T.C. Summary Opinion 2002-41
UNITED STATES TAX COURT
JENNIFER ANN ROGERS, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
WILLIAM R. LAUTENBERGER, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket Nos. 3890-01S, 5511-01S. Filed April 18, 2002.
Jennifer Ann Rogers, pro se in docket No. 3890-01S.
William R. Lautenberger, pro se in docket No. 5511-01S.
Andrew R. Moore, for respondent.
WOLFE, Special Trial Judge: These consolidated cases were
heard pursuant to the provisions of section 7463 of the Internal
Revenue Code in effect at the time the petitions were filed. The
decisions to be entered are not reviewable by any other court,
and this opinion should not be cited as authority. Unless
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otherwise indicated, subsequent section references are to the
Internal Revenue Code in effect for the year in issue, and all
Rule references are to the Tax Court Rules of Practice and
Procedure.
Respondent determined deficiencies in petitioners’ 1998
Federal income taxes as follows:
Docket No. Amount
3890-01S $4,504
5511-01S $3,430
After concessions by respondent,1 the issues for decision are
whether either petitioner is entitled to: (1) A dependency
exemption deduction for petitioners’ daughter, Diana M.
Lautenberger, and (2) a child tax credit for that daughter.
Some of the facts have been stipulated and are so found.
When the petitions were filed in these cases, petitioner Jennifer
Ann Rogers (Ms. Rogers) resided in San Francisco, California, and
petitioner William R. Lautenberger (Mr. Lautenberger) resided in
Pacifica, California.
1
With respect to docket No. 3890-01S, respondent concedes
that for taxable year 1998 Ms. Rogers is entitled to: (1) Head
of household filing status; (2) a dependency exemption deduction
for her daughter, Morgan C. Campbell; (3) a child care credit of
$370 with respect to Morgan C. Campbell; and (4) a child tax
credit for Morgan C. Campbell.
With respect to docket No. 5511-01S, respondent concedes
that for taxable year 1998 Mr. Lautenberger is entitled to: (1)
Head of household filing status; (2) a dependency exemption
deduction for his son, Alexander P. Lautenberger; and (3) a child
tax credit for Alexander P. Lautenberger.
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Background
Petitioners formerly were married but were divorced in 1993.
They are the parents of Diana M. Lautenberger (Diana) and other
children. Petitioners have been subject to various custody
orders concerning their children. The custody order in effect
during 1998 provided for joint custody of Diana with physical
custody split equally between petitioners on a weekly basis.
With occasional exceptions, during 1998 Diana spent alternate
weeks with each of her parents.
On their 1998 Federal income tax returns, both petitioners
claimed Diana as a dependent and both claimed a child tax credit
with respect to her. Respondent determined deficiencies in both
petitioners’ 1998 Federal income taxes. At the request of
respondent, the cases have been consolidated to assure that our
decisions are consistent.
Discussion
Section 151(c) allows an individual taxpayer to deduct an
exemption amount for each dependent as defined in section 152 in
computing taxable income. Under section 152(a), the term
“dependent” means certain individuals, including a son or
daughter of the taxpayer, over half of whose support was received
from the taxpayer (or is treated under subsection (c) or (e),
concerning multiple support or divorce situations, as received
from the taxpayer) during the calendar year in which the taxable
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year of the taxpayer begins.
Generally, if a child’s parents are divorced, the child is
in the custody of one or both for the year, and the parents
provide over half of the child’s support, the custodial parent
(the parent with custody for the greater portion of the year) is
treated as having provided over half of the child’s support for
the year, and he or she may deduct the exemption amount with
respect to such child for the year. Sec. 152(e)(1). The
applicable regulations provide that “In the event of so-called
‘split’ 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.” Sec.
1.152-4(b), Income Tax Regs.
Under section 24(a), a taxpayer is allowed a $400 credit for
each qualifying child. For purposes of section 24, a taxpayer’s
child is a qualifying child only if the taxpayer is allowed a
dependency exemption deduction for the child under section 151.
Sec. 24(c)(1). Here, if either petitioner is entitled to a
dependency exemption deduction for Diana, that petitioner is also
entitled to a child tax credit with respect to her.
