T.C. Memo. 1996-560
UNITED STATES TAX COURT
GERALD REGINALD PAULSON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 433-96. Filed December 30, 1996.
Gerald Reginald Paulson, pro se.
Blaine Holiday, for respondent.
MEMORANDUM OPINION
COUVILLION, Special Trial Judge: This case was heard
pursuant to section 7443A(b)(3)1 and Rules 180, 181, and 182.
Respondent determined the following deficiencies in Federal
income taxes and additions to tax against petitioner:
1
Unless otherwise indicated, section references are to the
Internal Revenue Code in effect for the years at issue. All Rule
references are to the Tax Court Rules of Practice and Procedure.
- 2 -
Addition to Tax
Year Deficiency Sec. 6651(a)(1)
1991 $ 896 $100
1992 1,485 184
1993 1,290 79
After concessions by petitioner, the sole issue for decision
is whether petitioner is entitled to the dependency exemption for
his daughter, under section 151, for each of the years in
question.2
Some of the facts were stipulated, and those facts, with the
annexed exhibits, are so found and are incorporated herein by
reference. Petitioner was a legal resident of Anoka, Minnesota,
at the time the petition was filed.
Petitioner was divorced from his wife, Cindy Lou Paulson, on
September 28, 1990. Petitioner and his former wife had one child
of their marriage, a daughter, Candi Lynn Paulson, who was born
on August 3, 1975. In a "Second Amended Judgment and Decree",
dated December 24, 1990 (the decree), rendered by a Minnesota
State court, petitioner's former spouse was awarded "The
permanent sole legal and physical custody, care and control of
2
The dependency exemption is the only adjustment in the
notice of deficiency that was placed at issue in the petition.
At trial, petitioner affirmed his concession of disallowed
alimony payments for the 3 years at issue, taxable unemployment
compensation income for 1992, itemized deduction adjustments for
the 3 years at issue, and the addition to tax under sec.
6651(a)(1) for the 3 years at issue.
- 3 -
the minor child of the parties", with visitation rights accorded
petitioner. Petitioner was required to pay, for the support of
the minor child, $456 per month, in equal installments of $228 on
the 1st and 15th days of each month, commencing on October 15,
1990. The record does not show that, for the years in question,
there were any changes to this support requirement. The decree
also provided that "Petitioner shall have the right to claim the
minor child of the parties on his federal and state tax returns
provided that he has been current in his child support payments
throughout the calendar year and is current at the time of filing
his tax return." The decree further provided that petitioner's
former spouse "shall execute IRS Form 8332, Release of Claim to
Exemption for Child of Divorced or Separated Parents, in
accordance with present and future Internal Revenue Code
provisions and corollary state income tax forms, so that the
foregoing Order is fully implemented."
For each of the years at issue, petitioner claimed his
daughter Candi Lynn as a dependent on his Federal income tax
returns. However, the returns filed by petitioner did not have
attached thereto Internal Revenue Service (IRS) Form 8332 nor any
other statement executed by petitioner's former spouse that would
contain substantively the same information called for on Form
8332.
- 4 -
In the notice of deficiency, respondent disallowed the
dependency exemption claimed by petitioner on the ground that
petitioner had not established that he was entitled to the
dependency exemption. At trial, counsel for respondent agreed
that, for the years in question, petitioner was current in his
support obligations for his child; however, petitioner was not
entitled to the dependency exemption for the reason that
petitioner's former spouse, as the custodial parent, had not
released claim to the exemption for the years in question, which
release would be reflected on IRS Form 8332 or any other written
statement conforming thereto.
The determinations by the Commissioner in a notice of
deficiency are presumed correct, and the burden of proof is on
the taxpayer to prove that the determinations are in error. Rule
142(a); Welch v. Helvering, 290 U.S. 111 (1933).
Section 151(c) allows taxpayers an annual exemption amount
for each "dependent" as defined in section 152. Under section
152(a), the term "dependent" means certain individuals, such as a
son, daughter, stepson, or stepdaughter, "over half of whose
support for the calendar year in which the taxable year of the
taxpayer begins, was received from the taxpayer (or is treated
under subsection (c) or (e) as received from the taxpayer)".
The support test in section 152(e)(1) applies if: (1) A
child receives over half of his support during the calendar year
- 5 -
from his parents; (2) the parents are divorced under a decree of
divorce; and (3) such child is in the custody of one or both of
his parents for more than one-half of the calendar year. If
these requirements are satisfied, as in the present case, "such
child shall be treated, for purposes of subsection (a), as
receiving over half of his support during the calendar year from
the parent having custody for a greater portion of the calendar
year (* * * referred to as the 'custodial parent')", thus
allowing the dependency exemption to be claimed by the "custodial
parent".
