Child and Dependent Care Credit Form 2441 Involving Divorced Taxpayers who Share Custody of Child

[CEB]

Wife is divorced from husband.  Wife and husband have one child who was born in 2019.  They share custody.  In the even years, she claims the dependency exemption and in the odd years her ex-husband claims the dependency exemption.  I am preparing the 2021 tax return for the wife, the year in which her ex-husband is claiming the dependency exemption for the child.  In 2021, the wife, my client, said her child lived with her 60% of the time and lived with the ex-husband 40% of the time.  She incurred child and dependent care costs in 2021 at a day care facility.

Can she claim the child and dependent care credit on her 2021 tax return even though she is not claiming the child as a dependent on her tax return?

[Terry53029]

Yes

[rbynaker]

I'd like to downgrade that to a solid Maybe. 🙂

There's no such thing as joint custody in the IRC.  It comes down to counting nights.  The "custodial parent" is the one who wins the night count.  See page 4 of Pub 503 (2021):

https://www.irs.gov/pub/irs-pdf/p503.pdf

"The custodial parent is the parent with whom the child
lived for the greater number of nights in 2021. If the child
was with each parent for an equal number of nights, the
custodial parent is the parent with the higher adjusted
gross income. For details and an exception for a parent
who works at night, see Pub. 501.

The noncustodial parent can't treat the child as a quali-
fying person even if that parent is entitled to claim the
child as a dependent under the special rules for a child of
divorced or separated parents."

Rick