T .C. Su m m ary Op i n io n 2 01 8 -2 9

UNITED STATES TAX COURT

J OSEPH ENGESSER, Pet i t i o n er v . COM M ISSIONER OF INTERNAL REVENUE, Res po n d en t

Do ck etNo . 1 2 2 83 -1 6 S. Fi l edJ u n e 4 , 2 0 1 8
.
Ho wardCh ern o ff, fo r p et i t i o n er. Byro n M . Hu an g , fo r res p o n d en t .

SUM M ARY OPINION COLVIN, J u dg e: Th i s cas e was h eard p u rs u an tt o th e p ro v i s i o n s o f s ect i o n 7 4 63 o f the In t ern al Rev en u e Co de i n effect wh en th e p et i ti o n was- 2
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fi led
. 1 Pu rs u an tt o s ect i o n 7 4 6 3(b ), th e d eci s i o n t o b e en t eredi s n o trev iewab l e b y an y o th er co u rt , an dth i s o p i n i o n s h al l n o tb e t reat edas p reced en t fo r an y o th er cas e. Res p o n d en td et erm i n eda d efi ci en cy o f $ 3 ,7 2 9 i n p et i t i o n er’ s Fed eral i n co m e t ax fo r 2 0 1 4. Th e i s s u es fo r d eci s i o n are wh et h er, fo r 2 01 4 , p et i t i on er m ay cl ai m as a d ep en d en th i s m i n o r ch i l dH.E. 2 an dwh ether h e i s en t i t l edt o a ch i l dt ax cred i t , an earn edi n co m e t ax cred i t , an dh eado f h o u s eh o l dfi l i n g s t atu s wi th
res p ectt o H.E. Res p o n den tco n ced es th atp et i t i o n er wi ll p rev ai l o n th es e i s s u es i f H.E. h adth e s am e p ri n ci p al p l ace o f ab o de as p et i t i o n er fo r m o re t h an o ne-h al f o f 2 0 1 4 . W e h o l d t h ats h e d id
. Back gro u n d So m e o f t h e fact s h av e b een s ti p u lat ed an dare s o fo u n d. Pet it i o n er res i d ed i n New J ers ey

wh en h e fi l edth e p et i t io n .

1 Un l es s o th erwi s e i nd i cat ed , s ect io n referen ces are t o t h e In t ern al Rev en u e Co d e, as am en d edan di n effect fo r t h e y ear at i s s u e, an dRu l e referen ces are t o th e Tax Co u rtRu l es o f Pract i ce an dPro cedu re. M on et ary am o u n ts are ro u n d edt o th e n eares td o l l ar.

2 W e refer t o m i n o r ch il drenb y th ei r i n i t ial s . See Ru le 2 7 (a)(3 ).- 3
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1
. 2 0 0 6 -1 3 Pet i t i o ner an d Ceri ce An th o n y l iv edt o g et h er fro m

2 0 0 6 u n t i l l at e i n 2 0 1 3 o r earl y i n 2 0 1 4 i n wh atwe wi l l refer t o as ap art m en tE. 3 Pet i t i o n er an d M s. An th o n y are t h e p aren t s o f H.E., a m i no r ch i l db o rn i n 2 00 6
. Pet i t i o ner an d M s . An th o n y
n ev er m arri ed
. 2
. 2 0 1 4 Pet i t i o ner co n ti n u ed t o l i v e i n ap art m en tE du ri n g 2 0 14 , th e y ear at i s s u e. Aro un dth e b eg i n n in g o f 2 0 1 4 M s . An th o ny m o v edfro m

ap art m en t E t o h er
m o th er’ s n earb y

ap art m en t , wh i ch we wi l l refer t o as ap art m en tS. M s . An th o n y was rem o v edfro m

th e l eas e fo r ap art m en t E o n Au g us t8 , 2 0 14
. Du ri n g 2 0 1 3 -1 4 p et i t i on er wo rk edat Lo we’ s an das a cu s t o d i an at M i d d l es ex Co u n ty

Co l l eg e. Hi s wo rks ch edu l e at M i d dl es ex Co u n ty Co l l eg e was fro m 3 : 3 0 p .m . t o 1 1 : 3 0 p .m . Ons ch o o l d ay s wh en p et i t i o n er wo rk edth o s e h o u rs , p et i t i o n er’ s p aren ts t o o kcare o f H.E. aft er s ch oo l an du n ti l p et i t io n er fi n is h ed
wo rk . Pet i t i on er s t op p ed wo rk i n g atM i d dl es ex Co u n ty Co l l eg e ata t i m e n o t
s p eci fi edi n the reco rd
.

