TAX COURT OPINION

Case: Francisco Martinez Camarillo
Docket Number: 22992-09S
Judge: Dean
Opinion Type: summary
Filed: 04/18/2011
Pages: 6

Ig T.C. Summary Opinion 2011-53 UNITED STATES TAX COURT FRANCISCO MARTINEZ CAMARILLO, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 22992-095. Filed April 18, 2011. Francisco Martinez Camarillo, pro se. Kevin W. Coy, for respondent. DEAN, Special Trial Judge: This case was heard pursuant to the provisions of section 7463 of the Internal Revenue Code in effect when the petition was filed. Pursuant to section 7463(b), the decision to be entered is not reviewable by any other court, and this opinion shall not be treated as precedent for any other case. Unless otherwise indicated, subsequent section references are to the Internal Revenue Code (Code) in effect for the year in SERVED APR 18 2011 - 2 - issue, and all Rule references are to the Tax Court Rules of Practice and Procedure. Respondent determined a deficiency of $5,895 in petitioner's Federal income tax for 2008. After concessions,1 the issues for decision are whether petitioner is entitled to the earned income tax credit (EITC) and the additional child tax credit. Some of the facts have been stipulated and are so found. Background The stipulation of facts and the attached exhibits are incorporated herein by reference. Petitioner resided in California= when he filed his petitions. At the time of trial petitioner had lived with his girlfriend (Ms. Alejandre) for 12 years, which included the year at issue. Ms. Alejandre is the biological mother of D.Z. and J.L. The children have lived with petitioner since they were "very young". Petitioner is not the biological father of D.Z. or J.L., nor has petitioner adopted either child. Petitioner electronically filed his Federal income tax return for 2008. He reported businese income of $13,938 on the return, and his adjusted gross income was $12,953. On his return petitioner claimed the EITC and the additional child tax credit. Respondent disallowed both credits. Respondent concedes that petitioner is entitled to dependency sexemption deductions for DjZa and J.L. redacts the names of minor children. See Rule 27(a) (3). The Court - 3 - Discussion I. Burden of Proof Generally, the Commissioner's determinations are presumed correct, and the taxpayer bears the burden of proving that those determinations are erroneous.2 Rule 142(a); see INDOPCO, Inc. v. Commissioner, 503 U.S. 79, 84 (1992); Welch v. Helvering, 290 U.S. 111, 115 (1933). Deductions and credits are a matter of legislative grace, and the taxpayer bears the burden of proving that he is entitled to any deduction or credit claimed. Rule 142(a).; Deputy v. du Pont, 308 U.S. 488, 493 (1940); New Colonial Ice Co. v. Helvering, 292 U.S. 435, 440 (1934). II. EITC Section 32(a) (1) allows an "eligible individual" an EITC | against that individual's income tax liability. Section 32(a) (2) provides limitations on the amount of.the-allowable credit based on certain percentages and amounts (as determined by section 32(b)). Generally, the limitation amount is based on the amount of the taxpayer's earned income and whether the taxpayer has no qualifying children, one qualifying child, or two or more qualifying children, as defined in section 152(c). Sec. 32(a), (b), and (c). 2Petitioner has not claimed or, shown that he meets the requirements under sec. 7491(a) respondent as to any factual to shift the burden of proof to issue relating to his tax liability. - 4 - Under section 152 (c) ( ) (A) the~term "qualifying child" means an individual "who bears a relationship to the taxpayer described in-paragraph (2 )1"7.6 i Anrirndividuah bears as-relationship to' a taxpayer for.purposes ofesection 15-2(c) (1):(A) if the indigidual, is 2"a child of the taapayer or a descendant«of asuch a.child" or, "atbrothet sister stépbrother, orfstepsister of the .taxpayer or a des cendant of any such re lat ive . " Sec . 152 ( c ) (2):. & At trial 'petitiioner .testified .that -although the : children had elived with him-sinceutheyawëre "very young"s; he had taken, no - st'èÿs t·o ad_opt or otherwise legally recognize -the children as - his . Under the . Code ,- Dr. Z . and' J. L . do not bear a , re lat ionship to petitioner. Therefore, D.Z. and J.Lë are not petitioner's qualifying children for purposes of the EITC under section 32 (a))(1) . Individuals .without qualifying children, however,' may-be eligible for an EITC if their earned income is no greater- than the -amount that -the :Code permits . Sec . 32 (a) (1) -, (b) ,(2) , . ( j ) (1) ; see Rowe v." Commissiônër, -1-28 T.C. -13, 15 -(2007) .-Earned,income for purposes of the EITC includes wages and -net earnings from. self -employment . Sec . 32 (c) (2) ; sec . 1. 32-2 (c ) (2) , Income Tax Regs C triThe children' s -relationship to petitionergis the orf y 3 factorrof the qualifying childetest ataissue ..r .a - 5 - Rev. Proc. 2007-66, sec. 3.07, 2007-2 C.B. 970, 973, lists the amounts used to determine the EITC for 2008 under section 32(b). The revenue procedure lists $12,880 as the completed phaseout amount. Id. The "completed phaseout amount" is the amount of adjusted gross income (or, if greater, earned income) at or above which no credit is allowed. Id. Petitioner's adjusted gross income and earned income both exceeded the phaseout amount of $12,880 for 2008. Accordingly, he is ineligible to claim an EITC under section 32(c) (1) (A) (ii) as an individual without a qualifying child for 2008. Respondent's determination is sustained. III. Additional Child Tax Credit Subject to limitations based on adjusted gross income, section 24(a) provides a credit with respect to each qualifying child of a taxpayer. A portion of the cred'it is refundable. Sec. 24(d). The refundable portion of the credit is commonly referred to as the additional child tax credit. Section 24(c) (1) defines the term "qualifying child" as a."qualifying child of the taxpayer (as defined in section 152(c)) who has not attained age 17." As discussed above, D.Z. and J.L. are not petitioner's qualifying children under section 152(c). Therefore, petitioner does not have any qualifying children and is not entitled to the section 24(d) additional child tax credit for 2008. Respondent's - 6 - determination is sustained. To reflect the foregoing, Decision will be entered under Rule 155. i-