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  1. #1

    Default Can You Claim a Dependent Exemption for Unrelated Children Who Reside With You

    I have lived with my fiancé for 5 years now. In 2013 we won sole custody of his 3 children. They have lived with us ever since and have seen their birth mother once in the last 3 years.

    When we got custody it became clear that one person would have to stay home full time because one was a toddler, one had Autism, and one suffered from PTSD (he was afraid to leave the house and would wake up screaming in the middle of the night) as a result of their mother's boyfriend skinning a still-alive deer in front of him. We made the decision that he would stay home, since he was their father and I was little more than a stranger to them. I also made twice what he made, so it was the better option.

    Fast-forward to this year when I filed taxes. During 2015 the kids lived with my full-time and I provided 100% of their support, aside from medical expenses that their insurance covers. I claimed them on my 2014 taxes without issue and this year I am being audited because their mother claimed them in her state, even though it's been 3 years since she's seen them.

    Going through the paperwork they sent I see that I must provide letters from healthcare providers and the school to prove that they lived with me (I have this). But we are not legally married and therefore they are not technically my step-children, even though I have acted and been seen by them as their mother for 3 years.

    I guess my basic question is, what is the best way to handle this? No matter what their mother did not support or even see them during 2015. I lived with them and supported them, among other things, but I am not legally related to them. I am afraid that I will be penalized and barred from ever using EIC again. However, it does state that I "may still be eligible for EIC without a qualifying child." And I also received a letter stating that I "may be eligible for additional child credit".

    What are the best documents to provide? I want to provide as much as possible to illustrate that I financially supported them.

    Can I legally claim these 3 children?

    Am I in any trouble?

  2. #2
    Join Date
    Mar 2013
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    18,340

    Default Re: Can I Claim 3 Kids That Live with Me and I Support if They Are Not My Relatives

    According to Page 27 of IRS Publication 17 your dependent can be a Qualifying Child without being a relative:

    https://www.irs.gov/pub/irs-pdf/p17.pdf

    Starting on Page 31 there are additional rules if two people claim the same dependents.

    There is a tax attorney who participates here so stick around for additional help.

  3. #3
    Join Date
    Oct 2014
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    Default Re: Can I Claim 3 Kids That Live with Me and I Support if They Are Not My Relatives

    The problem here is that there are two very specific, detailed rules regarding who may claim the dependent exemption. One is called the qualifying child test. The second is called the qualifying relative test.

    One of the requirements for the qualifying child test is that the child must be your son, daughter, stepchild, foster child, brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant of any of them. As you are not related to these children and are not their step-parent you cannot claim an exemption for them under the qualifying child test.

    That leaves the qualifying relative test. Under that test, someone unrelated to the child may claim the child as a dependent but only if ALL of the following conditions are met:

    • The child can’t be your qualifying child or the qualifying child of any other taxpayer.
    • The child must live with you all year as a member of your household.
    • The child’s gross income for the year must be less than $4,000.
    • You must provide more than half of the person's total support for the year.
    • The child must be a U.S. citizen or resident, or a resident of Canada or Mexico.
    • The child must not file a joint tax return with another person.
    • You yourself must not be able to be claimed as someone’s dependent.


    The first item on that list, which the one I put in bold, is the one that is a potential problem for you. If anyone is eligible to claim the kids under the qualifying child test then no one may claim the child under the qualifying relative test. If a parent is eligible to claim a child under the qualifying child test, that parent gets to claim the exemption and no other relative may claim the kid under the qualifying child test either.

    So, let’s look at the parents as a start. One of the key requirements for the qualifying child test is that the child must have lived in the home of the parent for more than half the year. It does not sound like the mother met that requirement, but their father, your fiancé, did meet that requirement. Assuming (as is likely) that your fiancé met the other requirements to be eligible to claim the kids as his qualifying children that would block you from being able to claim them. Instead, your fiancé would have had to do that on his return. There is just one exception that would allow you to claim the kids in this circumstance: they won’t be his qualifying children if he was not required to file a return that year and did not file a return other than to claim a refund of withheld income tax or estimated tax paid; he could not file and claim any other kind of credit. See IRS Publication 501, page 18, for this rule.

    So, was your fiancé required to file a return for 2014 or 2015? And if not, did he file anyway and if he did, what did he claim?

    Also, is there any court order between your fiancé and his ex that gives her the right to claim the kids? If so, that’s going to be a problem for you, which I will explain in more detail if it turns out there is an order that gives the exemption to her.

  4. #4

    Default Re: Can I Claim 3 Kids That Live with Me and I Support if They Are Not My Relatives

    Our court orders state that the tax credit can only go to one parent and its whomever the kids live with. My fiancé has sole physical custody of all three of them and has maintained it since 2013. In 2014 she filed to try to take them back to her state and the judge denied it because she had not seen or spoken to them in a year and half.

    He did not files taxes in 2014 or 2015. He is strictly a stay at home parent now. He provides the care and transport of the children while I work. I work full-time and always during school hours. We do not receive any form of financial or child support from the mother.

  5. #5
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    Default Re: Can I Claim 3 Kids That Live with Me and I Support if They Are Not My Relatives

    Quote Quoting thedoppelganger
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    Our court orders state that the tax credit can only go to one parent and its whomever the kids live with. My fiancé has sole physical custody of all three of them and has maintained it since 2013. In 2014 she filed to try to take them back to her state and the judge denied it because she had not seen or spoken to them in a year and half.

