                  T.C. Summary Opinion 2007-12



                     UNITED STATES TAX COURT



                  ISHMAEL TARIKH, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 11571-05S.              Filed January 18, 2007.


     Ishmael Tarikh, pro se.

     Catherine G. Chang, for respondent.



     COUVILLION, Special Trial Judge:    This case was heard

pursuant to section 7463 of the Internal Revenue Code in effect

at the time the petition was filed.1    The decision to be entered

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

be cited as authority.


     1
      Unless otherwise indicated, all subsequent section
references are to the Internal Revenue Code in effect for the
year at issue. All Rule references are to the Tax Court Rules of
Practice and Procedure.
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      Respondent determined a deficiency of $5,328 in petitioner’s

Federal income tax for the year 2003.

      The issues for decision are whether petitioner is entitled

to:   (1) Dependency exemption deductions for three children under

section 151; (2) head-of-household filing status under section

2(b); (3) an earned income credit under section 32(a); and (4) a

child tax credit and an additional child tax credit under section

24.

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

The stipulation of facts and the annexed exhibits are

incorporated herein by reference.    At the time the petition was

filed, petitioner resided in Alameda, California.

      During the year at issue, petitioner was director of a human

rights project in San Francisco, California.     The project

provided lawyer referral services to indigent people and an

advocacy service for victims of police misconduct and abuse.

Petitioner has a degree in political science, a master’s degree

in Afro-American studies, and a juris doctor degree.

      Petitioner is the father of three children who were born,

respectively, in 1994, 1996, and 2000.     Petitioner and the mother

of the three children never married, and they did not live

together during the year at issue.     The children lived with

petitioner for the first 7 months of 2003 (the year at issue) and

lived with their mother for the remainder of the year.     During
                                 - 3 -

the 5 months the children lived with their mother during 2003,

petitioner paid $300 to her for support of the children.

Petitioner provided no other support to the children, nor did

their mother provide any support to petitioner during the time

the children were with him.

     For the year at issue, 2003, petitioner and the children’s

mother both claimed the children as dependents on their

respective Federal income tax returns.   Petitioner filed his 2003

return as a head-of-household under section 2(b)(1) and claimed

the dependency exemption deductions for the three children, the

earned income credit under section 32(a), and the child tax

credit and the additional child tax credit under section 24.    In

the notice of deficiency, respondent disallowed the dependency

exemption deductions, petitioner’s head-of-household filing

status, the earned income credit, the child care credit, and the

additional child care credit.

     Deductions are a matter of legislative grace, and taxpayers

must maintain adequate records to substantiate the amounts of any

deductions or credits claimed.    Sec. 6001; INDOPCO, Inc. v.

Commissioner, 503 U.S. 79, 84 (1992); sec. 1.6001-1(a), Income

Tax Regs.   Taxpayers generally bear the burden of proving that
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the Commissioner’s determination is incorrect.    Rule 142(a);

Welch v. Helvering, 290 U.S. 111 (1933).2

     The first issue is whether petitioner is entitled to the

dependency exemption deductions for the three children for the

year at issue.

     Section 151(c) allows taxpayers to deduct an annual

exemption amount for each dependent, as defined in section 152.

Under section 152(a), the term “dependent” means certain

individuals over half of whose support was received from the

taxpayer during the taxable year in which such individuals are

claimed as dependents.   As relevant here, the term includes a son

or daughter of the taxpayer.    Sec. 152(a)(1).

     The basis upon which petitioner claims entitlement to the

dependency exemption deductions is that the children lived with

him for 7 months during the year, during which he was their sole

source of support, and, for the 5 months in which the children

lived with their mother, he paid the mother $300 to support the

children.   Thus, petitioner claims that, from a practical

standpoint, since the children were with him a greater portion of

the year at issue, he, logically, provided more than half of the

children’s support that year.


     2
      Under some circumstances, the burden of proof shifts to the
Commissioner under sec. 7491. That burden does not shift to
respondent because petitioner failed to maintain records and
comply with the requirements of substantiation as required by
sec. 7491(a)(2).
                               - 5 -

     Respondent has not challenged petitioner’s contention that

the children lived with him for 7 months during the year at

issue.   Section 152(e) provides a special support test in the

case of divorced parents or parents who have never been married.

See King v. Commissioner, 121 T.C. 245, 250 (2003).    Under

section 152(e), if both parents together provide over half of the

support of a child, the parent having custody of the child for

the greater portion of the taxable year is entitled to the

dependency exemption for such child.   The Court is satisfied that

petitioner and the children’s mother provided over half the

support for their children during the year at issue.   Because the

children resided with petitioner for 7 months, he had custody of

them for the greater portion of the year and, consequently, he

satisfies the requirements of section 152(e).   On the facts

presented at trial, the Court holds that petitioner is entitled

to the dependency exemption deductions for his three children.

