1 All subsequent section references are to the Internal

Revenue Code in effect for 1998, the taxable year in issue.

T.C. Summary Opinion 2002-67

UNITED STATES TAX COURT

WAYLON D. ARY, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 6466-01S. Filed June 10, 2002.

Waylon D. Ary, pro se.

J. Anthony Hoefer, for respondent.

ARMEN, Special Trial Judge: This case was heard pursuant to 

the provisions of section 7463 of the Internal Revenue Code in

effect at the time that the petition was filed.1 The decision to

be entered in this case is not reviewable by any other court, and

this opinion should not be cited as authority. 

Respondent determined a deficiency in petitioner’s Federal
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income tax for the taxable year 1998 in the amount of $1,610.

The issues for decision by the Court are as follows:

(1) Whether petitioner is entitled to deductions for

dependency exemptions for his two youngest sons. We hold that he

is not.

(2) Whether petitioner is entitled to a child tax credit in

respect of his two youngest sons. We hold that he is not.

Background

Most of the facts have been stipulated, and they are so

found. Petitioner resided in Dysart, Iowa, at the time that his

petition was filed with the Court.

Petitioner and Sarah Jill Ary (Ms. Ary) were married in

August 1989. The couple had three children, all boys. The

youngest two, Corey Matthew and Danan Lee, were born in August

1990 and September 1995, respectively.

By the mid-1990s, petitioner and Ms. Ary began to experience

marital difficulties. The couple separated in 1996, and divorce

proceedings were commenced by Ms. Ary.

In May 1997, the District Court for Benton County, Iowa (the

Iowa State court) issued a decree dissolving the marriage between

petitioner and Ms. Ary. The decree included the following

provisions dealing with support and custody: 
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(1) Insofar as spousal support was concerned, the Iowa State

court did not award alimony to either party, apparently because

both parties were employed and earning approximately the same

hourly wage. 

(2) Insofar as custody was concerned, the Iowa State court

granted the parties joint legal custody of their three minor

children; however, the Iowa State court awarded Ms. Ary primary

physical custody of the children, subject to reasonable and

liberal visitation rights by petitioner. 

(3) Insofar as child support was concerned, the Iowa State

court ordered petitioner to pay a total of $648.38 per month for

the support of the parties’ three children.

Finally, the Iowa State court’s decree included the

following provision dealing with tax deductions for dependency

exemptions:

Tax Dependency: For the purpose of income tax, if

[petitioner] is current on his support obligation under

this Decree as of December 31 of any year beginning

with the 1997 tax year, [petitioner] is entitled to

claim the two youngest children as dependents for

income tax purposes * * * .

For 1998, the taxable year in issue, Ms. Ary had physical

custody of Corey and Danan for more than half of the year.

For 1998, petitioner timely paid his child support

obligation through payroll withholding by his employer for each

of the months of that year.
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2 We decide the issues in this case without regard to the

burden of proof. Accordingly, we need not decide whether the

general rule of sec. 7491(a)(1) is applicable in this case. See

Higbee v. Commissioner, 116 T.C. 438 (2001).

Petitioner timely filed a U.S. Individual Income Tax Return,

Form 1040A, for 1998. On his return, petitioner designated his

filing status as “single”, and he claimed (1) deductions for

dependency exemptions for Corey and Danan and (2) an $800 child

tax credit in respect of Corey and Danan. Petitioner did not

attach to his return Form 8332, Release of Claim to Exemption for

Child of Divorced or Separated Parents, or any other declaration

or statement from Ms. Ary agreeing not to claim exemptions for

Corey and Danan on her return for the year in issue. In this

regard, petitioner testified that Ms. Ary expressly refused to

sign any such form, declaration, or statement.

At trial, petitioner testified that he thinks Ms. Ary

claimed Corey and Danan as dependents on her income tax return

for 1998.

Discussion2

A. Deductions for Dependency Exemptions

Section 151(a) authorizes deductions for the exemptions

provided by that section. In particular, section 151(c)(1)

provides an exemption for each of a taxpayer’s dependents as

defined in section 152. 

Section 152(a)(1) defines the term “dependent” to include a
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3 A second exception to the general rule of sec. 152(e)(1)

exists for certain pre-1985 instruments. See sec. 152(e)(4). 

Pursuant to that exception, a child of divorced parents shall be

(continued...)

taxpayer’s child, provided that more than half of the child’s

support was received from the taxpayer or is treated under

section 152(e) as received from the taxpayer.

In the case of a child of divorced parents, section

152(e)(1) provides as a general rule that the child shall be

treated as receiving over half of his or her support from the

custodial parent. In the event of so-called split or joint

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. Thus, in the present case, Ms. Ary was the

custodial parent of Corey and Danan in 1998, and petitioner was

the noncustodial parent.

