regardless of what she files or claims. If she is being dishonest, she can deal with the consequences. Quote Link to comment Share on other sites More sharing options...
Melinda in VT Posted March 20, 2012 Share Posted March 20, 2012 No first-hand experience, but I'd claim the one child allowed in the divorce decree. I would not get involved in what the ex-wife is or is not doing with her taxes. Quote Link to comment Share on other sites More sharing options...
raceNzanesmom Posted March 20, 2012 Share Posted March 20, 2012 No first-hand experience, but I'd claim the one child allowed in the divorce decree. I would not get involved in what the ex-wife is or is not doing with her taxes. I agree. And if she went against that he needs to contact his lawyer. Quote Link to comment Share on other sites More sharing options...
Scarlett Posted March 20, 2012 Author Share Posted March 20, 2012 No first-hand experience, but I'd claim the one child allowed in the divorce decree. I would not get involved in what the ex-wife is or is not doing with her taxes. I probably was not very clear...but it isn't that she is going against the decree...she is lying to the IRS which is preventing us from taking a credit she is getting with her lie. Quote Link to comment Share on other sites More sharing options...
Scarlett Posted March 20, 2012 Author Share Posted March 20, 2012 What is an EIC? My opinion is that he should take the credit according to the decree, regardless of what she files or claims. If she is being dishonest, she can deal with the consequences. In our situation, the ex has to sign a form every year stating that we can claim such and such child for that year (there are also 2 children). EIC is earned income credit. The decree doesn't address EIC...only claiming a child as a dependent. We can only claim EIC if she doesn't. Quote Link to comment Share on other sites More sharing options...
Melinda in VT Posted March 20, 2012 Share Posted March 20, 2012 I probably was not very clear...but it isn't that she is going against the decree...she is lying to the IRS which is preventing us from taking a credit she is getting with her lie. No, I got it. But according to the divorce decree, that credit isn't yours. It's hers. Quote Link to comment Share on other sites More sharing options...
Scarlett Posted March 20, 2012 Author Share Posted March 20, 2012 No, I got it. But according to the divorce decree, that credit isn't yours. It's hers. It IS ours if she can't claim it. Quote Link to comment Share on other sites More sharing options...
Scarlett Posted March 20, 2012 Author Share Posted March 20, 2012 Just got off the phone with dh..he talked to our accountant and they told us the steps to take. We file a paper return, claiming the credit for EIC and our reasons, along with a suspected fraud report that will trigger an investigation. Let the IRS sort out who gets to claim it. Quote Link to comment Share on other sites More sharing options...
magnificent_baby Posted March 20, 2012 Share Posted March 20, 2012 EIC is earned income credit. The decree doesn't address EIC...only claiming a child as a dependent. We can only claim EIC if she doesn't. Not sure if this is even applicable, but if the kids are young, it may be worth it to get the decree modified (or clarified?) if this is something you will encounter each year. If it were me, I would NOT want to deal with this every single year. It doesn't seem right that you should have to check in yearly to see if she's claiming it or not. Quote Link to comment Share on other sites More sharing options...
Impish Posted March 20, 2012 Share Posted March 20, 2012 It all comes down to what your dh is willing to do. Is he willing to call the IRS and report the issue, and ask them for advice? It could open a huge can of worms, w/potentially massive fall out. Quote Link to comment Share on other sites More sharing options...
magnificent_baby Posted March 20, 2012 Share Posted March 20, 2012 Just got off the phone with dh..he talked to our accountant and they told us the steps to take. We file a paper return, claiming the credit for EIC and our reasons, along with a suspected fraud report that will trigger an investigation. Let the IRS sort out who gets to claim it. Glad you have an accountant to help! Trust me, it stinks to deal with dishonesty. Quote Link to comment Share on other sites More sharing options...
Scarlett Posted March 20, 2012 Author Share Posted March 20, 2012 Not sure if this is even applicable, but if the kids are young, it may be worth it to get the decree modified (or clarified?) if this is something you will encounter each year. If it were me, I would NOT want to deal with this every single year. It doesn't seem right that you should have to check in yearly to see if she's claiming it or not. This should be the only year we will ever qualify for EIC. But still $2000 would help us out a whole bunch right now after dh being underemployed for a full year. Quote Link to comment Share on other sites More sharing options...
Scarlett Posted March 20, 2012 Author Share Posted March 20, 2012 It all comes down to what your dh is willing to do. Is he willing to call the IRS and report the issue, and ask them for advice? It could open a huge can of worms, w/potentially massive fall out. Well, we have nothing to hide but clearly they are lying. And it isn't as if they have been easy to deal with on ANYTHING. So we don't have much to lose. I think dh wants to report it due to how much her lie is costing our bottom line. Quote Link to comment Share on other sites More sharing options...
sparkygirl Posted March 21, 2012 Share Posted March 21, 2012 (edited) You need to check with a family law lawyer as well as your accountant and the exact wording of your divorce decree and the custody agreement. If mom has primary physical custody while the divorce decree grants dad the right to claim the child he does not get to claim the added credits that go along with that child. Those are the 'benefit' of the custodial parent. There is an IRS booklet that specifically addresses the child tax credits and other credits that spells out each situation and what can or can not be done by the custodial or non custodial parent. I say this from the point of view of the working bonus mom with a stay at home husband, two bonus kids and an "ours" daughter. I've been through the I hope she didn't claim this as it will flag an audit even though it is our year. Thankfully now we are joint physical and legal so the rules have changed a bit. Edited March 21, 2012 by sparkygirl Quote Link to comment Share on other sites More sharing options...
Scarlett Posted March 21, 2012 Author Share Posted March 21, 2012 You need to check with a family law lawyer as well as your accountant and the exact wording of your divorce decree and the custody agreement. If mom has primary physical custody while the divorce decree grants dad the right to claim the child he does not get to claim the added credits that go along with that child. Those are the 'benefit' of the custodial parent. There is an IRS booklet that specifically addresses the child tax credits and other credits that spells out each situation and what can or can not be done by the custodial or non custodial parent. I say this from the point of view of the working bonus mom with a stay at home husband, two bonus kids and an "ours" daughter. I've been through the I hope she didn't claim this as it will flag an audit even though it is our year. Thankfully now we are joint physical and legal so the rules have changed a bit. We already know she claimed the EIC on him--We get that that is her 'right', benefit' whatever of being the custodial parent... We also know she lied and said she is single when she is not. So she can't claim him. If she can't claim him, we can. Dh is ready to go through with it even though Holy Heck will break lose. Quote Link to comment Share on other sites More sharing options...
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