                  T.C. Summary Opinion 2001-139



                     UNITED STATES TAX COURT



        RANDY & CHARLISS CUSHING FERIANTE, Petitioners v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 187-00S.                  Filed September 5, 2001.



     Randy Feriante, pro se.

     G. Michelle Ferreira, for respondent.



     DINAN, 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.
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     Respondent determined a deficiency in petitioners’ Federal

income tax of $1,006 for the taxable year 1995.

     The issue for decision is whether petitioners are entitled

to a deduction for alimony payments in excess of the amount

allowed by respondent.

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

The stipulations of fact and the attached exhibits are

incorporated herein by this reference.   Petitioners resided in

Palo Alto, California, on the date the petition was filed in this

case.

     Petitioner husband (petitioner) separated from his former

wife, Laura Feriante (Ms. Feriante), in 1992.   After their

separation, petitioner purchased a residence in Palo Alto,

California, solely in his name.   Ms. Feriante and petitioner’s

son, David, resided at this residence during the year in issue,

1995.   Ms. Feriante eventually met Paul Kent, who moved into the

Palo Alto residence and then married Ms. Feriante during 1995.

     The Superior Court of the State of California in and for the

County of Santa Clara ordered petitioner in 1992 to pay Ms.

Feriante monthly spousal support of $4,373 and monthly child

support of $2,007.   Petitioner’s marriage to Ms. Feriante

subsequently was dissolved in 1993.    A supplemental judgment was

entered by the court in August 1995.   This judgment reduced the

monthly child support obligation to $1,800, stated that the
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obligation to make alimony payments to Ms. Feriante ceased by

operation of law1 and gave Ms. Feriante the Palo Alto residence

as her sole property.   Under both the predissolution order and

the supplemental judgment, the child support payments were to be

paid to Ms. Feriante.

     During 1995 petitioner made a series of payments in

connection with the Palo Alto residence.   He made six monthly

mortgage payments of $1,664.81 to the lender and paid property

taxes of $2,884.66 to the county.   Also during 1995, petitioner

made a series of monthly payments directly to Ms. Feriante:     In

January the payment was $3,500, in February through June the

payments were $2,000 each, and in July through December the

payments were $1,800 each.

     On their 1995 joint Federal income tax return, petitioners

claimed a deduction of $15,574 for alimony payments.   In the

statutory notice of deficiency respondent disallowed all but

$1,500 of this deduction.2



     1
      The obligation presumably ceased by operation of law upon
Ms. Feriante’s remarriage. The exact date in 1995 of the
marriage is not in the record.
     2
      Respondent also allowed petitioners an additional itemized
deduction for mortgage interest expense of $8,367 and an
additional credit for prior year minimum tax, both of which
obviously are not disputed by petitioners. In addition,
respondent made adjustments to the total amounts of petitioners’
itemized deductions and exemption deductions. These are
computational adjustments which will be resolved by the Court’s
holding on the issue in this case.
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     “Alimony or separate maintenance payments” are deductible by

the payer in the year paid if they are includable in the payee

spouse’s gross income under section 71.   Sec. 215(a) and (b).

Subject to further requirements not relevant here, the phrase

“alimony or separate maintenance payment” is defined as “any

payment in cash if * * * such payment is received by (or on

behalf of) a spouse under a divorce or separation instrument”.

Secs. 215(a), 71(b)(1)(A).   Thus, payments of cash to third

parties on behalf of the payee spouse may qualify as alimony or

separate maintenance payments.    Sec. 71(b)(1)(A).   However, the

payments must be made pursuant to the terms of the divorce or

separation instrument.   Id.; sec. 1.71-1T(b), Q&A-6 and 7,

Temporary Income Tax Regs., 49 Fed. Reg. 34455 (Aug. 31, 1984).

If the payments instead are made in lieu of payments required to

be made to the spouse, they qualify as alimony or separate

maintenance payments only if they are made pursuant to a written

request, consent, or ratification from the payee spouse.      Id.

Finally, a payment is not includable in the payee spouse’s gross

income under section 71 if it is fixed by the divorce or

separation instrument as payable for the support of the payer

spouse’s children.   Sec. 71(c)(1).

     The mortgage and tax payments were not made pursuant either

to a divorce or separation instrument or to a written request,

consent, or ratification from Ms. Feriante.   Further, whether Ms.
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Feriante had a community property interest in the residence,

which may have been acquired by petitioner prior to the divorce,

is unclear.   In any case, petitioner owned at least a one-half

interest in the property.   For these reasons, the mortgage and

tax payments are not alimony or separate maintenance payments.

Sec. 71(b)(1)(A); sec. 1.71-1T(b), Q&A-6, 7, Temporary Income Tax

Regs., 49 Fed. Reg. 34455 (Aug. 31, 1984).

     Because the payments made by petitioner directly to Ms.

Feriante were for child support, these payments also are not

alimony or separate maintenance payments.    Sec. 71(c)(1).

Petitioners argue that the cash payments petitioner made in

January through June were alimony payments, while the mortgage

and tax payments made in those months were made to fulfill

petitioner’s child support obligations.   We find this argument to

be disingenuous:   The record clearly indicates the cash payments

were child support.

     First, as previously noted, petitioner owned the residence

in which Ms. Feriante and petitioner’s son resided.    Despite

petitioner’s assertions to the contrary, we find it unlikely that

a court-ordered obligation to pay Ms. Feriante a sum certain each

month could be fulfilled by payments to third parties with

respect to a residence which petitioner owned.

     More importantly, however, the amounts of the cash payments

reveal their nature.   Petitioner’s obligation to pay spousal
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support, which ceased at an undetermined time in 1995, was in the

monthly amount of $4,373.   From January through June, petitioner

was under an obligation to make child support payments of $2,007

per month.   In each of those months except January, his cash

payment to Ms. Feriante was $2,000.       From July through December,

petitioner was under an obligation to make child support payments

of $1,800 per month.   In each of these months, his cash payment

to Ms. Feriante was $1,800.   It is clear that these payments were

child support.   The sole exception is petitioner’s payment of

$3,500 in January.   However, respondent has already allowed

petitioners a deduction of $1,500, which is the amount in excess

of petitioner’s child support payment.

     Reviewed and adopted as the report of the Small Tax Case

Division.

     To reflect the foregoing,

                                         Decision will be entered

                                 for respondent.