Section 152(e)(2) provides an exception to the general rule

of section 152(e)(1). Pursuant to that exception, the child

shall be treated as receiving over half of his or her support

from the noncustodial parent if: 

(A) the custodial parent signs 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 for any

taxable year beginning in such calendar year, and

(B) the noncustodial parent attaches such written

declaration to the noncustodial parent’s return for the

taxable year beginning during such calendar year.[3]
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3(...continued)

treated as receiving over half of his or her support from the

noncustodial parent if: 

(i) a qualified pre-1985 instrument between the

parents * * * provides that the noncustodial parent

shall be entitled to any deduction allowable under

section 151 for such child, and

(ii) the noncustodial parent provides at least

$600 for the support of such child during such calendar

year.

In view of the fact that petitioner and Ms. Ary were married

in 1989, separated in 1996, and divorced in 1997, this second

exception does not apply to the present case. Sec.

152(e)(4)(B)(i).

See sec. 1.152-4T(a), Q&A-3, Temporary Income Tax Regs., 49 Fed.

Reg. 34459 (Aug. 31, 1984). 

The declaration required by section 152(e)(2)(A) must be

made on either Form 8332 or on a statement conforming to the

substance of that form. Id.; Miller v. Commissioner, 114 T.C.

184, 189 (2000). “The exemption may be released for a single

year, for a number of specified years (for example, alternate

years), or for all future years, as specified in the

declaration.” Sec. 1.152-4T(a), Q&A-4, Temporary Income Tax

Regs., 49 Fed. Reg. 34459 (Aug. 31, 1984).

In the present case, Ms. Ary, as the custodial parent, did

not sign Form 8332 or any written declaration or statement

agreeing not to claim exemptions for Corey and Danan, and no such

form, declaration, or statement was attached to petitioner’s

return for the year in issue. It follows, therefore, that the
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exception set forth in section 152(e)(2) does not apply and that

the general rule of section 152(e)(1) does apply. Accordingly,

petitioner is not entitled to deductions for dependency

exemptions for Corey and Danan for 1998. Sec. 152(e)(1); Miller

v. Commissioner, supra.

Petitioner contends that he should be entitled to exemptions

for Corey and Danan because the Iowa State court awarded him the

right to claim such exemptions, at least if he was current on his

support obligation under the decree, which he was for 1998. The

short answer to petitioner’s contention is that a State court

cannot determine issues of Federal tax law. Miller v.

Commissioner, supra at 196. In this regard, section 152(e)

defines the manner in which a noncustodial parent may claim an

exemption for a child, and the provisions of that section

control.

Petitioner also contends that Ms. Ary would not release her

claim to exemptions for Corey and Danan by executing Form 8332 or

an equivalent declaration or statement. That may be so. 

However, such refusal does not serve to change the express

requirements of section 152(e)(2). See Miller v. Commissioner,

supra at 196, where we stated: 

The control over a child’s dependency exemption

conferred on the custodial parent by section 152(e)(2)

was intended by Congress to simplify the process of

determining who is entitled to claim dependency

exemptions for children of a marriage. See H. Rept.

98-432 (Part 2), at 1498 (1984). To make section
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4 See, e.g., sec. 6404(f); Estate of Emerson v.

Commissioner, 67 T.C. 612, 618 (1977).

152(e)(2) work as intended, that control must be

preserved by insisting on adherence to the requirements

of section 152(e)(2) * * *.

Finally, petitioner alleges that an IRS representative

advised him that he could claim exemptions for Corey and Danan

based on the Iowa State court’s decree. However, with exceptions

not applicable to this case,4 the Commissioner is not bound by

erroneous legal advice given by his agents. Dixon v. United

States, 381 U.S. 68, 72-73 (1965); Auto. Club of Mich. v.

Commissioner, 353 U.S. 180, 183-184 (1957); McGuire v.

Commissioner, 77 T.C. 765, 779-780 (1981). In other words,

taxpayers are required to heed, and we are required to give

effect to, the law as actually enacted by Congress and not the

law as it may be misinterpreted by agency representatives.

In view of the foregoing, we sustain respondent’s

determination on this issue. 

B. Child Tax Credit

Section 24(a) authorizes a $400 child tax credit with

respect to each “qualifying child” of the taxpayer. The term

“qualifying child” is defined in section 24(c). As relevant

herein, a “qualifying child” means an individual with respect to

whom the taxpayer is allowed a deduction under section 151. Sec.

24(c)(1)(A).
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We have already held that petitioner is not entitled to

deductions under section 151 for dependency exemptions for his

two youngest sons. Accordingly, neither of petitioner’s two

youngest sons is a “qualifying child” within the meaning of

section 24(c). It therefore follows that petitioner is not

entitled to a child tax credit under section 24(a) in respect of

either such son.

Reviewed and adopted as the report of the Small Tax Case

Division.

To give effect to our disposition of the disputed issues,

Decision will be entered

for respondent.