TAX COURT OPINION

Case: Steven Teterrian McIntyre
Docket Number: 2059-15
Judge: Goeke
Opinion Type: bench
Filed: 07/12/2016
Pages: 9

UNITED STATES TAX COURT WASHINGTON, DC 20217 STEVEN TETERRIAN MCINTYRE, Petitioner(s), v. COMMISSIONER OF INTERNAL REVENUE, Respondent ) ) ) ) ) Docket No. 2059-15. ) ) ) ) ORDER Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is 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 Joseph Robert Goeke at Nashville, Tennessee on June 17, 2016, containing his oral findings of fact and opinion rendered at the trial session at which this case was heard. In accordance with the oral findings of fact and opinion, an appropriate decision will be entered. (Signed) Joseph Robert Goeke Judge Dated: Washington, D.C. July 11, 2016 SERVED JUL 1 4 2016 Capital Reporting Company 3 Bench Opinion by Joseph Robert Goeke June 17, 2016 Steven Teterrian McIntyre v. Commissioner Docket No. 2059-15 THE COURT: The Court has decided to render oral findings of fact and opinion in this case, and the following represents the Court's oral findings of fact and opinion: The oral findings of fact and opinion shall not be relied upon as precedent in any other case. This opinion is rendered pursuant to the Tax Court Rule of Practice and Procedure 152, and rule references in this bench opinion are to the Tax 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Court Rules of Practice and Procedure. 16 This case 1s a deficiency case where the 17 Petitioner timely filed a petition upon his receipt 18 19 20 21 22 23 24 25 of the notice of deficiency from the Respondent for the taxable years 2011 and 2012. The deficiencies asserted in income tax are $3,000 for 2011 and $1,713 for 2012. Respondent also asserts the late filing penalty under Section 6651(a) for the year 2011 in the amount of $346.50. The primary issue in the case is whether 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 4 1 2 3 4 5 6 7 8 9 the Petitioner is entitled to a dependency exemption for his son for the years 2011 and 2012. This issue also has related to it whether Mr. McIntyre is entitled to a child tax credit and whether he is to be treated as head of household on his 2011 and 2012 income tax returns. He also contests the addition to tax for the late filing penalty for 2011. The parties stipulated facts and Mr. 10 McIntyre testified briefly at trial. 11 12 13 14 15 16 17 18 19 Mr. McIntyre and his former spouse entered into a document characterized as a permanent parenting plan order, which document was approved and ordered by Shelby County, Tennessee Chancery Court on July 20th, 2009. That document does not have the signature of Mr. McIntyre's former spouse on every page, but it does have the signature on the last page of the document. The page of the document that Mr. McIntyre 20 would have us focus on is Page 4, which provides that 21 Mr. McIntyre would be entitled to claim his son as a 22 23 24 25 dependent for tax purposes. That page is not signed by either spouse. I also note that the permanent parenting plan order makes clear and it is not disputed that 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 5 1 Mr. McIntyre's former spouse was the custodial parent 2 3 of the child in question. Regarding the 2011 income tax return Mr. 4 McIntyre does not deny that the return was ultimately 5 not signed and filed until June of 2012, but he 6 maintains that he made every effort to timely file 7 8 9 10 11 12 13 the return and that only problems with his computer and the IRS's rejection of the original return he did timely mail, because he had inadvertently failed to put his signature on there after having printed the document from his computer, have caused him to be treated as a delinquent taxpayer for 2011. We'll first deal with the question of 14 whether Mr. McIntyre is entitled to a dependent for 15 his son in 2011 and 2012, and the resulting issues of 16 whether he is entitled to the child credit claimed 17 18 19 20 21 22 23 24 25 and head of household filing status. We first note that for taxable years starting after July 2nd, 2002, a court order is not sufficient to meet the requirements demonstrating that the custodial parent waives her rights to the claimed dependency exemption, pursuant to Treasury Reg. Section 1.152-4(c)(1)(ii) of the Income Tax Regs. regidon The r±.crd provides as follows in pertinent 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 6 part: A written declaration not on the form designated by the IRS must conform to the substance of that form and must be a document executed for the sole purpose of serving as a written declaration under this section. A court order or decree or a separation agreement may not serve as a written declaration, end of quoted material. See also Armstrong v. Commissioner, 139 T.C. 468,472, Note 6(2012). Section 151 allowed the taxpayer to deduct an exemption amount for each individual who is a dependent of the taxpayer for the taxable year. Section 152(a)(1) defines a dependent as a qualifying child. Generally a qualifying child must bear a specified relationship