Opinion ID: 2293705
Heading Depth: 2
Heading Rank: 3

Heading: Allocation of Dependent Tax Exemptions

Text: [¶ 25] We review the court's allocation of dependent tax exemptions for an abuse of discretion. [3] See State ex rel. Pathammavong v. Pathammavong, 268 Neb. 1, 679 N.W.2d 749, 758 (2004); In re Marriage of Milesnick, 235 Mont. 88, 765 P.2d 751, 754 (1988). [¶ 26] Although it has authority to do so, [4] the divorce court did not allocate the four dependent tax exemptions as between Robert and Keri in the divorce judgment or in its blanket denial of Robert's motion to reconsider. As a result, pursuant to the Internal Revenue Code, all four exemptions may be claimed by Keri in a taxable year as the parent with primary residence of the children for the greater part of the year. 26 U.S.C.S. § 152(c)(4)(B), (e) (2011); see 26 U.S.C.S. § 151(a), (c) (2011); 36 M.R.S. § 5126 (2011). [¶ 27] This result is, however, contrary to the agreement of the parties, and, more importantly, see generally Tapman v. Tapman, 544 A.2d 1265, 1267 (Me.1988) (stating that a court is not bound by an agreement of the parties), contrary to the court's acknowledgement and apparent agreement to this allocation at the divorce hearing. The trial transcript unambiguously evidences the parties' agreement to allocate two of the four dependent tax exemptions to Robert, [5] and it reflects the court's statements that the divorce judgment would reflect that agreement. Additionally, the court referenced that allocation of dependent tax exemptions when considering Robert's tax liability at the divorce hearing, indicating that various aspects of the divorce judgment would be based on Robert's being allocated two dependent exemptions for tax purposes. [¶ 28] We therefore conclude that the court erred when it did not allocate two dependent exemptions to Robert.