                  T.C. Summary Opinion 2005-168



                     UNITED STATES TAX COURT



                 ANDRE L. WILSON, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 15788-04S.             Filed November 15, 2005.


     Andre L. Wilson, pro se.

     Amy Dyar Seals, for respondent.



     GOLDBERG, Special Trial Judge:    This case was heard pursuant

to the provisions of section 7463 of the Internal Revenue Code in

effect at the time the petition was filed.   The decision to be

entered is not reviewable by any other court, and this opinion

should not be cited as authority.   Unless otherwise indicated,

subsequent section references are to the Internal Revenue Code in

effect for the year in issue, and all Rule references are to the

Tax Court Rules of Practice and Procedure.
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     Respondent determined a deficiency in petitioner’s Federal

income tax of $4,766 for the taxable year 2003.

     The issues for decision are:    (1) Whether petitioner is

entitled to claim dependency exemption deductions for KO and NW;1

(2) whether petitioner is entitled to head-of-household filing

status; (3) whether petitioner is entitled to an earned income

credit; and (4) whether petitioner is entitled to a child tax

credit for taxable year 2003.

                           Background

     Some of the facts have been stipulated and are so found.

The stipulation of facts and the attached exhibits are

incorporated herein by this reference.      Petitioner resided in

Estill, South Carolina, on the date the petition was filed in

this case.

     During taxable year 2003, petitioner was involved in a

romantic relationship with Sandra Orr (Ms. Orr).      Ms. Orr had two

children, KO and NW, from prior relationships.      KO and NW lived

with Ms. Orr during taxable year 2003.

     Ms. Orr did not work during taxable year 2003.      During

taxable year 2003, Ms. Orr was entitled to receive $62 per week

in child support from KO’s father.      KO and NW had health

insurance for taxable year 2003 through Medicare and/or Medicaid;

neither petitioner nor Ms. Orr made payments for this health


     1
      The Court uses only the minor children’s initials.
                                - 3 -

insurance.   During 2003, Ms. Orr, KO, and NW received the

following financial benefits:   (1) Food stamps for Ms. Orr and

her children; (2) a settlement from Social Security of

approximately $6,000 “after they took out for the lawyers” for a

disability suffered by Ms. Orr; and (3) $152 per month in Social

Security benefits as a result of NW’s father being deceased.   As

a result of these benefits, NW received a Form SSA-1099, Social

Security Benefit Statement, for taxable year 2003 which reported

benefits received of $1,824.

     In 2003, KO, who was 17 years old and a high school senior,

was employed by Shell-Mark Enterprises and Marshalls of

Massachusetts, Inc.   Shell-Mark issued to KO a Form W-2, Wage and

Tax Statement, which reflected wages earned of $5,173 for taxable

year 2003.   Marshalls of Massachusetts, Inc., issued to KO a Form

W-2 which reflected wages earned of $678 for taxable year 2003.

     During taxable year 2003, petitioner was employed as a

roofer by Roofing Professionals, Inc. (Roofing) and Low Country

Roofing, Inc. (Low Country).    Roofing and Low Country each issued

to petitioner a Form W-2 which reflected wages earned during

taxable year 2003 of $9,636 and $9,210, respectively.

     Petitioner timely filed his Form 1040, U.S. Individual

Income Tax Return, for taxable year 2003 as a head of household

and claimed dependency exemption deductions for KO and NW.

Petitioner also claimed an earned income credit with KO and NW as
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qualifying children and a child tax credit with KO and NW as

qualifying children.

     On the face of his Form 1040, petitioner claims that these

children are his foster children.    However, petitioner is not

related to either child and is not married to their mother.

Furthermore, these children were not placed with him by an

authorized child placement agency.

     On September 7, 2004, respondent issued a notice of

deficiency denying petitioner:    (1) The claimed dependency

exemption deductions; (2) head-of-household filing status; (3)

the claimed earned income credit; and (4) the claimed child tax

credit for taxable year 2003.

                              Discussion

     In general, the Commissioner’s determination set forth in a

notice of deficiency is presumed correct.    Welch v. Helvering,

290 U.S. 111, 115 (1933).   In pertinent part, Rule 142(a)(1)

provides the general rule that “The burden of proof shall be upon

the petitioner”.   In certain circumstances, however, if the

taxpayer introduces credible evidence with respect to any factual

issue relevant to ascertaining the proper tax liability, section

7491 places the burden of proof on the Commissioner.    Sec.

