TAX COURT OPINION

Case: Candace Buczko
Docket Number: 25917-15S
Judge: Kerrigan
Opinion Type: bench
Filed: 03/16/2017
Pages: 7

28 cT UNITED STATES TAX COURT WASHINGTON, DC 20217 CANDACEBUCZKO, Petitioner(s), v. COMMISSIONER OF INTERNAL REVENUE, Respondent ) ) ) ) ) Docket No. ) ) ) ) 25917-15S. ORD E R 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 Kathleen Kerrigan at Hartford, Connecticut on March 7, 2017, containing her oral findings of fact and opinion rendered at the conclusion of the trial session at which this case was heard. In accordance with the oral findings of fact and opinion, a decision will be entered under Rule 155, Tax Court Practice and Procedure. (Signed) Kathleen Kerrigan Judge Dated: Washington, D.C. March 16, 2017 SERVED Mar162017 Capital Reporting Company 3 1 Bench Opinion by Judge Kathleen Kerrigan 2 March 7, 2017 3 4 5 6 Candace Buczko v. Commissioner Docket No. 25917-15s The Court has decided to render in this case the following as its oral Findings of Fact and 7 Opinion, which shall not be relied upon as precedent 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 in any other case. This proceeding was heard as a Small Tax Case pursuant to the provisions of section 7463 of the Internal Revenue Code (Code) of 1986, as amended, and Rules 170 through 175 of the Tax Court Rules of Practice and Procedure. This Bench Opinion is made pursuant to the authority granted by section 7459(b) of the Code and Rule 152 of the Tax Court Rules of Practice and Procedure. Unless otherwise indicated, all section references are to the Code in effect for the year in issue, and all Rule references are to the Tax Court Rules of Practice and Procedure. By notice of deficiency dated September 14, 2015 respondent determined a deficiency of $4,623 for tax year 2012. The issues for our consideration our: (1) whether petitioner is entitled to a dependency exemption for D.W.R. and K.R.R; (2) whether petitioner is able to file as head of household; (3) 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 4 1 whether petitioner is entitled to an additional child 2 3 4 5 6 tax credit; and (4) whether petitioner is entitled to an earned income credit. Trial in this case was conducted on March 6, 2017 in Hartford, Connecticut. Petitioner represented herself. Respondent was represented by 7 William C. Bogardus. The parties offered exhibits 8 9 10 11 12 13 and several were admitted. We find the following facts: Findings Petitioner resided in Connecticut when she timely filed her petition. She had two children: D.W.R, born in 1998 and K.R.R., born in 1999. In 14 March of 2010 the Department of Children and Families 15 16 17 18 19 20 21 22 of Connecticut removed the children from petitioner's care and the children were not in her care during 2012. Burden of Proof Opinion Petitioner has the burden of proving that respondent's determinations in the 2015 notice of deficiency are in error. See Rule 142(a); Welch v. 23 Helvering, 290 U.S. 111, 115 (1933). Petitioner has 24 25 not contested that the burden of proof has shifted under section 7491(a), and the record does not 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 suggest any basis for such a shift. Dependency Exemption Deductions Section 151 provides that an individual is entitled to annual exemption deductions for his or her dependents. A taxpayer may claim a dependency exemption deduction with respect to an individual who is either a "qualifying child" or a "qualifying relative". Secs. 151(c), 152(a). To be a taxpayer's "qualifying child" an individual must: (1) bear a specified relationship to the taxpayer; (2) have the same principal place of abode as the taxpayer for more than one-half of the taxable year; (3) meet certain age requirements; and (4) have not provided over one-half of his or her own support for the year. Sec. 152(c)(1). Based on evidence in the record and not discussed here in detail, D.W.R. and K.R.R. did not have the same principal place of abode as the taxpayer for more than one-half of the year in issue. 20 Petitioner did not provide any evidence to show that 21 22 23 24 the children lived with her in 2012. Because D.W.R. and K.R.R. are not petitioner's qualifying children under section 152 (c), petitioner may not claim them as dependents for tax year 2012. 25 Filing Status 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 6 1 2 3 4 5 6 7 8 9 10 11 12 13 Section 1(b) provides a special tax rate for an individual who qualifies as a head of household. Section 2(b) provides the requirements for head of household filing status. In order to qualify as a head of a household, petitioner must have been unmarried at the end of 2012 and maintained a household that was the principal place of abode for at least one dependent for more than one-half of the taxable year. See secs. 2(b)(1)(A). Petitioner does not satisfy the requirements of section 2(b) because she has not shown that D.W.R. and K.R.R. were her dependents for 2012. Petitioner must use single filing status in calculating her 2012 tax liability. 14 Additional Child Tax Credits 15 16 17 18 19 20 21 22 23 24 25 Section 24(a) provides a credit with respect to each qualifying child of the taxpayer. 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." Where a taxpayer is eligible for the child tax credit, but the taxpayer's regular tax liability is less than the amount of the child tax credit potentially available under section 24(a), section 24(d) makes a portion of the credit, known as the additional child tax credit, refundable. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company Since D.W. R. and K.R.R. are not qualifying children within the meaning of section 152(c)(1), petitioner is not entitled to additional child tax 7 credits. Earned Income Credit Section 32(a)(1) permits an eligible individual an earned income credit against that individual's income tax liability. The amount of credit varies depending on whether the taxpayer has one qualifying child, two qualifying children, three or more qualifying children, or no qualifying children. Sec. 32(b). A "qualifying child" means a qualifying child of the taxpayer as defined in section 152(c). Sec. 32(c)(3) (A). Since D.W. R. and K.R.R. are not 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 petitioner's qualifying children, she is not entitled 17 18 19 20 to an earned income credit based on her having two qualifying children. To be eligible for an earned income credit as a taxpayer with no qualifying children, a taxpayer 21 must: (1) have a principal place of abode in the 22 United States for more than one-half of the taxable 23 24 25 year; (2) have attained the age of 25 but not have attained age 65 before the close of the taxable year; and (3) not be a dependent of another taxpayer. Sec. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 8 1 2 3 4 5 6 7 8 32 ( c) (1) (A) . I f petitioner' s modified adjusted income for 2012 does not exceed the section 32(a)(2) limitation of $13,980 for 2012 and petitioner meets the eligibility requirements for an earned income credit based on no qualifying children, her earned income credit should be recomputed. A decision will be entered under Rule 155. This concludes the Court's oral Findings of Fact and 9 Opinion in this case. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 (Whereupon, at 11:47 a.m., the above- entitled matter was concluded.) 866.488.DEPO www.CapitalReportingCompany.com