Final regs. clarify "counting nights" rule for dependents.

• Author: Nevius, Alistair M.
• Position: Regulations

When a child of divorced or separated parents lives with both of them during the year, the right to claim the dependency exemption may be released by the "custodial parent" (Sec. 152(e)). The custodial parent is defined as the parent with whom the child resides for the longest period of time during the year (Sec. 152(c)(4)(B)). Proposed regulations defined "custodial parent" as the parent with whom the child resides for the greater number of nights during the year (REG-149856-03).

Practitioners have asked the Service to clarify the term "night" when determining the child's residence. For example, is it determined by the child's location at midnight (or some other time), or by where the child sleeps that night? And in which year is the night that spans December 31 and January I counted?

The Service...