To decide who has "custody", section 1.152-4(b), Income Tax
Regs., provides that custody "will be determined by the terms of
the most recent decree of divorce" if there is one in effect.
Since petitioner's divorce decree granted custody and physical
possession of petitioner's daughter to his former spouse, the
former spouse is considered the child's "custodial parent" under
section 152(e).
Petitioner, as the "noncustodial parent", is allowed to
claim the child as a dependent if any one of three statutory
exceptions in section 152(e) is met. Under these exceptions, the
"noncustodial parent" is treated as providing over half of a
child's support if:
(1) Pursuant to section 152(e)(2), the custodial parent
signs a written declaration that such custodial parent will not
- 6 -
claim such child as a dependent, and the noncustodial parent
attaches such written declaration to the noncustodial parent's
return for the taxable year;
(2) pursuant to section 152(e)(3), there is a multiple
support agreement between the parties as provided in section
152(c); or
(3) pursuant to section 152(e)(4), there is a qualified pre-
1985 instrument providing that the noncustodial parent shall be
entitled to any deduction allowable under section 151 for such
child, provided that certain other requisites, not pertinent
here, are met.
In the present case, the exceptions in section 152(e)(3) and
(4) do not apply. There was no multiple support agreement and no
pre-1985 instrument. Therefore, petitioner is entitled to the
dependency exemption only if the requirements of section
152(e)(2) are met.
Section 152(e)(2)(A) specifically requires that the
custodial parent sign "a written declaration (in such manner and
form as the Secretary may by regulations prescribe) that such
custodial parent will not claim such child as a dependent".
Pursuant to this statutory provision, temporary regulations
provide that, "The written declaration may be made on a form to
be provided by the Service for this purpose. Once the Service
has released the form, any declaration made other than on the
- 7 -
official form shall conform to the substance of such form." Sec.
1.152-4T(a), Q&A-3, Temporary Income Tax Regs., 49 Fed. Reg.
34459 (Aug. 31, 1984).3 Internal Revenue Service Form 8332,
Release of Claim to Exemption for Child of Divorced or Separated
Parents, is the IRS form intended to satisfy sec. 152(e)(2)(A),
and this form provides for the (1) name of the children for which
exemption claims were released, (2) years for which the claims
were released, (3) signature of the custodial parent, (4) Social
Security number of the custodial parent, (5) date of signature,
and (6) name and Social Security number of the parent claiming
the exemption.
Petitioner did not attach IRS Form 8332 to his returns for
any of the years in question, nor did he attach any other written
statement, signed by his former spouse, which would, in
substance, comply with the requirements of section 152(e)(2)(A)
and the temporary regulations thereunder. Petitioner, therefore,
has not established entitlement to a dependency exemption for his
daughter for the years in question. Respondent is sustained on
this issue.
3
The Court notes that temporary regulations have binding
effect and are entitled to the same weight as final regulations.
Peterson Marital Trust v. Commissioner, 102 T.C. 790, 797 (1994),
affd. 78 F.3d 795 (2d Cir. 1996); Truck & Equip. Corp. v.
Commissioner, 98 T.C. 141, 149 (1992); see LeCroy Research Sys.
Corp. v. Commissioner, 751 F.2d 123, 127 (2d Cir. 1984), revg. on
other grounds T.C. Memo. 1984-145.
- 8 -
At trial, petitioner expressed some degree of exasperation
over the fact that the State court judgment expressly allowed him
the dependency exemption "but they didn't tell me that back then
that I had to have a letter of hers saying I could have [the
exemption]". The court judgment, however, quoted above,
expressly provides that petitioner's former spouse was required
to execute IRS Form 8332 or any other form required by Federal
and State internal revenue laws. The record is silent as to
whether petitioner ever requested his former spouse to execute
the necessary release. Petitioner further complained "Why
doesn't the court system work together here? I mean, why does
the Anoka County court system give me this right, and then the
Federal court says, no, I can't do this. The IRS says I can't do
this." The answer to that concern is very simple: petitioner
did not obtain from his former spouse and attach to his return
the required release; i.e., IRS Form 8332 or any acceptable
written statement. The Court explained to petitioner that, if
his former wife refused to comply with the requirements of the
divorce decree, his recourse was to seek relief against her in
the State court that issued the decree. The bottom line is that
the court systems do work, but it is up to the aggrieved party to
seek relief from the appropriate court where the rights of such
party have not been honored.
- 9 -
Decision will be entered
for respondent.