                                            ROBERT D. PACKARD, PETITIONER v. COMMISSIONER                                    OF
                                                    INTERNAL REVENUE, RESPONDENT
                                                    Docket No. 565–11.                      Filed November 5, 2012.

                                                 P married W on Nov. 22, 2008, but they continued to reside
                                               in separate residences until they purchased the subject resi-
                                               dence together on Dec. 1, 2009. Before purchasing the subject
                                               residence, W owned a principal residence where she resided
                                               for more than five consecutive years during the eight years
                                               before Dec. 1, 2009. P had no present ownership interest in
                                               a principal residence during the three-year period ending on
                                               Dec. 1, 2009. Held: Because W qualifies for the first-time
                                               homebuyer credit under the exception for longtime residents
                                               of the same principal residence pursuant to I.R.C. sec. 36(c)(6)
                                               and because P qualifies for the first-time homebuyer credit
                                               pursuant to I.R.C. sec. 36(c)(1), P and W are entitled to the

                                     390




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                                     (390)                         PACKARD v. COMMISSIONER                                       391


                                               first-time homebuyer credit of $6,500 as limited by I.R.C. sec.
                                               36(b)(1)(D).

                                           Robert D. Packard, pro se.
                                           Christopher A. Pavilonis, for respondent.
                                                                                  OPINION

                                        WELLS, Judge: This case is before the Court on respond-
                                     ent’s motion for summary judgment pursuant to Rule 121. 1
                                     The issue we must decide is whether petitioner and his wife
                                     are entitled to the first-time homebuyer credit on their joint
                                     2009 return where individually petitioner would have been
                                     entitled to the first-time homebuyer credit pursuant to sec-
                                     tion 36(c)(1) and his wife would have been entitled to the
                                     first-time homebuyer credit pursuant to the exception pro-
                                     vided in section 36(c)(6) for longtime residents of the same
                                     principal residence.

                                                                               Background
                                       The parties stipulated all of the relevant facts. At the time
                                     he filed his petition, petitioner was a resident of Florida.
                                       Petitioner married Marianna Packard (formerly Marianna
                                     Kanehl) on November 22, 2008. After their marriage, they
                                     continued to reside in separate residences until they pur-
                                     chased a house together in Tarpon Springs, Florida, on
                                     December 1, 2009 (subject residence). Before purchasing the
                                     subject residence, Mrs. Packard owned and resided in a prin-
                                     cipal residence in Clearwater, Florida (prior residence), from
                                     April 1, 2004, until November 17, 2009. Before purchasing
                                     the subject residence with Mrs. Packard, petitioner rented a
                                     dwelling in Tarpon Springs, Florida. Petitioner had no
                                     present ownership interest in a principal residence during
                                     the three years before December 1, 2009.
                                       Petitioner and Mrs. Packard purchased the subject resi-
                                     dence for $203,500. When they filed their 2009 income tax
                                     return, they selected the status ‘‘married filing jointly’’ and
                                     claimed a $6,500 first-time homebuyer credit on the basis of
                                     the exception provided in section 36(c)(6). Respondent deter-
                                     mined that petitioner was not entitled to the first-time home-
                                     buyer credit. Petitioner timely filed his petition in this Court.
                                      1 Unless otherwise indicated, section references are to the Internal Revenue Code of 1986, as

                                     amended, and Rule references are to the Tax Court Rules of Practice and Procedure.




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                                     392                 139 UNITED STATES TAX COURT REPORTS                                    (390)


                                                                                Discussion
                                        Summary judgment is intended to expedite litigation and
                                     avoid unnecessary and expensive trials and may be granted
                                     where there is no genuine dispute of material fact and a deci-
                                     sion may be rendered as a matter of law. Rule 121(a) and (b);
                                     Fla. Peach Corp. v. Commissioner, 90 T.C. 678, 681 (1988).
                                     The moving party bears the burden of proving that there is
                                     no genuine dispute of material fact, and factual inferences
                                     are viewed in the light most favorable to the nonmoving
                                     party. Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520
                                     (1992), aff ’d, 17 F.3d 965 (7th Cir. 1994). However, the party
                                     opposing summary judgment must set forth specific facts
                                     that show a genuine dispute of material fact exists and may
                                     not rely merely on allegations or denials in the pleadings.
                                     Rule 121(d). Summary judgment is appropriate in the instant
                                     case because the parties agree on all material facts and the
                                     only issue we must decide is one of law. Consequently, the
                                     issue is ripe for summary adjudication.
                                        Section 36(a) allows ‘‘an individual who is a first-time
                                     homebuyer of a principal residence in the United States’’ a
                                     tax credit for the year the residence is purchased. Section
                                     36(c)(1) defines a ‘‘first-time homebuyer’’ as ‘‘any individual
                                     if such individual (and if married, such individual’s spouse)
                                     had no present ownership interest in a principal residence
                                     during the 3-year period ending on the date of the purchase
                                     of the principal residence to which this section applies.’’ The
                                     Worker, Homeownership, and Business Assistance Act of
                                     2009, Pub. L. No. 111–92, sec. 11(b), 123 Stat. at 2989,
                                     amended section 36(c) by adding a new paragraph (6), which
                                     provides:
                                     EXCEPTION FOR LONG-TIME RESIDENTS OF SAME PRINCIPAL RESIDENCE.—In
                                     the case of an individual (and, if married, such individual’s spouse) who
                                     has owned and used the same residence as such individual’s principal resi-
                                     dence for any 5-consecutive-year period during the 8-year period ending on
                                     the date of the purchase of a subsequent principal residence, such indi-
                                     vidual shall be treated as a first-time homebuyer for purposes of this sec-
                                     tion with respect to the purchase of such subsequent residence.

