PETITIONER APPEARING PRO SE:                  ATTORNEYS FOR RESPONDENT:
WILLIAM R. LARSEN                             CURTIS T. HILL, JR.
Fort Wayne, IN                                ATTORNEY GENERAL OF INDIANA
                                              WINSTON LIN
                                              PARVINDER K. NIJJAR
                                              DEPUTY ATTORNEYS GENERAL
                                              Indianapolis, IN



                               IN THE
                         INDIANA TAX COURT                           FILED
                                                                Jul 31 2017, 10:27 am

                                                                     CLERK
                                                                 Indiana Supreme Court
                                                                    Court of Appeals
WILLIAM R. LARSEN,                           )                        and Tax Court
                                             )
      Petitioner,                            )
                                             )
                    v.                       ) Cause No. 49T10-1503-TA-00008
                                             )
INDIANA DEPARTMENT OF STATE                  )
REVENUE,                                     )
                                             )
      Respondent.                            )


        ORDER ON RESPONDENT’S MOTION FOR SUMMARY JUDGMENT

                                FOR PUBLICATION
                                  July 31, 2017
WENTWORTH, J.

      William R. Larsen challenges the Indiana Department of State Revenue’s

assessment of adjusted gross income tax for the 2013 tax year (the “year at issue”).

The matter is before the Court on the Department’s Motion for Summary Judgment,

asserting that it lawfully denied Larsen’s dependency deductions from his Indiana
adjusted gross income because he did not provide social security numbers for his three

dependent children.1 The Court denies the Department’s Motion.

                          FACTS AND PROCEDURAL HISTORY

       Larsen is a United States citizen who resides in Fort Wayne, Indiana. (Resp’t

Des’g Evid. Supp. Summ. J. (“Resp’t Des’g Evid.”), Ex. 2 ¶ 1.) Larsen has not sought

and does not have social security numbers for any of his three dependent children

because he has a religious objection to obtaining social security numbers for them.

(Resp’t Des’g Evid., Ex. 2 ¶¶ 15-16; see also Pet’r Des’g Evid. Supp. Den. Resp’t Mot.

Summ. J. (“Pet’r Des’g Evid.”), Ex. 6.) Moreover, none of his dependent children have

an IRS-issued individual taxpayer identification number (“TIN”).             (See Resp’t Des’g

Evid., Ex. 5 at 5-7.)

       When Larsen filed his 2013 federal income tax return, he claimed federal

dependency exemptions for each dependent child. (See Resp’t Des’g Evid., Ex. 5 at 7.)

Larsen, however, did not provide social security numbers or TINs for his children on his

federal return. (See Pet’r Des’g Evid., Confd’l Ex. 23 at 3.) Subsequently, the IRS sent

Larsen a letter requesting specific documentation to verify that his children were indeed

his dependents if he had a “religious . . . objection to securing . . . Social Security

Number[s]” for them. (Pet’r Des’g Evid., Ex. 6 (“Letter 3050C”); Hr’g Tr. at 83-85.)

Specifically, Letter 3050C sought documents that would verify each child’s birth and

each child’s identity. (See Pet’r Des’g Evid., Ex. 6 at 1-2.) After Larsen provided the

requested documentation, the IRS granted his federal dependency exemptions. (See

Pet’r Des’g Evid., Confd’l Ex. 23 at 7.)

1
  The parties have designated evidence that contains confidential information. Accordingly, the
Court will provide only that information necessary for the reader to understand its disposition of
the issues presented. See generally Ind. Administrative Rule 9.
                                                2
         When Larsen filed his 2013 Indiana adjusted gross income tax return, he claimed

Indiana dependency deductions for each of his three dependent children on the

Department’s schedule IN-DEP. (Resp’t Des’g Evid., Confd’l Ex. 3 at Exs. 1-2.) In

claiming these deductions, Larsen provided each child’s name, but not social security

numbers, stating his religious objection to obtaining social security numbers for them.

(Resp’t Des’g Evid., Confd’l Ex. 3 at Ex. 2.) The Department subsequently disallowed

the deductions and assessed additional adjusted gross income tax.          (Resp’t Des’g

Evid., Ex. 2 ¶¶ 6, 10.) On July 7, 2014, Larsen protested, and on January 2, 2015, the

Department issued a Letter of Findings denying Larsen’s protest. (Resp’t Des’g Evid.,

Ex. 2 ¶¶ 11-12; Confd’l Ex. 3 at Ex. 4.)

         Larsen initiated this original tax appeal on March 3, 2015. On July 7, 2016, the

Department filed this Motion, and on November 17, 2016, the Court held the hearing.

Additional facts will be supplied as necessary.

                                STANDARD OF REVIEW

         Summary judgment is appropriate when there are no genuine issues of material

fact and the moving party is entitled to judgment as a matter of law. Ind. Trial Rule

56(C).      “When any party has moved for summary judgment, the court may grant

summary judgment for any other party upon the issues raised by the motion although no

motion for summary judgment is filed by such party.” T.R. 56(B).

