TAX COURT OPINION

Case: Patrick James Lonergan
Docket Number: 7220-09S
Judge: Colvin
Opinion Type: bench
Filed: 04/30/2010
Pages: 9

UNITED STATES' TAX COURT WASHINGTON, DC 2021 7 PATRICK JAMES LONERGAN , Petitioners, v . Docket No . 7220-09 S COMMISSIONER OF INTERNAL REVENUE . Respondent O R D E R Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it i s ORDERED that the Clerk of the Court shall transmit herewith to petitioner and to respondent a copy of the pages of the .transcript of the trial in the above case before Judge David Gustafson at Washington, D .C . on April 12, 2010, containing his oral findings of fact and opinion rendered .at the conclusion of the trial . In accordance with the oral findings of fact and opinion, decision will be entered for the respondent . ' (Signed) David Gustafson Judg e Dated: Washington, D .C . . April 30, 2010 Se 1 Bench . Opinion by Judge David Gustafson April 15, 2010 2 Lonergan v . Commissioner Docket No . 7220-09S 3 THE COURT : The Court has decided to render 4 oral-Findings of Fact and Opinion in this case, an d 5 the following represents the Court's oral Findings of 6 Fact and Opinion . The oral Findings, of Fact and 7 Opinion shall not be relied on as precedent in any 8 other case . 9 This Bench Opinion is made pursuant to the 10 authority granted by section 7459(b) of the Internal 11 Revenue Code of 1986, as amended, and Rule 152 of the 12 Tax Court Rules of Practice and .Procedure . 13 By a statutory notice of deficiency dated 14 December 15, :2008 [Ex . 5-J], the IRS determined a 15 deficiency in the Federal income tax of petitioner 16 Patrick James Lonergan for the year 2007, in th e 17 amount of $5,574 . The issue in dispute is Mr . 18 Lonergan's entitlement to a dependency exemption and 19 child tax credit for one of his two sons . For th e 20 reasons explained hereafter, we will sustain the 21 deficiency assessed against Mr . Lonergan . 22 Trial of this case was conducted o n 23 April 12, 2010, in Washington, D .C . Mr . Lonergan 24 testified . The parties' Stipulation of Facts, with 25 Exhibits 1-J through 6-R, was admitted into evidence Heritage Reporting Corporatio n (202) 628-4888 4 and is incorporated herein . We find the followin g 2 facts : Findings At the time he filed his. petition, Mr . Lonergan resided in Virginia . [Stip . 1 . ] 6 Mr . Lonergan is married to Victori a 7 Lonergan, and they have two sons, whom we will refer 8 to by their initials, M .P . and M .J ., to protect thei r privacy . M .P . was born in 1992, and M .J . was born i n 10 1994 . [Stip . 2 .] Mr . and Mrs . Lonergan separated in 11 late 2006 and have remained separated since the n 12 [Stip . 3] under the terms of a separation order 13 entered by their local Circuit Court [Stip . 4-5 . ] 14 Under that separation order, the two spouses 15 have joint legal custody of their sons . Mrs . Lonergan 16 has physical custody, and Mr . Lonergan has visitation 17 rights . [Stip . 5-6 .] During 2007 the sons reside d 18 with Mrs . Lonergan for more time than they reside d 19 with Mr Lonergan . [Stip . 7 .] Mr . Lonergan provide s 20 various forms of financial support to his wife an d 21 children, and we assume that he provided the majority 22 of the financial support for the sons in 2007 . [Stip . 23 8-11 . 1 24 On his tax returns for 2005 and 2006, Mr . 25 Lonergan claimed both sons as dependents and Mrs . Heritage Reporting Corporatio n (202) 628-4888 1 Lonergan did not . [Stip . 13 .] On December 31, 2007, 2 Mrs . Lonergan sent an e-mail to Mr . Lonergan [Stip . 3 12], which stated : I just wanted to let you know that .I will be 5 filing my taxes this year as Head of Household and I will be claiming .[M .J .] . You can claim [M . P ] . I think each of us should take one child since we have joint legal custody . [Ex . 2-J . ] 10 On the same day, Mr . Lonergan replied by an e-mail 11 that stated : 12 I don't think so . Without something from 1 3 14 15 the court directing me otherwise, I will claim both of the children just like last year . You already receive support for bot h 16 of them . You shouldn't double-dip and take 17 the exemption as well . [Ex . 2-J . ] 18 The Lonergans did not resolve this disagreement . 19 Contrary to her e-mail, Mrs . Lonergan claimed both 20 sons as dependents on her 2007 return ., [Stip . 15 .] 21 On Mr . Lonergan's 2007 return, he also claimed both 22 sons as dependents, claimed a child tax credit for 23, both sons, and claimed head-of-household status . 24 [Stip . 14 .] He did not attach to his 2007 tax return 25 any Form 8332, "Release of Claim to Exemption for Heritage Reporting Corporatio n (202) 628-4888 6 Child of Divorced or Separated Parents", and he did not attach a copy of Mrs . Lonergan's e-mail . 3 The IRS disallowed Mr . Lonergan's claim o f 4 head-of-household status, dependency exemptions for 5 his sons, and child tax credit . It determined a ta x deficiency of $5,574 . [Stip . 17 .] Mr . Lonergan filed 7 a petition in this Court challenging all thos e disallowances . However, at trial he conceded that he 9 is not entitled to head-of-household status, and that 10 he is not entitled to the dependency exemption and 11 child tax credit for M .J . However, he continues to 12 claim entitlement to the dependency exemption and 13 child tax credit for M .P ., whom Mrs . Lonergan's email 14 said he could claim . 15 Opinion 16 The IRS's determination is presumed correct, 17 and generally the taxpayer bears the burden to prove 18 his entitlement to the exemptions and credits he 19 claimed . Rule°142(a) ; Welch v . Helvering , 290 U .S . 