3 Th e s treet ad dres s an dci ty n am e are n o tn eed edfo r p u rp os es o f d eci d i n g th e fact u al i s su e i n d i s pu t e.- 4
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A l et t er d at edOct o ber 1 4 , 2 0 1 5 , fro m M es s i n a Ped i atri cs s t at es th atH.E.
was s een i n thato ffi ce o n No v em b er 1 0 , 2 0 1 4 , Decem

b er 5 , 2 0 1 4 , an dM arch 2 5 , 2 0 1 5 , an dth atacco rd i n g t o the reco rd s o f t h ato ffi ce, H.E. res i d edatap art m en t E. A U.S. Po s tal Serv i ce (USPS) ch an ge o f ad dres s fo rm d at ed Decem

b er 4 , 2 0 1 4 , p u rp o rt s t o ch an g e H.E.’ s ad dres s fro m ap art m en t S t o ap art m en tE. Pet i t io n er d i dn o tp rep are t h e ch an g e o f ad dres s fo rm , an dth e reco rdd oes n o t
s h o w wh o p rep aredi tan ds ub m i t t edi tt o th e USPS. 3
. Pet i t i o ner’ s an dM s . An th o n y ’ s Tax Retu rn s fo r 2 0 1 4 Pet i t i o ner t i m el y

fi l eda Fo rm

1 0 4 0 , U.S. In d i v i du al In co m e Tax Retu rn , fo r 2 0 1 4 . Onth atretu rnp et i t i o n er cl ai m edH.E. as a d ep en d en t , an d h e cl ai m edh ead
o f h o us eh o l dfi l in g s t atus , a ch i l dt ax cred i t , an dan earn edi n co m e t ax cred i twi t h
res p ectt o H.E. Pet i t i o n er d i dn o ts ub m i ta Fo rm 8 3 32 , Rel eas e/ Rev o cat i o n o f Rel eas e o f Cl ai m

t o Ex em p t i o n fo r Ch il db y

Cu st od i al Paren t , wi th h i s Fo rm 1 04 0 fo r t ax y ear 2 0 1 4
. M s . An th o ny

al so cl ai m edH.E. as a d ep en d en to n h er Fo rm 1 0 4 0 fo r t ax y ear 2 0 1 4 . Th ere i s n o ev i d en ce t h atM s . An th on y s ubm i t t eda Fo rm

8 3 32 wi th h er 2 0 14 retu rn .- 5
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4
. 2 0 1 5 an d 2 0 16 A l et t er fro m

Ol dBri d ge To wn s h i p Publ i c Sch o o l s d at edAu g u s t2 6 , 2 0 1 5 , s t at es th atH.E. l i v edatap art m en tE, p res u m ab l y m ean i ng i n Au g u s t2 0 1 5
. Pet i t i o ner i n i t i at eda cu s t o dy p ro ceed i n g i n 2 0 1 5 i n th e Sup eri or Co u rto f New J ers ey . OnOct ob er 2 8 , 2 0 1 5 , th e s uperi o r co u rto rd eredjo i n tcu s t o dy o v er H.E. fo r p et i t i o n er an dM s . An th o n y . Un d er t h i s s ch edu l e each p aren th ad cu s t o dy o v er H.E. ab o u to n e-h al f o f t h e t i m e. Th e Oct o b er 2 8, 2 0 1 5 , o rd er al s o s ai dth at M s . An th o ny

co ul dcl ai m

H.E. as a d ep en d en tfo r 2 0 1 5 an dal l o d d -n um b ered y ears an dp et i t i o n er co u l dcl ai m h er as a d ep en d en t fo r 2 0 1 6 an dal l ev en n u m b eredy ears . OnSep t em

