Family
Your ex claims the child. You can still claim the earned income credit.
The parent the child lives with keeps the earned income credit and head of household, even when the other parent takes the child tax credit. It is one of the most common and most expensive mistakes on returns for divorced and separated parents. Here is why the benefits split, and how the right answer goes on the return.
Here is a return that shows up every tax season. A divorced parent, a child who lives with her most of the year, and a decree that says the other parent claims the child. So she files single, with no child on the return at all. That return is wrong, and it usually costs her several thousand dollars. The child tax credit can be handed to the other parent. The earned income credit and head of household cannot. They follow the child’s home, and no decree or signed form moves them.
Why the benefits split
“Claiming a child” is not one thing. It is five separate tax benefits, and they follow two different rules.
Two of them can be released to the other parent. When the custodial parent signs Form 8332, or a pre-2009 decree spells it out, the noncustodial parent takes the dependent and the child tax credit.
Three of them cannot be released. They stay with the parent the child lived with for more than half the year, whatever the decree says and whoever claims the dependent: the earned income credit, head of household filing status, and the child and dependent care credit. The IRS calls this the rule for children of divorced or separated parents, and it is written into the instructions for Form 1040 and Schedule EIC. The general rules for who claims a child when more than one person could are a separate article; this one is about the case where the parents have split the child up on purpose.
| Tax benefit | Parent the child lives with | Parent who claims the dependent |
|---|---|---|
| Dependent exemption | No | Yes |
| Child tax credit ($2,200 for 2026) | No | Yes |
| Earned income credit | Yes | No |
| Head of household filing status | Yes | No |
| Child and dependent care credit | Yes | No |
So two returns can carry the same child’s Social Security number and both be right. The noncustodial parent’s return shows the child as a dependent and takes the child tax credit. The custodial parent’s return shows the child for the earned income credit and head of household only, with no dependent and no child tax credit. The decree or Form 8332 explains the first return; where the child lived explains the second. A custodial parent who also pays for child care so she can work keeps the dependent care credit on the same reasoning.
What the custodial parent has to show
Three tests, and all three must hold.
The child lived with you more than half the year. Seven months is enough. Keep school records, medical records, or a lease that shows the child’s address, because that is what the IRS asks for if it asks.
You were unmarried on December 31. Divorced counts. Legally separated under a court decree counts. Separated but still married is a different set of rules (the considered-unmarried test), so ask your preparer before assuming either way.
You paid more than half the cost of keeping up your home. Rent or mortgage, utilities, groceries, repairs. This is the test for head of household only; the earned income credit does not require it. A parent living with a partner or a relative who covers most of the household may still have the EITC and not head of household.
Worked example: one child, $25,000 of wages, tax year 2025
A divorced mother earns $25,000. Her 11-year-old lives with her seven months of the year. Her ex claims the child under their decree and takes the child tax credit.
| Line | Filed single, no child | Filed correctly |
|---|---|---|
| Filing status | Single | Head of household |
| Standard deduction (2025) | $15,750 | $23,625 |
| Federal earned income credit | $0 | about $3,900 |
| Colorado EITC and child tax credit | $0 | about $2,500 |
| Child tax credit | $0 (ex claims it) | $0 (ex still claims it) |
| Difference, federal and Colorado together | about $7,000 |
Figures rounded. Colorado’s credits ride on the federal qualifying child, so they came along once the federal side was right. Nothing was taken from the other parent.
Already filed as single? Amend it.
The fix is Form 1040-X and an amended Colorado return. You generally have three years from the original due date to amend and collect the refund; for a 2025 return, that is April 2029. If a preparer filed it as single, the return can still be corrected, and the preparer who does it will want to see the original. This amendment is routine.
If both parents end up claiming the earned income credit or head of household on the same child, the IRS does not split the difference. It applies a tiebreaker and awards the benefit to the parent the child lived with longer. The custodial parent wins that outright; it is the other return that gets corrected. Nothing on the other parent’s return changes when the custodial parent amends, because the other parent keeps the child tax credit he claimed.
Behind the scenes
This is where most of the mistakes happen, because the child has to be on the return in a way that gives the custodial parent the earned income credit and head of household without giving her the child tax credit. The preparer enters the child in the dependents section with the actual months the child lived in the home, then marks the child as not claimed as a dependent this year, so the software drops the child tax credit and keeps the child flagged for the EITC; page 1 of the 1040 should show zero dependents. Filing status is set to head of household with the child’s name and Social Security number in the space for a qualifying person who is a child but not your dependent. On Schedule EIC the child’s number has to be a Social Security number, not an ITIN, or the credit calculates at zero. The worksheet will ask whether the child could be the qualifying child of another person; the honest answer is yes, because the child is also the ex’s qualifying child, and the divorced-parents rule resolves it. If the software stops with “cannot take the credit,” the usual cause is an entry problem, and the preparer fixes the entry rather than overriding the calculated answer, since overrides on calculated fields cause e-file rejects. On a 1040-X the explanation in Part II says that the taxpayer is the custodial parent, the child lived with the taxpayer more than half the year, the filing status is corrected to head of household, and the child is claimed for the earned income credit and head of household only, with the noncustodial parent claiming the dependent and the child tax credit under the rules for children of divorced or separated parents. That paragraph usually keeps the duplicate-claim notice from going out. The preparer’s due-diligence checklist, Form 8867, still applies, and the residency answer is the one to document.
The one question that comes first
For any unmarried parent with a child in the household, one question comes before anything else: who did the child live with most of the year? Not who claims the child. Who the child lived with. If the answer is “me” and the return is single with no child on it, the return deserves a second look. The decree settles who takes the dependent and the child tax credit. It does not settle, and cannot settle, where the child lived, and that is the fact the earned income credit and head of household are built on.
The Colorado side
Colorado’s earned income credit and child tax credit ride on the federal qualifying child. Once the federal return shows the child for the earned income credit and head of household, the Colorado credits come along with it; in the example above they were worth about $2,500 on top of the federal difference. The fix for a return already filed as single is the federal 1040-X and an amended Colorado return filed together, and the same three-year window applies to the Colorado refund. The state’s page on its credit is linked under Sources below.
What to bring your preparer
- The return that was filed, if you are amending
- The divorce decree or separation agreement, and any Form 8332 you signed
- The child’s Social Security card and date of birth
- Something showing the child’s address during the year: school records, medical records, a lease
- Rent or mortgage, utility and grocery records if there is any question about who paid for the household
Questions people ask
My decree says my ex claims the child in odd years. Does that take away my earned income credit in those years?
No. The decree can move the dependent and the child tax credit. It cannot move the earned income credit, head of household, or the dependent care credit. Those stay with the parent the child lives with every year.
My ex already filed and claimed the child. Will my amended return be rejected?
A 1040-X is not rejected for a duplicate Social Security number the way an original e-file is. If your ex also claimed the EITC or head of household on the same child, the IRS writes to both of you and applies the tiebreaker. Your residency records settle it.
We split time exactly 50/50. Who gets it?
Count nights. If it is truly equal, the parent with the higher adjusted gross income gets the child for all five benefits. There is no releasing the EITC by agreement.
Do I have to tell my ex?
No. Nothing on his return changes. He keeps the child tax credit he claimed.
The decree moves two benefits. The child’s home decides the other three.
A parent whose child lived with her most of the year and who filed single with no child on the return has very likely left several thousand dollars with the IRS. The amendment is routine, the window is three years, and the other parent loses nothing.
Published by The Tax Shop, Lone Tree, Colorado
Charles Trautman, EA · taxshop.tax · 303-734-1040