Mr. Lautenberger argues that during 1998 he had physical
custody of Diana for 187 days, while Ms. Rogers had physical
custody of Diana for only 178 days. Mr. Lautenberger argues that
the difference in the number of days is attributable to a
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vacation that he took with Diana during July of 1998. The
vacation occurred during a period of time that Diana otherwise
would have spent with Ms. Rogers. In Mr. Lautenberger’s words,
“Jennifer and I * * * each had custody an equal amount of time,
other than that week, which put Diana in my custody more than 50
percent, more than 183 days of the year.” Mr. Lautenberger
submitted into evidence a chart he created listing the days that
Diana spent with him and the days that Diana spent with Ms.
Rogers during 1998. He also submitted two diaries that he
allegedly maintained contemporaneously that included notations
about the number of children that lived with him during any given
week.
The evidence submitted by Mr. Lautenberger in support of his
claim is unconvincing and generally is self-serving and not
credible. The chart showing which days of 1998 Diana spent with
each petitioner was compiled by Mr. Lautenberger one day before
trial (Feb. 5, 2002). The chart, therefore, is nothing more than
a summary of his contentions. Mr. Lautenberger’s diaries fail to
show that Diana spent a greater portion of the year with him than
with Ms. Rogers. The diaries contain a “0”, “2”, or “4” on the
first page for each week, purportedly indicating how many
children lived with Mr. Lautenberger during that week. The
diaries do not indicate which of the children the numbers refer
to, nor do they indicate which of the children or how many
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children lived with Mr. Lautenberger on any particular day of the
week. It is also not clear whether the numerical notations were
contemporaneously made. The vast majority of the entries in the
diaries were written in ink, but the numerical notations
indicating how many children lived with Mr. Lautenberger each
week were written in pencil. Mr. Lautenberger admitted that he
had no independent memory of where Diana was during each day of
1998. He also explained that the notations in his diary
regularly were used as a planning tool so that he could mark in
advance the children that probably would be with him for a month
and schedule his time accordingly.
Ms. Rogers does not dispute that Diana went on a vacation
with Mr. Lautenberger during a week that Diana otherwise would
have spent with her. She argues, however, that it is simply
impossible to ascertain which of the two of them had physical
custody of Diana for the greater portion of the year.
Although Diana regularly alternated between petitioners on a
weekly basis during 1998, the parties did not rigidly enforce
compliance with the custody order. Mr. Lautenberger testified
that “We have an agreement for a week on and a week off, so we
can say that most weeks generally are going back and forth.” Ms.
Rogers testified that Diana generally spent one week at a time
with each petitioner, but that exceptions were made. Ms. Rogers
stated:
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William and I share custody exactly 50/50. * * *
However, I don’t think that there’s any way that anyone
can document the amount of time that each child was in
the house.
It’s not the intention of shared custody to try to
finagle a tax exemption out of it, or else we would be
marking every single minute that the child was in one
house or the other.
Diana goes to school in San Francisco, and I live
in San Francisco, so she often stops by at other times
in my house. I’ve picked her up when she’s sick, and
of course I’m going to let her go on vacation with her
father, because that’s to her benefit to have a
vacation with her father, and as I mentioned, * * * he
documented what he believes was his calendar, but he
has no way of documenting my calendar or of knowing
Diana’s whereabouts at every minute when she’s 14 years
old.
So it completely defeats the purpose of a shared
custody. It’s for Diana’s benefit. It’s not to try
and manipulate it in order to get a tax exemption, and
I think it’s ridiculous for him to even introduce that
idea.
Ms. Rogers further stated “My position is that * * * she was with
us equally”.
Ms. Rogers’ testimony was delivered in a convincing manner,
obviously without regard to tax consequences, and we believe her
testimony. Mr. Lautenberger’s testimony was not delivered in a
convincing manner, and his documentary evidence is not
convincing.
These consolidated cases cried out for some reasonable
settlement between petitioners, particularly since respondent is
merely a disinterested stakeholder concerned only that the
dependency exemption and the child tax credit not be taken twice
for the same child. Petitioners did not take that route despite
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many suggestions that they do so. They insisted on decision by
the Court on this record.
On the record presented to the Court, it would be sheer
unguided guesswork for the Court to find that Diana spent more
than half of 1998 with either petitioner. One petitioner, Ms.
Rogers, has testified convincingly that Diana spent half her time
with each petitioner. On this record we agree with Ms. Rogers
and conclude that during 1998 Diana did not spend more than half
her time with either parent but spent half her time with each.
Consequently we hold that neither petitioner is entitled to a
deduction for the exemption amount with respect to Diana for
1998, and neither petitioner is entitled to a child tax credit
with respect to Diana for 1998.
Reviewed and adopted as the report of the Small Tax Case
Division.
Decisions will be entered
under Rule 155.