to the taxpayer, such as a child of the taxpayer. Must also have the same principal place of abode as the taxpayer for more than one-half of the year, must meet certain age requirements and must receive over one-half of his or her support 4er the year for the party claiming the dependency exemption. The dependent must also not have filed a joint return. As stated previously, Mr. McIntyre agrees that his son did not live with him in the year in question. Section 152(e) provides a special rule to 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 7 1 2 3 4 determine which parent is entitled to a dependency exemption deduction for a child of divorced or separated parents. In general a child who is in the custody of one or both of the child's parents for 5 more than half the year, and who receives more than 6 7 8 9 10 11 12 13 14 15 16 17 18 half of his or her support from those parents who are divorced or separated, or who live apart at all times during the last six months of the calendar year, will be considered the qualifying child of the custodial parent. Section 152(e)(1). Swint v. Commissioner, 142 T.C. 131,133 (2014). Section 152(e)(4)(a) defines the custodial parent as the parent having custody for the greater portion of the calendar year. That's not a disputed item in the current case. Pursuant to Section 152(e) the dependent child may be treated as a qualifying child of the non-custodial parent if the custodial parent signs a 19 written declaration in the manner and form as 20 provided by the Secretary, that such custodial parent 21 will not claim the child as a dependent for any 22 23 24 taxable year beginning in the calendar year for which the dependent is claimed. Section 152(e) (2) (A). If the custodial parent signs such a 25 written declaration, the non-custodial parent must 866.488.DEPO www.Capita1ReportingCompany.com Capital Reporting Company 8 1 2 3 4 5 6 7 8 attach it to the non-custodial parent's return for the taxable year beginning during such calendar year. Section 152(e)(2)(e). Mr. McIntype simply failed to attach the appropriate form, claims that he sent and attached the order that was previously discussed, however, as described in the Treasury Regulation and in Swint v. Commissioner, supra, that form simply does not qualify to support Mr. McIntyre's claim of 9 waiver by the non-custodial parent. 10 11 12 13 14 15 Section 1.152-4(e)(1)(I) of the income tax regs provides that the written declaration must be an unconditional release and would not be available to the non-custodial parent if there are any conditions upon the release. And the Treasury Regulations also provide that the non-custodial parent must attach a 16 copy of the written declaration to each return on 17 which the child is claimed as a dependent. Section 18 19 20 21 22 23 24 25 1.152-4(e)(2) Income Tax Regs. The form provided in the regulations is Form 8332. There's no question that that form was not submitted in the present case and is not available to Mr. McIntyre. We're sympathetic to Mr. McIntyre's concerns that he should receive the dependency exemption for his son pursuant to the State Court 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 9 1 2 3 4 5 order; however, the State Court order does not control the federal income tax result. Finally we note that post-trial the parties submitted an informal memorandum which they jointly submitted, in which Mr. McIntyre argued the case of 6 Allred v. Commissioner, 2014-54 T.C. Memo. We 7 believe Mr. McIntyre's reliance on that case is 8 misplaced as the result of that case actually 9 supports Respondent's position in the present matter. 10 In summary, the law clearly does not permit 11 Mr. McIntyre to have the dependency exemption for his 12 13 14 15 16 17 18 19 20 21 22 23 son for either of the years in question, and as a result he's not entitled to the child care credit nor to head of household filing status. Finally we analyze whether Mr. McIntyre should be liable for the addition to tax for 2011 as a result of the failure to timely file the income tax return for that year. Section 6651(a) of the Internal Revenue Code in effect for the years in question provides that the addition to tax will not apply if the failure to timely file was due to a reasonable cause and not due to willful neglect. Based upon Mr. 24 McIntyre's testimony and the undisputed circumstances 25 under which the return was filed delinquently, we 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 1 believe he did have a reasonable cause and he did not 2 willfully neglect his obligations to timely file a 10 federal income tax return. And, therefore, we do not sustain the addition to tax. Accordingly, a decision will be entered for the Respondent concerning the income tax deficiencies and for Mr. McIntyre concerning the addition to tax for 2011. THIS CONCLUDES THE COURT'S ORAL FINDINGS OF FACT AND OPINION IN THIS CASE. (Whereupon, at 1:45 p.m., the above- entitled matter was concluded.) 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 866.488.DEPO www.CapitalReportingCompany.com