7491(a)(1); Rule 142(a)(2).    Credible evidence is “‘the quality

of evidence which, after critical analysis, * * * [a] court would

find sufficient * * * to base a decision on the issue if no
                                - 5 -

contrary evidence were submitted’”.2     Baker v. Commissioner, 122

T.C. 143, 168 (2004) (quoting Higbee v. Commissioner, 116 T.C.

438, 442 (2001)).    Section 7491(a)(1) applies only if the

taxpayer complies with substantiation requirements, maintains all

required records, and cooperates with the Commissioner for

witnesses, information, documents, meetings, and interviews.

Sec. 7491(a)(2).    Although neither party alleges the

applicability of section 7491(a), we conclude that the burden of

proof has not shifted to respondent with respect to any of the

issues in the case at bar.

      Moreover, deductions are a matter of legislative grace and

are allowed only as specifically provided by statute.      INDOPCO,

Inc. v. Commissioner, 503 U.S. 79, 84 (1992); New Colonial Ice

Co. v. Helvering, 292 U.S. 435, 440 (1934).

1.   Deduction for Dependency Exemption

      Section 151 allows deductions for exemptions for dependents

of the taxpayer.    See sec. 151(c).    Section 152(a) defines the

term “dependent”, in pertinent part, to include “An individual *

* * who, for the taxable year of the taxpayer, has as his

principal place of abode the home of the taxpayer and is a member

of the taxpayer’s household * * * over half of whose support, for


      2
      We interpret the quoted language as requiring the
taxpayer’s evidence pertaining to any factual issue to be
evidence the Court would find sufficient upon which to base a
decision on the issue in favor of the taxpayer. See Bernardo v.
Commissioner, T.C. Memo. 2004-199.
                                - 6 -

the calendar year * * * was received from the taxpayer”.

“Support” includes “food, shelter, clothing, medical and dental

care, education, and the like.”    Sec. 1.152-1(a)(2)(i), Income

Tax Regs.

     In determining whether an individual received more than one-

half of his or her support from the taxpayer, there shall be

taken into account the amount of support received from the

taxpayer as compared to the entire amount of support which the

individual received from all sources.     Id.   In other words, the

support test requires the taxpayer to establish the total support

costs for the claimed individual and that the taxpayer provided

at least half of that amount.     Archer v. Commissioner, 73 T.C.

963, 967 (1980); see Cotton v. Commissioner, T.C. Memo. 2000-333;

Gulvin v. Commissioner, T.C. Memo. 1980-111, affd. 644 F.2d 2

(5th Cir. 1981); Toponce v. Commissioner, T.C. Memo. 1968-101.        A

taxpayer who cannot establish the total amount of support costs

for the claimed individual generally may not claim that

individual as a dependent.   Blanco v. Commissioner, 56 T.C. 512,

514-515 (1971); Cotton v. Commissioner, supra.

     As previously stated, on his 2003 Federal income tax return,

petitioner claimed dependency exemption deductions for KO and NW.

     Petitioner testified that he has lived with Ms. Orr and her

children, KO and NW, from taxable year 2000 through the date of

trial (February 2005).   Petitioner further testified that (1) the
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residence which petitioner claims he, Ms. Orr, and her children

live in is solely in Ms. Orr’s name, and (2) that the bills which

result from the residential expenses are also only in Ms. Orr’s

name.

     Petitioner’s legal address is still listed as his parents’

address.   Petitioner testified that he has not changed his legal

address since moving in with Ms. Orr because Ms. Orr’s residence

is not equipped to receive mail.   Petitioner claims that he and

Ms. Orr are in the process of obtaining a post office box.

     Petitioner also testified that he supported KO and NW during

taxable year 2003.   However, petitioner failed to provide the

Court with any significant corroborative evidence showing that he

provided over half of KO and NW’s support during the 2003 taxable

year.

     Upon the basis of the record before us, we find that

petitioner has not established that his home during taxable year

2003 was the principal place of abode of KO and NW.     Further, we

find that petitioner has failed to establish the total support

costs for the claimed individuals, KO and NW, and that he

provided at least half of that amount.   Respondent’s

determination on this issue is sustained.
                                - 8 -

2.   Head of Household

      As previously stated, petitioner filed his 2003 Federal

income tax return as a head of household, and respondent changed

the filing status to single in the notice of deficiency.

