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Does it depend on how much money you make to get more money back when you claim a child on income tax?
My daughters father made more money than me this year.. So should he claim our newborn so we can get more money back?
5 Answers
- Cathi KLv 79 years agoFavorite Answer
Hard to know without more info. You can each do your taxes with and without her and see which is best.
- 9 years ago
How much you get back should not be the primary focus. The lowest net tax liability should be. If one gets a large refund but the other pays a wad the large refund may not be the best bet.
Refunds depend upon your tax liability, how much tax was withheld, and any refundable credits that you qualify for. While common logic says that the parent with the larger income (I'm assuming that you're not married and all live together) gets the best benefit by claiming the child, refundable credits like the EIC can shift the numbers, sometimes drastically.
If the one with the higher income is in the 25% tax bracket they may get a total tax savings of about $1,925 from claiming the child, between the tax reduction for the child's exemption and the $1,000 Child Tax Credit. If the other parent's income is low, say $13,000, they get minimal benefit from the exemption itself but would pick up $3,094 from the EIC and $1,000 from the Additional Child Tax Credit. In that case it might be better for the parent with the much lower income to claim the child.
Ideally you need to figure your taxes all possible ways and go with whichever way results in the lowest total tax liability. (Don't forget to subtract any refundable credits in figuring the tax liability so that you are comparing apples with apples.) The one with the higher income can probably file as Head of Household but must claim the child to do so. The other would file as Single. However if it works out better that the parent with the lower income claims the child, you'd both file as Single since you must pay more than half of the costs of maintaining the home to file as HoH. (And at $13k of income in the above example, HoH would not make any difference anyway.)
- SlickterpLv 79 years ago
What you get back depends on what you had withheld, your filing status, your dependents, deductions, etc . Usually the person making the most gets the most benefit from claiming the child. That doesn't mean he will get more, or anything, back.
- troLv 79 years ago
assuming you are not married, the parent with whom the child spend the majority 'nites' with claims the child
if it cannot be determined which parent has the majority(you all live together) the parent with the higher income claims the child
if you are married, you claim the child on your joint return
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- JudyLv 79 years ago
Can't tell without actual numbers. The money you get back can go up or down if you make more.