Since the Tax Cuts and Jobs Act (TCJA) passed into law, the deduction for personal exemptions is suspended for tax years 2018 through 2025.
Although the exemption dollar amount is zero, eligibility to claim an exemption may make you eligible for other tax benefits.
Between custodial and noncustodial parents, it’s important to determine who may claim:
- the child tax credit
- the additional child tax credit
- the credit for other dependents
- as well as other tax benefits.
3 big things to know about IRS Tax Form 8332
- Tax Form 8332 is the form custodial parents can use to release their right to claim a child as a dependent to the noncustodial parent.
- The form can be used for current or future tax years.
- Custodial parents can use Form 8332 to revoke the release of this same right.
The custodial parent is generally the parent with whom the child lived for the greater number of nights during the year. The noncustodial parent is the other parent. 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.
If you have questions about how to use Form 8332, contact the experts at Morgan & Associates for advice. We’re happy to help!