20 111, 115 (1933) . Mr . Lonergan does not contend that 21 the burden of proof has shifted under section 7491(a), 22 and the record does, not suggest any basis for such a 23 contention . 24 Section 151(a) of the Internal Revenue Code 25 provides for a deduction for certain exemptio n Heritage Reporting Corporation (202) 628-4888 , 1 amounts . Section 151(c) allows an exemption for "each 2 individual who is a dependent (as defined in sectio n 3 152)" . The general definition requires that, in orde r to be a "dependent" of the taxpayer, a child must have "the same principal place of abode as the taxpayer for more than one-half of" the tax year . Sec . 152(c) (1) (B) . 8 Section 24 provides for a. tax credit fo r 9 "each qualifying child of the taxpayer" ; and the 10 statute looks to that same definition . Section 11 24(c)(1) provides that " [t]he' term ' qualifying child' 12 means a qualifying child of the taxpayer (as defined 13 in section 152(c))" . Thus, the child tax credit, like 14 the dependency exemption, depends on a child's sharing -DO 15 the "principal place of abode" of the taxpayer . 16 Mr . Lonergan' s sons were both in the 17, physical custody of their mother and did not share Mr . 18 Lonergan's abode . Thus, under the general rule, Mr . 19 Lonergan would not be eligible for the dependenc y 20 exemptions or the child tax credit for either of his 21 sons . 22 However, in section 152(e) the Code includes 23 a "Special Rule for Divorced Parents, Etc ." (In 2007 24 the law in effect was section 152(e) after amendments 25 made in 2004, and the corresponding regulations as in Heritage Reporting Corporatio n (202) 628-4888 8 1 effect before amendments made in 2008 .) That rul e 2 could apply to Mr . Lonergan if "the custodial parent 3 [i .e ., Mrs . Lonergan] signs a written declaratio n * that such custodial parent will not claim such child as a dependent for any taxable year beginning in such taxable year", sec .,152(e)(2)(A), and "th e 7 noncustodial parent [i .e . Mr . Lonergan] attaches such 8 written declaration to the noncustodial parent's ta x return", sec . 152(e)(2)(B) The regulations 10 promulgated under that statute provided that "[t]he 11 written declaration may be made on a form to b e 12 provided by the Service for this purpose . Once the 13 Service has released the form, any declaration made .14 other than on the official form shall conform to th e 15 substance of such form ." 26 C .F .R . 1 .152-4T(A-3) . 16 of 2007, the IRS had prescribed Form 8332 for that 17 purpose .. 18 For purposes of deciding this case we assume 19 that Mrs . Lonergan's e-mail "conform[ed] to th e 20 substance .of" Form 8332, and that she "sign[ed]" her 21 e-mail by typing her name on it . These assumptions 22 may be problematic, because the informality of her e- 23 mail may have caused it to lack the seriousness and 24 deliberateness of Form 8332 (or a closer equivalent 25 thereto), may have contributed to her failure to Heritage Reporting . Corporation (202) 628-4888 9 follow through on her statement, and may thus fail to protect the IRS against duplicate claims for the same children ( such as happened here ) . However, even if we make those assumptions , Mr . Lonergan still fails to qualify for the exception because he did not attach her e-mailed statement to his return . Under the plain terms of the statute, we must . hold against him . 8 The Tax Court is required to apply the law 9 as passed by Congress , and that law requires a 10 "written declaration " signed by the custodial parent 11 and attached to the noncustodial parent's return . The 12 law thus requires that, in order to obtain th e 13 dependency exemption and child tax credit for either 14 of his sons , Mr . Lonergan must have attached to hi s 15 return a "written declaration " signed by Mrs . Lonergan 16 as custodial parent . He did not do so . 17 This may feel like an unfair outcome to the 18 'noncustodial parent who provides most or all-of the 19 financial support for a child but cannot obtain the 20 cooperation of the custodial parent . However, i n 21 section 152 Congress has created several objective 22 tests that draw bright lines . The-alternative would 23 be rules that are sensitive to the wide variety of 24 family circumstances , but such sensitive rules would 25 be difficult for the IRS and the courts to administer , Heritage Reporting Corporation (202) 628-4888 1 0 1 and such sensitive rules would effectively requir e 2 Government intrusion into delicate family matters and 3 intractable human problems . That may be why Congress 4 stopped where it did in making exceptions to th e 5 "place of abode" requirement of section 152 (c ) ( 1) (B) . In any event , the rule of section 152(e)(2) is explicit , and it requires that a noncustodial parent in Mr . Lonergan ' s circumstance , who wishes to claim a dependency exemption and a child tax credit , must file 10 the custodial parent's "written declaration " agreeing 11 to the claim . Mr . Lonergan was unable to meet this 12 requirement , and he is therefore not eligible for the 13 exemption or the credit . 14 Consequently , the deficiency as determined 15 by respondent will be sustained . 16 This concludes the Court ' s oral Findings of 17 Fact and opinion in this case . 18 (Whereupon , at 9 :10 a .m ., the bench opinion .19 in the above - entitled matter was concluded .) 2 0 21 22 23 24 25. Heritage Reporting Corporation (202) 628-4888