TAX COURT OPINION

Case: Carlos Martinez Olivio
Docket Number: 311-07S
Judge: Thornton
Opinion Type: summary
Filed: 09/08/2008
Pages: 7

T .C . Summary Opinion 2008-115 UNITED STATES TAX COUR T CARLOS MARTINEZ OLIVIO, Petitioner v . COMMISSIONER OF INTERNAL REVENUE, Responden t Docket No . 311-07S . Filed . September 8, 2008 . Carlos Martinez Olivio, pro se . Steven D . Tillem and Maria T . Stabile , for respondent . THORNTON , 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 reviewabl e by any other court, an d 1 Unless .otherwise indicated , section references are to the Internal Revenue Code of 1986, as amended and in effect for the year at issue , and Rule references are to the Tax Court Rules of Practice and Procedure . SERVED SEP - 8 2008 . A -2- this opinion shall not be treated as precedent for any othe r case . Respondent determined a $4,043 deficiency in petitioner's :2005 Federal income tax . The issues for decision are : (1) Whether petitioner is entitled to adependency exemption deduction for his cousin ; (2) whether petitioner is entitled to an earned income tax credit ; and (3) whether petitioner i s entitled to a child tax credit . Background The parties have stipulated some facts, which we incorporat e herein . When he petitioned the Court, petitioner . resided in Ne w York . During 2005 petitioner turned 22 years old . He worked in a garage in New York City . He lived in an apartment in New York City with his mother, grandmother, grandfather, sister, and cousin, M .M .,2 who was 9 years old . M .M .'s parents lived in the Dominican Republic . Petitioner was the only one in hisl household who had a job . In addition to contributing to the household expenses, petitioner paid for most of M .M .'s personal expenses including schoo l supplies, clothing, and a trip to Santo Domingo for the child t o visit his parents . . 2 The Court uses initials when referring to a minor child . Rule 27(a) (3) . - 3 - For taxable year 2005 petitioner 'timely filed his income tax return as a head of household . Petitioner claimed his mother and M .M . as dependents and also claimed the earned income tax credit and the child tax credit . In the notice of deficiency respondent disallowed both of petitioner ' s claimed dependency exempt-ion deductions , the earned income credit , and the child tax credit , and' determined petitioner ' s filing status to be single rather than head o f household , thus determining a $4,043 deficiency in his 200 5 Federal income tax . Before trial respondent conceded the dependency exemption for petitioner ' s mother and also conceded petitioner ' s filing status as head of household . 1 . Dependency Exemption Discussio n A taxpayer is entitled to claim a dependency exemption only if the claimed dependent is a "qualifying child" or a "qualifying relative " as defined under section 152(c ) and (d ) . Sec . 152(a) . A qualifying child is defined as the taxpayer ' s child , brother, sister , stepbrother , or stepsister , or a descendant of any of them . Sec . 152 ( c)(2) . Because he is petitioner's cousin, M .M . is not a qualifying child within the meaning of section 152(c)(2) . An individual who is not a qualifying child may still, under certain conditions ; qualify as a dependent if he or she is a qualifying. relative . Sec . 152 ( a) . Under section 152 ( d) .(1), a qualifying relative is an individual :, ;( A) Who bears a qualifying relationship to the taxpayer ; ( B) whose!,gross income - for the year is less than the section 151(d ) exemption amount ($ 2,000 for 2005 ) ; ( C) who receives over one-half of his support from the taxpayer for the taxable year ; and ( D) who is not a qualifying child (cid:127) of the taxpayer or of any other taxpayer for the taxabl e year . Section 152 ( d)(2) lists eight types of qualifying relationships , seven of which involve various familial relationships that do not include cousins . Sec . 152 ( d)(2)(A)- (G) . The eighth type of qualifying relationship applies to a n individual , other than the taxpayer's spouse, who has the same principal place of abode as the taxpayer and is . a member of the taxpayer ' s household for the taxable year . Sec . 152 ( d)(2)(H) . In order for an individual to be considered a member of a taxpayer ' s household , the taxpayer must ; maintain the household , and both the taxpayer and the individual must occupy the household for the entire taxable year . j Sec . 1 .152-1 ( b) ., Income Tax Regs . A taxpayer maintains a household if he or she furnishes more than one-half of the household's expenses . See . sec . 2 ( b) ; Rev . Rul . 64-41, 1964 - 1 C .B . . (Part 1) 84 . Respondent has conceded that petitioner qualifies for hea d of household status and thereby has effectively conceded that A- 5- petitioner maintained the household for 2005 . There is n o dispute that M .M . occupied the household for all of 2005 . f Accordingly , M .M . satisfies the qualifying relationship test pursuant to section 152(d)(2)(H) . In addition , we conclude thattpetitioner provided over one- half of M .M .' s support for 2005 . As suggested by the previous discussion , in conceding that petitioner qualifies for head of household filing status respondent has-effectively conceded that petitioner provided over one-half of'the household ' s expenses . M .M ., as a member of the household , is considered to have received an equal . part of these contributions as his support .' See De La Garza v . Commissioner , 46 T .C . 446 ( 1966 ), affd . per curiam 378 F .2d 32 ( 5th Cir . 1967 ) . Moreover , we have found that petitioner paid for most of M .M's personal expenses . Finally, respondent does not contend and the record does not suggest that M .M .'s,income for 2005 was $ 2,000 or more . As previously discussed , M .M . was not a qualifying child of petitioner ; respondent does not contend and the record does not suggest that he was a qualifying child of any other taxpayer for 2005 . We conclude that for 2005 M .M . was a qualifying relative of petitioner within the meaning of section 152 ( d) and thus petitioner's dependent under section 152(a )( 2) . Accordingly, r petitioner is entitled to a dependency exemption deduction for 6 - M .M . for 2005 . 2 . Earned Income Credi t Section 32(a) permits an "eligible individual" to claim an earned income credit against his income tax liability . An eligible individual is defined in section 32(c)(1)(A) as either (1) any individual who has a qualifying' child for the taxabl e .year, or (2) any other individual who does not have a qualifying child for the taxable year if the individual's principal place o f abode is in the United States for more than one-half of th e taxable year, the individual is between125 and 65 years old before the end of the taxable year, and ; the individual is not a dependent for whom a deduction is allowable under section 151 to another taxpayer . As discussed above, petitioner didinot have a qualifying child for taxable year 2005 . Moreover„ during the year at issu e petitioner turned 22 years old and so did not meet the age requirement of section 32(c)(1)(A)(ii)(LI) . Therefore, petitioner does not qualify for the earned income credit . Respondent's determination on this issue is sustained . 3 . Child Tax Credi t Section 24(a) allows a tax credit for each qualifying child of a taxpayer . For this purpose, a qualifying child means an individual under age 17 who is a qualifying child of the taxpayer I as defined in section 152(c) . Sec . 24(c)(1) . As discussed t above, M .M . is not a qualifying child of petitioner under section 152(c) . Therefore petitioner is not entitled to the child .tax credit for M .M . for taxable year 2005 . Respondent's determination on this issue is sustained . To reflect the foregoing and concessions by respondent , Decision will be entere d under Rule 155 .