Should a parent claim on taxes a child that doesn't live with him and then he doesn't buy that child anything when he gets taxes back?

A parent cannot claim a child that does not live with the parent unless the other parent gives the non-custodial parent a completed Form 8332 that the non-custodial parent files with their tax return. In order to legally execute Form 8332, the 2 parents must provide more than half of the child's total support between them.

With Form 8332 attached, the non-custodial parent gets the child's exemption and the Child Tax Credit. All other tax benefits, such as Head of Household filing status, EIC, and Child Care Credit, remain with the custodial parent if the custodial parent is otherwise eligible to claim them. Those tax benefits can never be passed to the non-custodial parent.

What someone does with their tax refund is not a factor an who can legally claim the child. Nor is the amount of support provided by any one parent.

Who DOES the child live with? for how long?

The non-custodial parent cannot only claim the child if they receive a signed 8332 from the custodial parent.

Tax laws required that the combined support from both parents is more than half of the child's total support in order to transfer the claim via form 8332. For example if child, mother and grandmother live together with Grandmother providing financial support for the child, then the mother cannot grant tax benefits to the father via 8332.

Form 8332 ONLY transfers the dependency exemption and child tax credit, The custodial parent would still have the right to claim other tax benefits such as head of household status, earned income credit and daycare credits if applicable.

None of the rules depend on a "who files first" criteria. If the child's father files first and illegally claims the children then you should file a paper return also claiming the children. The IRS will investigate the duplicate claim and award the tax benefits to the whoever had the valid legal right to claim them. It could delay the refund, but you'll eventually get it.

If this has been going on for a while and you concerned by simply not claiming the children on your return then I suggest you take copies of your old returns to a tax preparer to file amendments. Do not just walk in to the local tax store and try to do this with the first clerk available. Call ahead, explain your situation and ask to make an appointment with a senior level preparer. You can amend your returns up to 3 years back and could have a huge payday coming.

Yes

the only way he is allowed to claim the child is if the custodial parents lets him and then custodial parent should negotiate receiving 50% of the tax benefit paid in advance by the other parent

He legally cannot claim said child without a signed from 8332 form the custodial parent.

that parent cannot claim the child unless the parent the child lives with signs the #8332 waiver to allow them to do so

Claiming a child as a tax dependent has nothing to do with what you "buy the child."

It has everything to do with meeting the criteria listed in IRS Publication 501.

The questions should have started with "can" not "should." Can they pull this off, possibly. Of course they shouldn't, there is no question about whether anyone would consider this to be right or wrong. Whether or not its legal is another story entirely.

**** no