b er 2 0 , 2 0 1 6 , th e s uperi o r co u rtrev i sedth e cu s t o dy s ch edu l e, redu ci n g th e t i m e H.E. wo u l db e wi th p et i t i o n er. Di s cu ss i o n Th e i s s u es fo r d eci si o n are wh et h er, fo r 2 0 1 4 , p et i ti o ner i s en t i t l edt o cl ai m H.E. as a d ep en d en t an d wh et her h e i s en ti t ledt o a ch i l d t ax cred i t , an earn ed i n co m e t ax cred i t , an d h eado f h o u s eh o l dfi l in g s t atu s wi th res p ectt o H.E. 1
. Ap p li cab l e Tax Ru l es A t ax p ay er i s al l o weda d edu ct i o n fo r “ each i n di v i du al wh o i s a d ep en d en t (as d efi n edi n sect i o n 1 5 2 ) o f t h e t ax p ay er fo r t h e t ax ab le y ear.” Sec. 1 5 1 (a), (c). Sect i o n 1 5 2 (a) d efi nes th e t erm “ d ep en d en t” t o i n cl u d e a “ qual i fy in g ch i l d ” o r a- 6
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“ qu al i fy i n g rel at i v e”. Gen eral l y , a “ qu al i fy i n g ch il d ” m u s t(1 ) b ear a s p eci fi ed rel at i o n s h i p t o th e t ax p ay er (e.g ., b e t h e t ax p ay er’ s ch il d ), (2 ) h av e t h e s am e p ri n ci p al p l ace o f ab o d e as th e t ax pay er fo r m o re t h an o n e-h al f o f t h e t ax ab l e y ear, (3 ) m eetcert ai n ag e req u i rem en t s , (4 ) n o th av e p ro v i d edo v er o n e-h al f o f s u ch i n d i v i du al ’ s o wns up p ort fo r t h e rel ev an t p eri o d , an d(5 ) n o t h av e fi leda jo i n t retu rn fo r t haty ear. Sec. 1 5 2 (c)(1 ). Res p o n d en tco n ced es thatH.E. s at i s fi es th e ag e, rel at i o n s h i p , an ds upp o rtreq ui rem en t s o f s ect i on 1 5 2 (c). Th e p art i es d i s p u t e o n l y wh et h er H.E. l i vedwi th p et i t i o n er fo r m o re t h an o n e-h al f o f 2 0 1 4
. Sect io n 2 4 (a) p ro v i des a t ax cred i twi th res p ectt o each qu al i fy i n g ch i l do f th e t ax p ay er fo r wh o m

th e t ax p ay er i s al l o weda d edu ct i o n u n d er s ect i o n 1 5 1
. Th e t erm “ qu al i fy i n g ch il d ” i s d efi n ed as a “ qual i fy i n g ch i l d o f t h e t ax p ay er (as d efi n edi n s ect i o n 1 5 2 (c)) wh o h as n o tat t ai nedag e 1 7.” Sec. 2 4 (c)(1 ). Sect io n 3 2 (a)(1 ) al l o ws an el i g i b l e i n d iv i du al an earn edi nco m e t ax cred i t . Sect i o n 3 2 (c)(1 )(A)(i ) d efi nes an “ el i g ib l e i n d i v i du al ” as an i n di v idu al wh o h as a qu al i fy in g ch i l dfo r t he t ax ab l e y ear. Th e t erm “ qu al i fy i n g ch i ld ” m ean s a

“ qu al i fy i n g ch i l d o f t h e t ax pay er (as d efi n ed i n s ect i o n 1 5 2 (c), d et erm i n edwi th o u t reg ardt o p arag rap h (1 )(D) t h ereo f an ds ect i on 1 5 2 (e)).” Sec. 3 2 (c)(3 )(A). Sect io n 1 (b ) p res cri b es a rel at i v el y fav orab l e t ax s ch edul e fo r a t ax p ay er wh o qu al i fi es as a “ h eado f h o u s eh o l d ”. A h eado f h o u s eh o l d , as rel ev an t h erei n ,- 7
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i s an i n d i v i du al t ax p ay er wh o : (1 ) i s u n m arri edas o f t he cl os e o f t h e t ax ab l e y ear an d i s n ota s u rv i v i ng s p o u s e; an d(2 ) m ai n t ai n s as h i s h o m e a h o u s eh o l dth at
co n st i tu t es fo r m o re t h an o ne-h al f o f t h e t ax ab l e y ear t he p ri n ci p al p l ace o f ab o d e, as a m em b er o f s uch h o us eh o l d , o f (a) “ a qu al i fy i n g ch i l do f t h e i n di v i du al (as d efi n edi n s ect i o n 1 5 2 (c), d et erm i n edwi th o utreg ardt o s ect i on 1 5 2 (e))”, o r (b )

