Taxes for the Single Father – Are You Eligible for Added Deductions?
Learn about Special Tax Deductions and IRS Considerations for Single and Divorced Fathers
Taxes are so confusing! Nearly everyone dreads the process of filing annual tax returns. Taxes for single dads are especially worrisome. Single moms far outnumber single dads, and the dads may well wonder if the tax code is stacked against them. The good news is that the tax code, for all its faults, largely bends over backwards to be gender neutral. Taxpayers are evaluated by such factors as age, marital status, dependents, income and deductions, not on whether they are male or female.
– Learn more about Divorce and taxes
We start by recognizing what a dependent is and how they benefit parents. In general terms, a dependent is a person that a taxpayer supports. Most commonly, if the child is your child by birth or adoption, he or she lives with you and you provide more than half their support, the child qualifies as a dependent. There are specific rules for borderline cases such as split custody, siblings, nieces or nephews, college students and other situations. The complete rules with examples are found in IRS Publication 17, chapter 3, or IRS Publication 501, page 11. Both of these are found on the website www.irs.gov.
There are six possible tax benefits for claiming a child as a dependent:
- Dependency Exemption
- Head of Household Filing Status
- Child Tax Credit and Additional Child Tax Credit
- Child and Dependent Care Credit
- Earned Income Credit
- Exclusion From Income For Dependent Care Benefits
Not every taxpayer will be eligible for each of these benefits on every tax return, as each has its own rules and restrictions. But the important aspect of this list is that, with one limited exception, a taxpayer who is able to claim a child as a dependent may also claim that child for any of these other benefits for which the taxpayer qualifies. In that case neither the other parent nor any other person can use that same child for any of these benefits. In addition, if a college student qualifies as a dependent, the parent may claim any education deductions or credits generated by that student on the parent’s return.
Single father tax deductions are possible whether the child lives with the father full time, part time or not at all. Count the number of nights the child stays with you during the year. If the total is more than half, or at least 183 nights per year, then that parent is the custodial parent and has first right to claim that child as a dependent and the tax benefits that go with it. If the father is the non-custodial parent with less than 183 nights with the child, then the mother is allowed to give the father permission to claim the child as a dependent. This is the exception mentioned earlier. In that case the father may claim the dependency exemption, child tax credit and additional child tax credit and the mother claims the remaining benefits. This permission is granted for one or more specific years by using IRS Form 8332 signed by the custodial parent. This exception is available whether or not the parents have ever been married and does not depend on the amount of child support provided by either parent.
For parents with incomes below approximately $46000, the Earned Income Credit may reduce single father taxes and increase refunds even after their tax liability is reduced to zero. This generous credit for lower income working people specifically goes to the custodial parent, regardless of who actually claims the child as a dependent. IRS Publication 17, chapter 36 and IRS Publication 596 spell out the details of this important tax benefit.