Dear Moneyist,
My ex-husband and I are court-ordered to rotate the years we claim our child’s tax credits, even though my child lives with him for less than half of the year. He doesn’t pay any of our child’s expenses, such as sports and equipment and school lunches. I have to furnish everything for both houses.
“ ‘I am the primary parent, the financially responsible party, and the one that’s trying to provide for our child during this pandemic.’ ”
I have a much lower income then my ex-husband: I earn about $20,000 a year, compared to the $70,000 my husband pulls in. My ex-husband’s year for claiming tax credits was 2019. He had already filed his taxes for last year, so he received the $500 stimulus payment for our son.
It’s my year to claim our son on my taxes with the Internal Revenue Service in 2020, so any tax benefits associated with 2020 should go to me, right? It’s my understanding that it will be reported on my taxes when I claim him for that year, even though my ex-husband thinks he should keep that $500 payment.
Should he have to give the payment to me, or is he right to keep it? I am the primary parent, the financially responsible party, and the one who’s trying to provide for our child during this pandemic. He only has him for weekend visitation during this time, and he’s still working full-time.
Feeling Cheated
Dear Feeling Cheated,
The combination of ethics, divorce agreements, the law and the IRS leads to a long and winding road filled with pot holes, sharp turns, speed bumps, spaghetti roundabouts, broken traffic lights, police checkpoints, confusing signage, multiple-car pileups, rusty relics from past lives gathering moss in the ditch, and wide-eyed hitchhikers who should be avoided.
Financially, you are obviously in a more precarious situation than your ex. What he should do and what he is legally entitled to do are two very different things. I can lay out actions you can take to restore this $500 to you. But you ultimately have no control over what happens next, or your ex-husband’s actions. That’s why you divorced. After you take these actions, I implore you to move on.
Option 1: Ask your ex for the $500. The CARES Act stimulus check is an advance payment of a refundable credit on your 2020 return, designed to help people who have lost jobs and/or are dealing with the inevitable economic downturn. A member of the Moneyist Facebook FB, +0.88% group has another idea: “After consulting King Solomon, your husband should send you $250.”
Option 2: Claim your child-tax credits next year in the hope the IRS recognizes that this $500 is due to you, gives you that money in your 2020 tax refund, and deducts the same amount from your ex-husband’s tax refund next year. However, whether or not you have bought furniture for your ex-husband’s home, this $500 should not be given to you twice, by him and also by the IRS.
If your ex-husband does give you the $500, and the IRS effectively moves the $500 from his 2019 taxes to your 2020 taxes, you will have a decision to make. Again, it’s an ethical one. Should you give the $500 to your ex, or should you keep it because of all the ways he has allegedly not acted appropriately or responsibly in the past? My suggestion: Give it back.
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The CARES Act was written hastily to deal with a public-health emergency and economic crisis that are still unfolding. No one knows how this will turn out. “It’s all brand new,” Randy Kessler, an Atlanta-based family attorney, told me when I mentioned your case to him. “These checks are being sent to whichever parent most recently filed taxes claiming the child as a dependent for 2019.”
“How else would the government know who is considered the parent responsible financially for the child?” he added. “It’s probably the simplest way for the government to determine this on such a large scale, because otherwise the government would have to search all court orders relating to custody and child support to see which parent has which obligations.” It’s far from a perfect system.
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And afterwards? Take the next right turn, keep your eye on the road, and don’t get distracted by voices in your head or your iPhone telling you what you’re owed and how he has done you wrong. That is detrimental to your health or, at the very least, spoil your day. You have this time with your son right here, right now. You may not get it back. For that reason, you win. You are the lucky one.
We are all that wide-eyed hitchhiker. I hope you and your son stay safe and healthy. Keep driving.
You can email The Moneyist with any financial and ethical questions related to coronavirus at qfottrell@marketwatch.com
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