“ an y o ther p ers o n wh o i s a d ep en d en to f th e t ax pay er, i f t h e t ax p ay er i s en ti t l edt o a d educt io n fo r t h e t ax ab l e y ear fo r s u ch p ers o n u n d er s ect i o n 1 5 1 ”. Sec. 2 (b ). Res p o n d en tco n ced es th atp et i t i o ner i s en t i tl edt o p rev ai l o n al l o f th es e i s su es i f H.E. h adth e s am e p ri n ci p al p l ace o f ab o d e as p et i t i o n er fo r m o re t h an o n e-h al f o f 2 0 1 4
. 2
. Wh et h er H.E. Hadth e Sam e Pri n ci p al Pl ace o f Ab o d e as Pet i t i o n er fo r M o re Th an On e-Hal f o f 2 0 1 4 Res p o n d en tp o i n t s o u tth at(1 ) t h e l et t er fro m M es s in a Ped i at ri cs d o es n o t
s ay wh ere H.E. l i vedduri ng m o s to f 2 0 1 4 ; (2 ) t h e 2 0 15 an d 2 0 1 6 cu st o dy o rd ers d o n o t g i v e p et i t i on er cu s t o dy o v er H.E. fo r m o re th an o n e-h al f o f t h e t i m e aft er Oct o b er 2 8 , 2 0 1 5 ; (3 ) t h e USPS ch an g e o f ad dres s fo rm o f u n kn o wnau th o rs h i p s ay s H.E.’ s ad dres s ch an g edfro m ap art m en tS t o ap art m en tE i n Decem b er 2 0 1 4 ; (4 ) p et i t i o n er d i d n o t i n cl ud e a Fo rm 8 3 32 wi th h i s Fo rm

1 0 40 fo r 2 0 1 4 ; an d (5 ) t h ere were an o m al i es i n p et i t i o n er’ s t es t i m o n y .- 8
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3
. Pet i t i o ner’ s Tes t i m o n y Th i s cas e wi l l b e d eci d edi n p arto n th e b as i s o f o u r as s es s m en t o f t h e cred i b i l i ty

o f p et i t i on er’ s t es t i m o n y th atH.E. h adth e s am e p ri nci p al p l ace o f ab o de as p et i t i o ner fo r m o re t h an o ne-h al f o f 2 01 4
. W e d eci d e wh et h er a wi tn es s ’ t es t i m o ny i s cred i bl e b y

rel y in g o n o bject i ve fact s , th e reas o n ab l en es s o f t h e t es t i m o ny , th e co n s is t en cy of s t at em en t s m ad e b y th e wi tn es s , an dth e d em ean o r o f th e wi tn es s . See Qu o ckTi ng v . Un i t edSt at es , 1 4 0 U.S. 4 1 7 , 4 2 0 -4 2 1 (1 8 9 1 ); W o o dv . Co m

m i s si o ner, 3 3 8 F.2 d6 0 2 , 6 0 5 (9 th Ci r. 1 9 6 4), aff’ g 4 1 T.C. 5 9 3 (1 9 6 4); Pi n d er v . Un i t edSt at es , 3 3 0 F.2 d1 1 9 , 1 2 4-1 2 5 (5 th Ci r. 1 9 64 ); Co n co rd Co n s u m ers Ho u s. Co o p. v . Co m m i s s i o n er, 8 9 T.C. 1 0 5 , 1 2 4 n .2 1 (1 98 7 ). W e m ay d i s co u n t t es t i m on y

wh i ch we fi n dt o b e u n wo rt h y o f b el i ef, s ee To k ars ki v . Co m m i s s i o n er, 8 7 T.C. 7 4, 7 7 (1 9 8 6 ), b utwe m ay n o tarb i trari l y d i s reg ard t es t i m o ny th ati s co m

