Mr Danczuk previously said he checked the claims with IPSA and has done nothing wrong.
Under parliamentary rules MPs can claim up to £2,425 per child, per year, to help with costs associated with them living in rented accommodation in London during the week or at weekends and school holidays.
But a source close to the expenses watchdog IPSA warned MP's' children must "regularly" stay with them in order to qualify for the extra support for travel and other costs.
They told The Telegraph: "If an MP knowingly claimed the allowance even if their dependents aren't regularly staying at the address that would be quite serious".
Routinely is understood to meet a number of times a month, either at weekends or a few nights during the week, although the rules do not spell out set limits.
Under the allowance Mr Danczuk, who has two children with his ex-wife Karen Danczuk and two with his first wife Sonia Rossington, claimed the full amount for his four children.
This is the vagaries of a complicated family, I have two children from a previous marriage and two from a more recent previous marriage and the two youngest have stayed there on a regular basis. I have been doing all I can to get my two eldest children to spend time with me and my other children in London but because of my first wife that's proving difficult.
Simon Danczuk MP
IPSA’s records show that in 2014-15 he claimed £28,466.58 and declared four dependents. In 2013-14 it was £27,587.46, and in 2012-13 it was £29,261.62.
The investigation could lead to Mr Danczuk having to repay the money he claimed.
Mr Danczuk lives in a two bedroom flat in Pimlico, just down the river from Westminster. Under the allowances system he is entitled to claim extra money to allow his dependents to stay with him at the property.
The MP's handbook states they can claim: "A supplement of up to £2,425 a year for each dependent you care for. You will need to certify that the dependent routinely lives with you."
Mr Danczuk told the Telegraph that IPSA does not do enough to support modern families like his, that do not easily fit into strict boxes and limits.
He said: "I checked with IPSA when I made the claim and they reassured me that it was acceptable.
"This is the vagaries of a complicated family, I have two children from a previous marriage and two from a more recent previous marriage and the two youngest have stayed there on a regular basis.
"I have been doing all I can to get my two eldest children to spend time with me and my other children in London.
"All four children have stayed together and on numerous occasions and I had always hoped that would continue but it hasn't.
"This is an example of the complexities of real life and you can design as many rules as you want but this is just how modern families work nowadays."
The MP accepted that he has a more "colourful" family life than other MPs but warned the expenses watchdog's rules are "at fault" because they are not designed for difficult family circumstances.
He added that it would be "nonsense" for IPSA to demand money back from him because it would force him to find another property which would be problematic if all four children did come to stay at the same time.
Source: http://telegraph.feedsportal.com/c/32726/f/579309/s/4d44e755/sc/13/l/0L0Stelegraph0O0Cnews0Cnewstopics0Cmps0Eexpenses0Clabour0Emps0Eexpenses0C121188160CInvestigation0Eopens0Einto0Esuspended0ELabour0EMP0ESimon0EDanczuks0Eexpense0Eclaims0Bhtml/story01.htm