                                     Before the addition of paragraph (6) to section 36(c), the
                                     first-time homebuyer credit was limited to individuals who
                                     had no present ownership interest in a principal residence
                                     during the three-year period ending on the date of purchase




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                                     (390)                         PACKARD v. COMMISSIONER                                       393


                                     of the principal residence for which the credit is claimed
                                     (three-year period). Married couples could qualify for the
                                     credit only if neither spouse had a present ownership interest
                                     in a principal residence during the three-year period. Section
                                     36(c)(6) expanded the scope of the first-time homebuyer
                                     credit by making it available to individuals who have owned
                                     and lived in the same residence for at least five consecutive
                                     years during the eight years before purchasing a new prin-
                                     cipal residence.
                                        We must decide the relationship between paragraph (1)
                                     and paragraph (6) of section 36(c). Specifically, we must
                                     decide whether the exception provided pursuant to para-
                                     graph (6) requires that, for a married couple, both husband
                                     and wife must co-own and reside together at the same resi-
                                     dence for the five-consecutive-year period during the eight-
                                     year period ending on the date of purchase of the new resi-
                                     dence (five-consecutive-year period), or whether a married
                                     couple may also qualify for the exception pursuant to para-
                                     graph (6) if one spouse qualifies for the exception pursuant
                                     to paragraph (6) and the other qualifies as a first-time home-
                                     buyer pursuant to paragraph (1). The issue we are asked to
                                     decide is one of first impression.
                                        Respondent contends that paragraph (6) requires that both
                                     husband and wife own and reside together in the same resi-
                                     dence for the five-consecutive-year period. Respondent con-
                                     cedes that Mrs. Packard would be considered a first-time
                                     homebuyer pursuant to paragraph (6) but for the fact that
                                     petitioner did not co-own and reside with her in her prior
                                     residence      during    the    five-consecutive-year   period.
                                     Respondent also concedes that petitioner would be a first-
                                     time homebuyer pursuant to paragraph (1) but for the fact
                                     that Mrs. Packard owned the prior residence. Respondent
                                     contends that, because petitioner resided elsewhere during
                                     the five-consecutive-year period and did not co-own the prior
                                     residence, petitioner and Mrs. Packard are not entitled to the
                                     first-time homebuyer credit. We disagree.
                                        Paragraph (6) operates to expand the scope of the first-
                                     time homebuyer credit by treating an individual who has
                                     owned and resided in the same residence for the five-
                                     consecutive-year period as if that individual were a first-time
                                     homebuyer for purposes of section 36. By its terms, it pro-
                                     vides an exception to the definition of first-time homebuyer




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                                     394                 139 UNITED STATES TAX COURT REPORTS                                        (390)


                                     pursuant to section 36(c), a definition that is provided in
                                     paragraph (1). 2 In other words, the exception pursuant to
                                     paragraph (6) expands the definition of who qualifies as a
                                     first-time homebuyer pursuant to paragraph (1).
                                        It is a well-established rule of statutory construction that
                                     a statute is to be construed so as to give effect to its plain
                                     and ordinary meaning unless to do so would produce absurd
                                     or futile results. United States v. Am. Trucking Ass’ns, Inc.,
                                     310 U.S. 534, 543–544 (1940); Colestock v. Commissioner, 102
                                     T.C. 380, 387 (1994). As the Supreme Court has explained:
                                     There is, of course, no more persuasive evidence of the purpose of a statute
                                     than the words by which the legislature undertook to give expression to
                                     its wishes. Often these words are sufficient in and of themselves to deter-
                                     mine the purpose of the legislation. In such cases we have followed their
                                     plain meaning. When that meaning has led to absurd or futile results,
                                     however, this Court has looked beyond the words to the purpose of the act.
                                     Frequently, however, even when the plain meaning did not produce absurd
                                     results but merely an unreasonable one ‘‘plainly at variance with the
                                     policy of the legislation as a whole’’ this Court has followed that purpose,
                                     rather than the literal words. * * * [Am. Trucking Ass’ns, Inc., 310 U.S.
                                     at 543 (fn. refs. omitted) (quoting Ozawa v. United States, 260 U.S. 178,
                                     194 (1922)).]