     The second issue is whether petitioner is entitled to head-

of-household filing status for the year at issue.

     Section 2(b) provides generally that an individual shall be

considered a head-of-household if, among other requisites not

pertinent here, such individual maintains as his home a household

that constitutes for more than one-half of such taxable year the

principal place of abode, as a member of such household, of an

unmarried son or daughter of the taxpayer.   Petitioner satisfies
                                - 6 -

that requisite; consequently, he qualifies for head-of-household

filing status for the year at issue.    See sec. 2(b)(1)(A)(i).

     The third issue is petitioner’s claim to the earned income

credit of $2,815 under section 32.

     Section 32(a)(1) allows an eligible individual an earned

income credit against the individual’s income tax liability.

Section 32(a)(2) limits the credit allowed, and section 32(b)

prescribes different percentages and amounts used to calculate

the credit based on whether the eligible individual has no

qualifying children, one qualifying child, or two or more

qualifying children.

     To be eligible to claim an earned income credit with respect

to a qualifying child, a taxpayer must establish, inter alia,

that the child bears a relationship to the taxpayer prescribed by

section 32(c)(3)(B), that the child meets the age requirements of

section 32(c)(3)(C), and that the child shares the same principal

place of abode as the taxpayer for more than one-half of the

taxable year as prescribed by section 32(c)(3)(A)(ii).

     In the pretrial memorandum respondent filed at the trial of

this case, respondent argued:


     Generally, I.R.C. section 32(c)(3) defines four tests for
     “qualifying child” which pertain to 1) relationship, 2) age,
     3) identification (taxpayer identification number) of the
     child and 4) and abode requirement. On this issue
     Petitioner does not satisfy the abode requirement with
     respect to the residency of the claimed dependents during
     2003. In addition it has already been shown he failed to
                               - 7 -

     demonstrate that he provided more than 50% of the overall
     household expenses in order to be entitled to the dependency
     exemption for any of his dependents. Since he did not
     fulfill the abode requirement relative to the dependency
     exemptions and since he is not entitled to claim a
     dependency exemption for any of the minor children, he is
     not entitled to the earned income credit.


     Respondent’s statement with respect to the abode requirement

is in error because petitioner’s unchallenged testimony at trial

was that the children lived with him for 7 months during the year

at issue.   Under section 32(c)(1)(A)(ii), over 6 months of

sharing a place of abode with the taxpayer is necessary to

qualify for the earned income credit.   Moreover, there is no

support requirement under section 32, nor is it required that the

taxpayer be entitled to the dependency exemption deductions for

the children.   In response to respondent’s argument, quoted

above, that petitioner failed to establish that he provided more

than 50 percent of the overall household expenses relative to the

claimed dependency exemption deductions, the flush language of

section 2(b)(1) provides that an individual shall be considered

as maintaining a household if over half the cost of maintaining

the household during the taxable year is furnished by that

individual, a requirement which petitioner satisfied.

Petitioner, therefore, is sustained on this issue.

     The next issue is petitioner’s claim to the child tax credit

and the additional child tax credit under section 24.   In the

notice of deficiency, respondent disallowed both credits.
                               - 8 -

     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 to this case, a

qualifying child means an individual with respect to whom the

taxpayer is allowed a deduction under section 151.    Sec.

24(c)(1)(A).   Since petitioner is entitled to the dependency

exemption deductions under section 151, it follows he is entitled

to the child tax credit.

     The child tax credit is a nonrefundable personal credit that

was added to the Internal Revenue Code by the Taxpayer Relief Act

of 1997, Pub. L. 105-34, sec. 101(a), 111 Stat. 796, with a

provision for a refundable credit, the additional child tax

credit, for families with three or more children.    For taxable

years beginning after December 31, 2000, the additional child tax

credit provision was amended to remove the restriction that only

families with three or more children are entitled to claim the

credit.   Sec. 24(d)(1); Economic Growth and Tax Relief

Reconciliation Act of 2001, Pub. L. 107-16, sec. 201(c)(1), 115

Stat. 46.

     In the absence of other nonrefundable personal credits, a

taxpayer is allowed to claim a child tax credit in an amount that

is the lesser of the full child tax credit or the taxpayer’s

Federal income tax liability for the taxable year.    Sec. 26(a).

If the child tax credit exceeds the taxpayer’s Federal income tax
                               - 9 -

liability for the taxable year, a portion of the child tax credit

may be refundable as an additional child tax credit under section

24(d)(1).   The refundable and nonrefundable portions of the child

tax credit cannot exceed the total allowable amount of the

credit.

     Petitioner is entitled to the additional child tax credit

because he qualified for a child tax credit.     Accordingly,

petitioner’s claim to this credit is sustained.

     Reviewed and adopted as the report of the Small Tax Case

Division.



                                       Decision will be entered

                               for petitioner.
