HF 446

as introduced - 89th Legislature (2015 - 2016) Posted on 03/10/2015 07:55am

A bill for an act
relating to family law; allowing allocation of income tax dependency exemptions
in child support matters; amending Minnesota Statutes 2014, section 518A.38,
by adding a subdivision.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2014, section 518A.38, is amended by adding a
subdivision to read:

new text begin Subd. 7. new text end

new text begin Income tax dependency exemptions. new text end

new text begin (a) The court may allocate income
tax dependency exemptions for a child and require a party who has the child in the
party's physical custody for more than one-half of the calendar year to provide a properly
executed declaration that releases the party's claim to the child as a dependent under
section 152(e) of the Internal Revenue Code of 1986, as amended, to the other parent.
new text end

new text begin (b) In determining the allocation under paragraph (a), the court shall consider the
following:
new text end

new text begin (1) the financial resources of each party;
new text end

new text begin (2) if not awarding the dependency exemption negatively impacts a parent's ability
to provide for the needs of the child;
new text end

new text begin (3) if only one party or both parties would receive a tax benefit from the dependency
exemption; and
new text end

new text begin (4) the impact of the dependent exemption on either party's ability to claim a
premium tax credit or a premium subsidy under the federal Patient Protection and
Affordable Care Act, Public Law 111-148, as amended, including the federal Health Care
and Education Reconciliation Act of 2010, Public Law 111-152, and any amendments to,
and any federal guidance or regulations issued under, these acts.
new text end

new text begin (c) The court may place reasonable conditions on a party's right to claim an
exemption, including a requirement that the party remains in compliance with a child
support obligation.
new text end

new text begin (d) A party with less than ten percent of court-ordered parenting time shall not be
entitled to receive a dependency exemption except by agreement of the parties.
new text end

new text begin (e) The court may issue an order to modify a prior allocation of an income tax
dependency exemption upon a showing of substantial change in the factors under
paragraph (b).
new text end

new text begin (f) If allocation of an exemption is contested, the court must make findings
supporting its decision on the allocation.
new text end

new text begin (g) When a party has claimed an income tax dependency exemption in violation of
a court order or applicable law, or has failed or refused to provide a properly executed
written declaration that releases the party's claim to a child as a dependent to the other
party as required by a court order, the court may issue an order requiring compensation
in the amount of the lost benefit and reasonable costs and fees, to the party who was
wrongfully deprived of the income tax dependency exemption. A motion for such relief
must be brought within a reasonable time, but in no event later than three years from the
date of the filing of the return in which the exemption was claimed or could have been
claimed. A party who brings a meritless motion for such relief may be ordered to pay
reasonable costs and fees to the other party.
new text end