                                     We do not agree with respondent that the plain and ordinary
                                     meaning of the definition of first-time homebuyer pursuant
                                     to paragraph (1) and the exception pursuant to paragraph (6)
                                     require that in order to qualify as first-time homebuyers,
                                     both spouses must qualify under the same paragraph. How-
                                     ever, even if the statute could be read as respondent con-
                                     tends, such a result would be absurd.
                                        Both paragraph (1) and paragraph (6) are intended to
                                     define a first-time homebuyer for the purpose of determining
                                     whether an individual is a first-time homebuyer entitled to
                                     claim a credit pursuant to section 36(a). When Congress first
                                     enacted section 36, it included the parenthetical phrase ‘‘and
                                     if married, such individual’s spouse’’ in the definition of first-
                                     time homebuyer provided in subsection (c)(1). Although the
                                       2 ‘‘Where * * * there is no collision involved, it is proper to consult both the section heading

                                     and the section’s content to come up with the statute’s clear and total meaning.’’ House v. Com-
                                     missioner, 453 F.2d 982, 987 (5th Cir. 1972), vacating T.C. Memo. 1970–125; see also United
                                     States v. Fisher, 6 U.S. (2 Cranch) 358, 386 (1805) (‘‘It is undoubtedly a well established prin-
                                     ciple in the exposition of statutes, that every part is to be considered, and the intention of the
                                     legislature to be extracted from the whole.’’); cf. sec. 7806(b) (‘‘No inference, implication, or pre-
                                     sumption of legislative construction shall be drawn or made by reason of the location or group-
                                     ing of any particular section or provision or portion of this title[.]’’).




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                                     (390)                         PACKARD v. COMMISSIONER                                       395


                                     legislative history does not explain the rationale for the
                                     inclusion of the parenthetical phrase, it is clear that Con-
                                     gress wanted to restrict the first-time homebuyer credit to
                                     only those married couples where both spouses qualify as
                                     first-time homebuyers. When Congress amended section 36(c)
                                     to add an exception to the definition of first-time homebuyer
                                     that would include longtime residents of the same principal
                                     residence, it presumably also sought to restrict the first-time
                                     homebuyer credit to only those married couples where both
                                     spouses qualify as first-time homebuyers, and it therefore
                                     borrowed the same parenthetical phrase from section
                                     36(c)(1). However, we cannot believe that Congress intended
                                     to restrict the first-time homebuyer credit to only those mar-
                                     ried couples where both spouses qualify under the same
                                     paragraph of section 36(c).
                                        Individually, petitioner and Mrs. Packard each would be
                                     entitled to the first-time homebuyer credit. As respondent
                                     has conceded, Mrs. Packard qualifies for the exception pursu-
                                     ant to paragraph (6). Although petitioner fails to qualify for
                                     the exception pursuant to paragraph (6), petitioner qualifies
                                     as a first-time homebuyer pursuant to paragraph (1) on
                                     account of his having had no present ownership interest in
                                     a principal residence during the three-year period ending on
                                     the date he purchased the subject residence. Because peti-
                                     tioner is a first-time homebuyer pursuant to paragraph (1)
                                     and because Mrs. Packard is treated as a first-time home-
                                     buyer pursuant to the exception provided in paragraph (6),
                                     both petitioner and Mrs. Packard are first-time homebuyers
                                     pursuant to section 36. Accordingly, we hold that petitioner
                                     and Mrs. Packard are entitled to the first-time homebuyer
                                     credit for their purchase of the subject residence. Because
                                     petitioner and Mrs. Packard would not have been entitled to
                                     the first-time homebuyer credit except for the addition of
                                     paragraph (6), they are limited to a credit of $6,500. See sec.
                                     36(b)(1)(D).
                                        In reaching these holdings, we have considered all the par-
                                     ties’ arguments, and, to the extent not addressed herein, we
                                     conclude that they are moot, irrelevant, or without merit.




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                                     396                 139 UNITED STATES TAX COURT REPORTS                                    (390)


                                           To reflect the foregoing,
                                                                     An appropriate order and decision will be
                                                                   entered.

                                                                               f




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