Here is the story. My wife and I were divorced a few years ago - she has remarried but files separately from her new husband and they have 1 child. We have 3 children together with a divorce decree that states one year I can claim 2 as dependents and she can claim 1 with the following year reversed. We share the children 50/50 and share support. I claimed Head Of Household last year and want to do the same this year but she insists upon doing it. I know this will raise a flag to the IRS and I want to know what the ruling is in a situation like this. Hopefully, someone will be able to advise me correctly.

Please clarify - are you saying that your ex wants to claim all three children this year? Since you have a court order that says you can claim at least one every year, you can do so. You can attach a copy of the court decree to your tax return - take a look at Pub 501, page 21, the section titled "Post 1984 and pre 2008 Divorce decree or separation agreement": http://www.irs.gov/pub/irs-pdf/p501.pdf

No _ I am not saying she wants to claim 3 children this year at all - I said she wants to file as Head of Household and she remarried. The question is regarding the HOH!
Thanks.

No if she is married, she is not head of household unless she did not live with her spouse for last six months of the year.

Also if no child lives with you, you are not a head of household even if you may claim them as dependents as per court order.

For head of household you must be unmarried or did not live with your spouse for last six months of the year and have a qualifying dependent and pay more than half the cost of the household. Your U.S. Tax Return: Filing Status: Head of Household

MukatA: Thanks for your reply. We share custody 50/50 as far as living and expenses and one year I claim one child, she claims two and the following year I clean two and she claims one.
She is married and I am not so I think you answered my question perfectly - she cannot claim Head of Household!