T.C. Summary Opinion 2001-145
UNITED STATES TAX COURT
JOHN R. JOHNSON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 8535-00S. Filed September 18, 2001.
John R. Johnson, pro se.
Carina J. Campobasso, for respondent.
POWELL, Special Trial Judge: This case was heard pursuant
to the provisions of section 7463 of the Internal Revenue Code in
effect at the time the petition was filed.1 The decision to be
entered is not reviewable by any other court, and this opinion
should not be cited as authority.
1
Unless otherwise indicated, subsequent section references
are to the Internal Revenue Code in effect for the years in
issue, and Rule references are to the Tax Court Rules of Practice
and Procedure.
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Respondent determined deficiencies of $742 and $3,068 in
petitioner’s 1997 and 1998 Federal income taxes, respectively.
The issue is whether petitioner is entitled to dependency
exemption deductions for any of his children during 1997 and
1998. Petitioner resided in Milford, Maine, at the time he filed
the petition in this case.
Petitioner and his former wife were divorced in 1990. From
what is in the record, in the earlier years the divorce was not a
pleasant affair. Petitioner had three children from this
marriage (Tracey, Meghan, and Candace). The original divorce
decree, dated September 21, 1990, provides:
The Court awards to the parties shared parental rights
and responsibilities as to the minor children * * *. The
primary physical residence of the children shall be with the
* * * [former wife]. * * * [Petitioner] shall have the
right to be visited by the minor children at all reasonable
times * * *.
The divorce decree was amended on January 7, 1992, to provide
that
“reasonable times” * * * shall be defined to include at
least that period during the three consecutive days off
* * * that * * * [petitioner] has in his current employment
schedule * * *.
It is not disputed that petitioner paid more than half of
the support for the children during the years before the Court.
The original divorce decree provided that petitioner would pay
$148.72 per week for child support. On January 28, 1993, by
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court order, that amount was reduced to $100 per week because
Candace was living at petitioner’s residence.
According to petitioner and his former wife, the children’s
primary residence over the years in issue was fluid. One child
would get angry with one parent and move in with the other
parent. This was done apparently without specific authorization
by the court; it is clear from the court’s January 28, 1993,
order, however, that the court was aware of and approved of the
relatively fluid state of affairs.
For the taxable years 1997 and 1998, petitioner filed his
returns as a head of household and claimed dependency exemption
deductions for all three children. On examination for the 1997
return, respondent disallowed one dependency exemption deduction.
With respect to the 1998 return, respondent disallowed all three
of the claimed dependency exemption deductions.
Section 151(c) allows a taxpayer to deduct an exemption
amount for each dependent as defined in section 152. Section
152(a)(1), inter alia, defines a dependent as a daughter “over
half of whose support * * * was received from the taxpayer (or is
treated under subsection * * * (e) as received from the
taxpayer)”. In relevant part, subsection (e) provides that in
the case of divorced parents “the parent having custody for a
greater portion of the calendar year” is treated as having
supplied over half of the support. Sec. 152(e)(1).
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Section 1.152-4(b), Income Tax Regs., provides that custody
will be determined by the terms of the most recent decree of
divorce * * *. * * * [I]f * * * a decree * * * [does not
establish] who has custody, * * * “custody” will be deemed
to be with the parent who, as between both parents, has the
physical custody of the child for the greater portion of the
calendar year.
While section 152(e)(2) provides that a custodial parent under
section 152(e)(1) may agree that the noncustodial parent may
claim a dependency exemption, the requirements of that exception
are not satisfied here.
Respondent focuses on the original divorce decree that
provided that the primary physical residence for the children
would be with the former wife. But, as far as this record is
concerned, that decree was not the most recent court action with
respect to the custody issue as it related to all the children.
In January 1993, the court recognized that one of the children
(Candace) was living with petitioner and approved that
arrangement.
We realize that there may have been other custodial
arrangements during the years that would render the January 1993,
court order stale, but, by the same token, such arrangements
would also render the original divorce decree stale. On the
other hand, if we conclude that the decree does not establish
which parent had custody, it seems quite apparent from the
testimonies of petitioner and his former wife that petitioner had
physical custody of one of the children for the greater portion
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of each year in issue. The record, however, does not support a
finding that petitioner had custody of all three children for the
greater portion of both years.
With this in mind, we turn to the 1997 year. Respondent
only disallowed one of the three claimed dependency exemption
deductions. We sustain respondent’s determination. With regard
to the 1998 year, petitioner again claimed three dependency
exemption deductions that respondent disallowed in full. We find
that petitioner has established that he is entitled to one
dependency exemption deduction for 1998.
Reviewed and adopted as the report of the Small Tax Case
Division.
Decision will be entered
under Rule 155.