1. Tax “custody” is different.
These days, family courts often award “joint” custody of a child–joint legal custody and sometimes joint physical custody too. In the tax world there is no such thing. Custody, meaning the $3,650 dependent exemption for a child and the $1,000 child tax credit belongs to the parent in whose home the child spends more nights.
What often happens in the real world is that parents with joint custody haven’t resolved who gets tax custody and so both claim the child. The parent who files his or her 1040 first gets the exemption/credit. When the second to file claims the child, his or her refund is held up. Both then receive an IRS notice saying a dependent was claimed twice, and requiring each to submit proof of entitlement to the dependent. So mark your calendars the nights your children stay with you so you will have “contemporaneous records” to prove your claim for tax custody. (Days may be used for parents who work nights.)
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