    He did not files taxes in 2014 or 2015. He is strictly a stay at home parent now. He provides the care and transport of the children while I work. I work full-time and always during school hours. We do not receive any form of financial or child support from the mother.
    Ok, if he did not have enough taxable income to be required to file a return for 2014 and 2015 then because he did not file a return the kinds would not be his qualifying children under the exception I gave you earlier. His ex does not meet the qualifying child test either because the kids did not live with her for more than half the year either year. Assuming that no other relative of the kids lived with you (e.g. their grandparents, etc) then it appears that no one qualified to claim the kids under the qualifying child rule. That meets the first thing I mentioned for you to claim the kids under the qualifying relative test. You’ll want to explain that to the IRS as I did here. You will then need to show you meet the other requirements, too. The key ones that the IRS will most focus on will be the requirements that the kids lived with you as a member of your household for the entire year, that you provided over half their support, and that the none of the kids had over $4,000 in taxable income. If you have documentation to provide for all that you should be fine.

  6. #6
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    Oct 2006
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    16,474

    Default Re: Can I Claim 3 Kids That Live with Me and I Support if They Are Not My Relatives

    Quote Quoting Taxing Matters
    View Post
    Ok, if he did not have enough taxable income to be required to file a return for 2014 and 2015 then because he did not file a return the kinds would not be his qualifying children under the exception I gave you earlier. His ex does not meet the qualifying child test either because the kids did not live with her for more than half the year either year. Assuming that no other relative of the kids lived with you (e.g. their grandparents, etc) then it appears that no one qualified to claim the kids under the qualifying child rule. That meets the first thing I mentioned for you to claim the kids under the qualifying relative test. You’ll want to explain that to the IRS as I did here. You will then need to show you meet the other requirements, too. The key ones that the IRS will most focus on will be the requirements that the kids lived with you as a member of your household for the entire year, that you provided over half their support, and that the none of the kids had over $4,000 in taxable income. If you have documentation to provide for all that you should be fine.
    I do not think that the problem is going to be that she could claim the children as qualifying relatives. The problem is that I am pretty sure that she claimed them as qualifying children.

    OP, the only thing that you could have been eligible to claim was the children's exemptions. You could not claim EIC, the Child Tax Credit, Additional Child Tax Credit, Daycare Credits etc.

    If you and dad were actually married they would be your stepchildren and you could claim them as qualifying children.

  7. #7
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    Default Re: Can I Claim 3 Kids That Live with Me and I Support if They Are Not My Relatives

    Quote Quoting thedoppelganger
    View Post
    Our court orders state that the tax credit can only go to one parent and its whomever the kids live with. My fiancé has sole physical custody of all three of them and has maintained it since 2013. In 2014 she filed to try to take them back to her state and the judge denied it because she had not seen or spoken to them in a year and half.

    He did not files taxes in 2014 or 2015. He is strictly a stay at home parent now. He provides the care and transport of the children while I work. I work full-time and always during school hours. We do not receive any form of financial or child support from the mother.
    YOU are not a party to the court orders. So therefore they are not "our court orders" .. NOR are you the children's mother and you better discourage them from calling you such.

  8. #8

    Default Re: Can You Claim a Dependent Exemption for Unrelated Children Who Reside With You

    Ohiogal, the purpose of this thread is to ask a question about tax law and nothing else.

    Whether or not they call me "mom" has nothing to do with my question.

    What is the best way to go about my response then?

    What are key documents to provide? From the IRS letter I gather that letters from the school/healthcare providers are needed. It also states rent receipts and utility bills showing that I paid the bills at the address we live at.

    Should I write a cover letter explaining the situation?

    I'm just trying to understand this to the best of my ability so that I can respond in a timely and complete matter.

  9. #9
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    Default Re: Can You Claim a Dependent Exemption for Unrelated Children Who Reside With You

    Quote Quoting thedoppelganger
    View Post
    Ohiogal, the purpose of this thread is to ask a question about tax law and nothing else.

    Whether or not they call me "mom" has nothing to do with my question.

    What is the best way to go about my response then?

    What are key documents to provide? From the IRS letter I gather that letters from the school/healthcare providers are needed. It also states rent receipts and utility bills showing that I paid the bills at the address we live at.

    Should I write a cover letter explaining the situation?

    I'm just trying to understand this to the best of my ability so that I can respond in a timely and complete matter.
    Since I am still unclear as to how you claimed them (as qualifying children or qualifying relatives) and you have shown no inclination to give specific information about that, all I can suggest is that you get yourself to a tax professional ASAP and let them assist you.

  10. #10
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    Default Re: Can You Claim a Dependent Exemption for Unrelated Children Who Reside With You

    Quote Quoting thedoppelganger
    View Post
    Ohiogal, the purpose of this thread is to ask a question about tax law and nothing else.

    Whether or not they call me "mom" has nothing to do with my question.

    What is the best way to go about my response then?

    What are key documents to provide? From the IRS letter I gather that letters from the school/healthcare providers are needed. It also states rent receipts and utility bills showing that I paid the bills at the address we live at.

    Should I write a cover letter explaining the situation?

    I'm just trying to understand this to the best of my ability so that I can respond in a timely and complete matter.
    It matters to the bigger question however -- of the children. You need to realize that.

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