                  T.C. Summary Opinion 2006-20



                     UNITED STATES TAX COURT



                PATRICIA D. ARIAS, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 4976-05S.             Filed February 7, 2006.



     Patricia D. Arias, pro se.

     Kelly M. Davidson, for respondent.



     DEAN, Special Trial Judge:   This case was heard pursuant to

the provisions of section 7463 of the Internal Revenue Code.

Unless otherwise indicated, subsequent section references are to

the Internal Revenue Code as in effect for the year at issue.

The decision to be entered is not reviewable by any other court,

and this opinion should not be cited as authority.
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     Respondent determined for 2002 a deficiency in petitioner’s

Federal income tax of $4,783.

     The issue for decision is whether $30,000 received by

petitioner constitutes alimony or separate maintenance payments

includable in gross income for 2002.

     The stipulated facts and exhibits received in evidence are

incorporated herein by reference.   At the time the petition was

filed, petitioner resided in Flagstaff, Arizona.

                            Background

     A Consent Decree of Dissolution of Marriage (With Children)

(decree) was filed on April 30, 2001, in the Superior Court of

the State of Arizona, dissolving the marriage of petitioner and

Arnold S. Arias (Arias).   The decree ordered Arias to pay child

support of $1,000 a month and spousal maintenance of $2,500 a

month, both to be paid by wage assignment through the “Support

Clearinghouse” (Clearinghouse).   The decree provides that spousal

maintenance will terminate automatically upon petitioner’s death.

Petitioner and Arias have not resided in the same household since

2000.

     During 2002, petitioner received directly from Arias 24

payments of $1,750 by check for a total of $42,000.   Child

support payments represented $12,000 of the total and is not at

issue here.   Arias made the payments directly to petitioner; he

did not use a wage assignment through the Clearinghouse, and
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Clearinghouse records reflect no payments.      Each check to

petitioner, however, bore a notation that it was for spousal

maintenance and child support.

      Petitioner failed to report any amount as income from

alimony or separate maintenance on her Federal tax return for

2002.

                             Discussion

        As the issue for decision in this case is a question of

law, section 7491(a) does not apply.      Petitioner argues that

under Arizona State law $30,000 of the payments that she received

from Arias constitutes a “gift” to her and is not taxable.

Respondent contends that the $30,000 paid by Arias constitutes

income to petitioner as alimony or separate maintenance.

      For purposes of Federal income tax, under section 71(a),

“Gross income includes amounts received as alimony or separate

maintenance payments.”    Section 71(b)(1) defines the term

“alimony or separate maintenance payment” as any payment in cash

if:

           (A) such payment is received by (or on behalf of) a
      spouse under a divorce or separation instrument,

           (B) the divorce or separation instrument does not
      designate such payment as a payment which is not includible
      in gross income under this section and not allowable as a
      deduction under section 215,

           (C) in the case of an individual legally separated from
      his spouse under a decree of divorce or of separate
      maintenance, the payee spouse and the payor spouse are not
      members of the same household at the time such payment is
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     made, and

          (D) there is no liability to make any such payment for
     any period after the death of the payee spouse and there is
     no liability to make any payment (in cash or property) as a
     substitute for such payments after the death of the payee
     spouse.

The payments at issue, totaling $30,000 for the year 2002, meet

the specifications of section 71(a) and (b)(1).

     Petitioner, however, relies on two State statutes for her

position that the contested payments she received are gifts and

not income.   The first of these, Ariz. Rev. Stat. Ann. sec. 46-

441A (1998), established the Clearinghouse to receive, disburse

and monitor support payments.   Arizona Revised Statutes Annotated

sec. 46-441B (1998) requires all orders of support to direct

payment of support or maintenance through the Clearinghouse,

unless otherwise provided.   Arizona Revised Statutes Annotated

sec. 46-441H (1998) provides that payments made directly to a

person other than the Clearinghouse “shall not be credited

against the support obligation” unless direct payments were

ordered by the court or are made by agreement of the parties.     It

is clear that the decree in this case required Arias to make his

payments through the Clearinghouse and that he did not do so.

     The second statutory provision on which petitioner relies,

Ariz. Rev. Stat. Ann. sec. 25-510B (2000), states that “In any

proceeding under this chapter” (Chapter 5, Family Support

Duties), records of payments maintained by the Clearinghouse are
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prima facie evidence of payments made and disbursed and are

“rebuttable only by a specific evidentiary showing to the

contrary.”   Under this provision, when the State court is

considering matters under Chapter 5, Family Support Duties, for

State support purposes, Clearinghouse records are important

pieces of evidence.1

     The parties stipulated a copy of a document published by the

Arizona Supreme Court, Administrative Office Of The Courts,

Family Law Unit.    At page six of the document, it states that if

child support payments are not sent through the Clearinghouse,

“the court may consider those payments as ‘gifts’” and not as

child support.   For purposes of any payment dispute between

petitioner and Arias that may be brought to the attention of the

State court, petitioner may rely on State statutes.   The parties

agree that the payments at issue here, however, are not child

support payments.

     The question to be decided by this Court is whether

petitioner’s receipt from Arias of the $30,000, over and above

$12,000 of child support, is income to her for Federal income tax

purposes.    Under the Constitution, the laws of the United States

are the supreme law of the land that bind the judges in every

State, notwithstanding any State law to the contrary.   U.S.


     1
      Since Clearinghouse records are rebuttable by specific
contrary evidence, however, Arias’s canceled checks would be
specific evidence showing payment of his support obligations.
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Const. art. VI, cl. 2.    The decision of the Tax Court is to be

made under Federal law, the Internal Revenue Code; this is not a

proceeding under Chapter 5, Family Support Duties, under Arizona

State law.    The laws of a State cannot govern issues of Federal

tax law.    Commissioner v. Tower, 327 U.S. 280, 287-288 (1946);

First Natl. Bank of Omaha v. United States, 681 F.2d 534, 541 n.4

(8th Cir. 1982).

     It is true that section 102 excludes from gross income the

value of property received as a “gift”.   A gift in the statutory

sense, however, proceeds from a “detached and disinterested

generosity”, Commissioner v. Lo Bue, 351 U.S. 243, 246 (1956),

out of affection, respect, admiration, charity, or like impulses.

Robertson v. United States, 343 U.S. 711, 713-714 (1952).     The

most critical consideration is the transferor’s intent.      Bogardus

v. Commissioner, 302 U.S. 34, 43 (1937); see Commissioner v.

Duberstein, 363 U.S. 278, 285-286 (1960).   Because of the

acrimony between petitioner and Arias it is doubtful that the

payments proceeded from “detached and disinterested generosity”

out of Arias’s affection, respect, admiration, charity, or like

impulses.    Arias testified that his intent was to pay petitioner

spousal maintenance and child support.    The circumstances support

his testimony.

     The Court finds that $30,000 of the payments received by

petitioner from Arias in 2002 is includable in her gross income
                                 - 7 -

as alimony or separate maintenance payments under section 71.

     Reviewed and adopted as the report of the Small Tax Case

Division.

     To reflect the foregoing,


                                          Decision will be entered

                                     for respondent.
