REVISED FORM 8332 PERMITS NEVER-MARRIED PARENTS TO WAIVE CHILD EXEMPTION
IRS has revised Form 8332 (Release of Claim to Exemption for Child of Divorced or Separated Parents) and IRS Pub No. 504 p. 8 (Divorced or Separated Individuals) to permit a never-married noncustodial parent to claim a dependency exemption where the custodial parent has waived this exemption. These changes show that IRS now agrees with the Tax Court’s holding in King, (2003) 121 T.C. No. 12, that the noncustodial parent was entitled to a dependency exemption because the custodial parent signed Form 8332 waiving the exemption.
Background of child dependency exemption. A dependency exemption generally is allowed for parents who provide over half of a child’s support during the calendar year. (Code Sec. 152(a)) Under a special support test, the parent with “custody” for a greater portion of the year is treated as providing more than one-half of a child’s support where the child receives more than half of his or her total support for the year from either or both parents: (a) who are divorced or legally separated, or (b) who are separated under a written separation agreement, or (c) who live apart at all times during the last six months of the calendar year. (Code Sec. 152(e)) The custodial parent may release (on Form 8332) the claim to the noncustodial parent. (Code Sec. 152(e)(2)(A))