      Section 1(b) imposes a special income tax rate on an

individual filing as head of household.     Section 2(b) provides

the requirements for head-of-household filing status.     As

relevant here, to qualify as a head of a household a taxpayer

must (a) be unmarried at the end of the taxable year, (b) not be

a surviving spouse, and (c) maintain as the taxpayer’s home a

household that constitutes the principal place of abode of a

dependent for whom the taxpayer is entitled to claim a deduction

under section 151.   Sec. 2(b)(1)(A)(ii).

      We have already held that petitioner is not entitled to the

dependency exemption deductions pursuant to section 151 with

respect to KO and NW.    It follows, therefore, that petitioner is

not entitled to claim head-of-household filing status.     We

sustain respondent’s determination with respect to this issue.

3.   Earned Income Credit

      As previously stated, petitioner claimed an earned income

credit for taxable year 2003 with KO and NW as qualifying

children.   In the notice of deficiency, respondent disallowed the

earned income credit.
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     Subject to certain limitations, an eligible individual is

allowed a credit which is calculated as a percentage of the

individual’s earned income.    Sec. 32(a)(1).     Earned income

includes wages.    Sec. 32(c)(2)(A).     Section 32(c)(1)(A)(i), in

pertinent part, defines an “eligible individual” as “any

individual who has a qualifying child for the taxable year”.       A

“qualifying child” is one who satisfies a relationship test, a

residency test, and an age test.    Sec. 32(c)(3).     The pertinent

parts of section 32(c)(3) provide:

     (3) Qualifying child.--

          (A) In general.--The term “qualifying child” means,
     with respect to any taxpayer for any taxable year, an
     individual--

               (i) who bears a relationship to the taxpayer
          described in subparagraph (B),

               (ii) who has the same principal place of abode as
          the taxpayer for more than one-half of such taxable
          year, and

               (iii) who meets the age requirements of
          subparagraph (C).

          (B) Relationship test.--

               (i) In general.--An individual bears a
          relationship to the taxpayer described in this
          subparagraph if such individual is–-

                       (I) a son, daughter, stepson, or
                  stepdaughter, or descendant of any such
                  individual,

                       (II) a brother, sister, stepbrother, or
                  stepsister, or a descendant of any such
                  individual, who the taxpayer cares for as the
                  taxpayer’s own child, or
                                - 10 -

                     (III) an eligible foster child of the
                taxpayer.

                *       *   *   *    *   *    *

                (iii) Eligible foster child.--For purposes of
           clause (i), the term “eligible foster child” means an
           individual not described in subclause (I) or (II) of
           clause (i) who--

                     (I) is placed with the taxpayer by an
                authorized placement agency, and

                     (II) the taxpayer cares for as the taxpayer’s
                own child.

      As previously stated, petitioner has not established that

his home during taxable year 2003 was the principal place of

abode for KO and NW for more than one-half of the taxable year.

Further, as previously stated, petitioner is not related to

either child, he is not married to their mother, and these

children were not placed with him by an authorized placement

agency.   We find that KO and NW fail the residency test of

section 32(c)(3)(A)(ii) and the relationship test of section

32(c)(3)(B); therefore, we need not and do not decide whether

they satisfy the age test under section 32(c)(3).

      Accordingly, respondent’s determination on this issue is

sustained.

4.   Child Tax Credit

      As previously stated, petitioner claimed a child tax credit

for taxable year 2003 with KO and NW as qualifying children.     In
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the notice of deficiency, respondent disallowed the child tax

credit.

     Section 24(a) authorizes a child tax credit with respect to

each “qualifying child” of the taxpayer.     The term “qualifying

child” is defined in section 24(c).     As relevant here, a

“qualifying child” means an individual with respect to whom the

taxpayer is allowed a deduction under section 151.     Sec.

24(c)(1)(A).

     We have already held that petitioner is not entitled to

dependency exemption deductions under section 151 for KO and NW.

Accordingly, KO and NW are not considered “qualifying children”

within the meaning of section 24(c).     It follows, therefore, that

petitioner is not entitled to a child tax credit under section

24(a) with respect to KO and NW.

     In view of the foregoing, we sustain respondent’s

determination on this issue.

     Furthermore, we have considered all of the other arguments

made by petitioner, and, to the extent that we have not

specifically addressed them, we conclude they are without merit.

     Reviewed and adopted as the report of the Small Tax Case

Division.


                                      Decision will be entered

                               for respondent.
