Someone Claimed My Children as Dependents on Their Taxes in California — What Do I Do?

Why Was Your Tax Return Rejected?

The IRS e-file system automatically rejects any return claiming a Social Security Number already filed on another return. This is a surprisingly common problem — the IRS processed over 1.4 million identity theft cases in 2024, and roughly 16% involved dependent claims. Someone filed before you using one or both of your daughters' SSNs. The IRS cannot disclose who filed under federal privacy law (26 U.S.C. § 6103), but they will investigate and resolve the duplicate claim.

What Steps Should You Take Immediately?

First, do not panic and do not amend. Your return was rejected, not accepted incorrectly. Here is the sequence:

1. Paper-file your return with your daughters claimed as dependents. Attach Form 14039 (Identity Theft Affidavit) if you suspect fraud, or simply file on paper if you suspect a family member filed first.
2. Mail via certified return receipt so you have proof of timely filing.
3. Gather documentation proving your daughters lived with you all year: school records, medical records, daycare receipts, lease or mortgage showing the home address, and pediatrician statements.
4. Call the IRS Identity Protection Specialized Unit at 1-800-908-4490 if identity theft is suspected.

The IRS will send CP87A notices to both filers asking each to verify eligibility. Whoever cannot prove the qualifying-child relationship will owe back taxes plus penalties.

Who Wins Under the IRS Tiebreaker Rules?

Under IRC § 152(c)(4), when two taxpayers claim the same child, the IRS applies tiebreaker rules in this order:

• Parent over non-parent — a parent always beats a grandparent, aunt, or ex-partner.
• Custodial parent over non-custodial — the parent the child lived with longer wins.
• Higher AGI — if both parents had equal time, the higher earner wins.

Because you stated the girls have lived with you and your husband since birth and you have full custody, you automatically win this tiebreaker. If the filer was a non-custodial relative or an ex-partner, they had no legal right to claim the children.

Could This Relate to a Custody Dispute?

Sometimes a non-custodial parent or estranged relative claims children to trigger a dispute. In California, tax dependency claims can intersect with child custody and child support orders. Under Cal. Fam. Code § 4053, courts consider the tax consequences of dependency exemptions when setting support. If a non-custodial party claimed your daughters, review any existing family court orders — IRS Form 8332 is the only document that legally allows a non-custodial parent to claim a child.

For California-specific procedural questions, review California divorce resources and the California divorce checklist. If this turns out to involve a family dispute, find a family law attorney experienced in both tax and custody matters. You can also explore additional California divorce statistics and browse more Divorce Questions on similar tax and custody overlaps.

How Long Does Resolution Take?

Expect 6 to 9 months for full resolution. The IRS will process your paper return, issue your refund (likely delayed), and then open a CP87A investigation. Keep copies of everything. The IRS will not charge you penalties for filing on paper under these circumstances.

This is tax and procedural information, not legal advice — consult a CPA or family law attorney if the filer turns out to be a family member with a legal claim.