p et en t, rel ev an t , an du n co n trad i ct ed , s ee Co n t i v
. Co m m i s s i o n er, 3 9 F.3 d6 5 8 , 6 6 4 (6 th Ci r. 1 99 4 ), aff’ g an drem an d i n g 9 9 T.C. 3 7 0 (1 9 9 2), an dT.C. M em o . 1 9 9 2-6 1 6
. Pet i t i o ner t es t i fi edth atH.E. res i d edwi th h i m i n ap art m en tE th ro u gh o u t 2 0 1 4 . Pet i t i o n er al s o t es t i fi ed th atM s . An th o n y s o m et i m es as kedwh et h er s h e co u ldt ak e H.E. fo r a p eri o d , s u ch as o n e o r t wo d ay s , an dth ath e al way s ag reedt o th o s e req u es t s . Res p o n d en tp o i n t s o u t thats ay i ng H.E. l i v edwi th h im du ri n g “ al l ”- 9
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o f 2 0 14 i s i n co n s i s t en twi th p et i t i o n er’ s t es ti m o n y th atH.E. s om et i m es s p en ts om e d ay s wi th M s . An tho ny , b u twe d o n o tb el i ev e t h o s e t wo s t at em en t s u nd erm i n e p et i t i o n er’ s co nt en t i o n th at H.E. h adth e s am e p ri n ci p al p l ace o f ab o d e as p et i t i o n er fo r m o re t h an o n e-h al f o f 2 01 4
. 4
. Do cu m en t ary

Ev i d en ce Th e l et t er fro m

M es s i n a Ped i atri cs s h o ws th atH.E. l i v edwi th p et i t i o n er du ri n g No v em

b er an dDecem

b er 2 0 1 4
. Th e l et ter fro m H.E.’ s s ch o o l s h o ws th at H.E. l i v edwi th p et it i o n er i n Au g u s t2 0 1 5
. W e d o n o tco n s i der t h e Decem b er 4 , 2 0 1 4 , USPS ch an g e o f ad dres s fo rm b ecau s e t h e reco rdd o es n o ts h o w wh o p ro v id edth ati n fo rm at i on . Res p o n d en ti n fers fro m

th e 2 0 1 5 an d2 0 1 6 jo in t cu s t o dy o rd ers , wh i ch
res u l ted fro m

a cu s t o dy

s u i tb ro u g h tb y

p et it i on er, t hatH.E. d i dn o th av e t h e s am e p ri n ci p al p l ace o f ab o d e as p et it i o n er fo r m o re t h an o n e-h al f o f 2 01 4 an dth at p et i t i o n er b ro u g h tth e cu s t od y cas e i n o rd er t o ex p an dth e ex t en to f h i s cu s t o dy fo r H.E. Ho w ev er, p et i t i o n er t es t i fi ed , i n effect , th ath e i n i t iat ed th ats u i tb ecau s e h e wan ted a m o re fo rm al i zedcu s t o dy arran g em en t . Pet i t i o ner’ s acco un ti s cred i b l e o n th e b as i s o f t h i s reco rd
. Res p o n d en tp o i n t s o u tth atM s. An th o n y cl ai m edH.E. as a d ep en d en tan d d i dn o t p ro v i d e a Fo rm

8 3 3 2 t o p et i t i o n er wai v i n g h er ri g h tt o d o s o , b u tth i s- 1 0 -

s eem s n o m o re n o t ewo rt h y i n es t ab li s h i n g H.E.’ s res i d en ce t han th e fact th at p et i t i o n er al s o cl ai m edh er as a d ep en d en tan d , ap p aren t l y , d i d n o tp ro v i d e a Fo rm 8 3 3 2 t o M s. An th o n y . Th e g ap s i n th e d ocu m en t ary ev i d en ce fo r 2 0 1 4 , th e d ocu m en t ary ev i d en ce fo r 2 0 1 5 -1 6 , an dth e an o m al i es i n p et i t i o n er’ s t es t i m o n y d o n o tu n derm in e p et i t i o n er’ s o v eral l t es t i m o n y . 5
. Co n cl u si o n Onth i s reco rd , we fi n dth atH.E. h adth e s am e p ri n ci pal p l ace o f ab o d e as p et i t i o n er fo r m o re t h an o n e-h al f o f 2 01 4 . Thu s , H.E. was p et i ti o n er’ s qu al i fy i n g ch i l das d efi n edi n s ect i o n 1 5 2 (c) fo r 2 0 1 4 , an d , i n th e l i g h to f res p o n d en t ’ s co n ces si o n s , p et it i o n er i s en t i t l edt o th e d ep en d en cy ex em p t i o n , th e ch i l d t ax cred i t , th e earn edi n co m e t ax cred i t , an dh eado f h o u seh o l d fi l i n g s t atu s wi th
res p ectt o H.E. fo r 2 0 1 4
. To refl ectthe fo reg o i n g , Deci s i o n wi ll b e en t ered fo r p et i ti o n er.