                                           LAW

         For the purposes of Indiana’s adjusted gross income tax, an individual’s Indiana

adjusted gross income begins with the taxpayer’s federal adjusted gross income, as

defined in IRC § 62.      IND. CODE § 6-3-1-3.5(a) (2013).    This starting point is then



                                             3
modified by various statutory add-backs and deductions. See generally I.C. § 6-3-1-

3.5(a).     For instance, the statute allows a taxpayer to deduct $1,500 from his Indiana

adjusted gross income for each federal dependency exemption allowed under the

Internal Revenue Code. See I.C. § 6-3-1-3.5(a)(5)(A).

          In 2013, a federal dependency exemption was available for a taxpayer’s

dependent child who was younger than 19 or a student under the age of 24. See I.R.C.

§§ 151(c), 152(a), (c)(1)(C), (c)(3) (2013).       Eligibility for a federal dependency

exemption required the taxpayer to provide the dependent’s TIN. I.R.C. § 151(e). A

TIN is generally a person’s social security number, but the IRS allowed a variety of

other numbers to serve as a TIN when a taxpayer does not have a social security

number. See generally I.R.C. §§ 6109(d), 7701(a)(41) (2013); 26 C.F.R. § 301.6109-1

(2013).

                                        ANALYSIS

          The sole issue in this case is whether, as a matter of law, Larsen’s failure to

provide social security numbers for his children on his 2013 Indiana adjusted gross

income tax return prohibits him from receiving dependency deductions under Indiana

Code § 6-3-1-3.5(a)(5)(A). The Department asserts that it has the authority to require

social security numbers, pursuant to Indiana Code § 4-1-8-1, for the purposes of

internal verification and fraud prevention. (See, e.g., Resp’t Mem. Supp. Mot. Summ. J.

(“Resp’t Br.”) at 6.) Larsen responds that the Department does not have the statutory




                                             4
authority to require him to provide social security numbers for his children.2 (Pet’r Mem.

Resp. Den. Resp’t Mot. Summ. J. (“Pet’r Br.”) at 3-5, 12.)

       Indiana Code § 4-1-8-1 states that “[n]o individual may be compelled by any state

agency . . . to provide the individual’s Social Security number to the state agency

against the individual’s will, [but] the provisions of this chapter do not apply to the . . .

Department[.]”   IND. CODE § 4-1-8-1(a)(1) (2013).       This statute, therefore, does not

handcuff the Department’s general authority to request social security numbers from

taxpayers. See I.C. § 4-1-8-1(a)(1); see also IND. CODE § 6-8.1-3-1(a) (2013) (providing

the Department with general authority to administer, collect, and enforce the adjusted

gross income tax).

       The Department exercised its authority to request social security numbers on its

IN-DEP. (See Resp’t Des’g Evid., Confd’l Ex. 3 at Ex. 2.) Nevertheless, Indiana Code

§ 6-3-1-3.5(a)(5)(A) simply states that the Indiana dependency deduction is available for

each federal dependency exemption “allowed” under the Internal Revenue Code. I.C. §

6-3-1-3.5(a)(5)(A). This statutory language imposes no requirement that a dependent’s

social security number be provided to receive Indiana’s dependency deduction.3 See

I.C. § 6-3-1-3.5(a)(5)(A). Indeed, the only statutory eligibility requirement for an Indiana



2
  Larsen also makes a variety of arguments about the validity of the Department’s request for
social security numbers based on the federal and state constitutions, as well as federal and
state Religious Freedom Restoration Acts. (See, e.g., Pet’r Mem. Resp. Den. Resp’t Mot.
Summ. J. at 3-7.) The Court does not address these arguments because it finds in favor of
Larsen on other grounds. See, e.g., Bethlehem Steel Corp. v. Indiana Dep’t of State Revenue,
597 N.E.2d 1327, 1330 (Ind. Tax Ct. 1992) (explaining that when cases are resolved on
statutory grounds, the Court need not address constitutional claims), aff’d, 639 N.E.2d 264
(Ind.1994).
3
  Although social security numbers are not statutorily required to obtain Indiana dependency
deductions, neither is the Department prohibited from requesting them or other documentation
on the IN-DEP for verification and anti-fraud purposes. Accordingly, the Department could
request other evidence similar to that requested in Letter 3050C to further these goals.
                                             5
dependency deduction under Indiana Code § 6-3-1-3.5(a)(5)(A) is receipt of a federal

dependency exemption. See DeKalb Cnty. E. Cmty. Sch. Dist. v. Dep’t of Local Gov’t

Fin., 930 N.E.2d 1257, 1260 (Ind. Tax Ct. 2010) (explaining that when the language of a

statute is clear and unambiguous, the Court may not expand or contract the meaning of

a statute by reading language into it that is not there).

                                      CONCLUSION

        Larsen has provided documentation that verifies the eligibility of his children for

the federal dependency exemptions, and shows those exemptions were allowed. (See

generally Pet’r Des’g Evid., Confd’l Exs. 18-20, 23 at 7.) Under Indiana Code § 6-3-1-

3.5(a)(5)(A), therefore, Larsen was entitled to the Indiana dependency deductions in

2013.    See I.C. § 6-3-1-3.5(a)(5)(A).      Consequently, the Department’s Motion is

DENIED; summary judgment is GRANTED in favor of Larsen.

        SO ORDERED this 31st day of July, 2017.




                                                            Martha Blood Wentworth
                                                            Judge, Indiana Tax Court


Distribution:
William R. Larsen; Winston Lin; Parvinder K. Nijjar




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