                  T.C. Summary Opinion 2006-80



                     UNITED STATES TAX COURT



             JOSEPH ORLANDO BECKFORD, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 906-05S.                Filed May 16, 2006.


     Joseph Orlando Beckford, pro se.

     Vivian N. Rodriguez, for respondent.



     DEAN, 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.    Unless otherwise

indicated, subsequent section references are to the Internal

Revenue Code as in effect for the year at issue, and all Rule

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

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 2003 a deficiency in petitioner’s

Federal income tax of $2,943.   The issues for decision are

whether petitioner is entitled to:      (1) A dependency exemption

deduction for his niece, (2) an earned income credit, (3) a child

tax credit, and (4) an additional child tax credit.

                            Background

     The stipulation of facts and exhibits received into evidence

are incorporated herein by reference.      At the time the petition

in this case was filed, petitioner resided in Miami, Florida.

     During 2003, petitioner was 24 years old.      Petitioner lived

in a house with his mother Thelma Blake (Ms. Blake), his brother,

and his niece TW.1   TW is the daughter of petitioner’s sister.

At the time, TW was 7 years old.

     Petitioner was employed as a computer repair technician by

Sygnetics, Inc. and Alienware Corp. in 2003.      Ms. Blake was

employed in 2003, and she earned approximately $35,000 to $40,000

that year.

     Petitioner filed a Form 1040, U.S. Individual Income Tax

Return, for 2003, reporting wages of $11,132 and adjusted gross

income of $11,132.   Respondent issued to petitioner a statutory

notice of deficiency determining that petitioner is not entitled

to a dependency exemption deduction for TW, an earned income




     1
      The Court will refer to the minor child by her initials.
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credit, a child tax credit, or an additional child tax credit,

because he failed to substantiate his claims.

                              Discussion

     The Commissioner’s determinations are presumed correct, and

generally taxpayers bear the burden of proving otherwise.2      Rule

142(a)(1); Welch v. Helvering, 290 U.S. 111, 115 (1933).

Dependency Exemption

     Petitioner claimed a dependency exemption for TW for 2003.

Respondent disallowed the deduction contending that petitioner

has failed to provide any substantiation that he provided more

than half of TW’s support during 2003.

     Section 151(c)(1) allows a taxpayer to claim an exemption

deduction for each qualifying dependent.    A daughter of a sister

of the taxpayer is considered a “dependent” so long as the

child’s gross income for the calendar year in which the taxable

year of the taxpayer begins is less than the exemption amount,

and more than half the child’s support for the taxable year was

received from the taxpayer.    Secs. 151(c)(1)(A), 152(a)(6).

     Although petitioner contends that he took care of TW in 2003

and that he provided more than half of TW’s support, he has

failed to offer any records to corroborate his testimony.


     2
      Petitioner has not raised the issue of sec. 7491(a), which
shifts the burden of proof to the Commissioner in certain
situations. This Court concludes that sec. 7491 does not apply
because petitioner has not produced any evidence that establishes
the preconditions for its application.
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Petitioner explained that he lacked documentation because he

generally paid TW’s expenses in cash.

     Petitioner and Ms. Blake shared the expenses for support of

the household.    According to petitioner, he “helped with” paying

the mortgage, the utilities, and “most of everything”.   The

record is unclear as to the amount of expenses paid for the

household.   It is also unclear how petitioner and Ms. Blake

allocated the expenses between them.    It appears that petitioner

contributed to the household expenses whenever he was able and

that he did not pay a set amount to Ms. Blake.   The Court is

unable to determine how much of the expenses paid by petitioner

related to TW.

     TW attended private school and her tuition was approximately

$287 per month.   Ms. Blake testified that both she and petitioner

together paid TW’s tuition.   Petitioner, however, failed to offer

any records or receipts from the school to show the amount of

TW’s expenses or how those expenses were paid and allocated.

     Ms. Blake, by her own admission, earned about three times as

much as petitioner in 2003.   The Court concludes that petitioner

has not offered sufficient evidence to show that he provided more

than half of TW’s support in 2003.
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Earned Income Credit

     Respondent disallowed the earned income credit, contending

that petitioner has failed to substantiate that he treated TW as

his own child.

     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 order for a niece to meet the relationship requirement of

section 32(c)(3)(B), the taxpayer must show that he cared for the

niece as his own child.   Sec. 32(c)(3)(B)(i)(II).

     Petitioner has not offered any evidence to show that he

cared for TW as if she were his own daughter.   Even if petitioner

did provide some financial support for TW, it is insufficient to
                                 - 6 -

show that he cared for TW as his own child in 2003.     This Court

has indicated that merely contributing financially to the support

of an individual does not rise to the level of caring for the

individual as one’s own child.    See Mares v. Commissioner, T.C.

Memo. 2001-216; Smith v. Commissioner, T.C. Memo. 1997-544.

     Although petitioner is not eligible to claim an earned

income credit under section 32(c)(1)(A)(i) for a qualifying

child, he may be an “eligible individual” under section

32(c)(1)(A)(ii) even if he does not have any qualifying children.

For 2003, a taxpayer is eligible under this subsection only if

his adjusted gross income was less than $11,230.     Rev. Proc.

2002-70, 2002-2 C.B. 845.    Petitioner’s adjusted gross income was

$11,132.

     Accordingly, petitioner is eligible for an earned income

credit.

Child Tax Credit and Additional Child Tax Credit

     For 2003, petitioner claimed a child tax credit of $29 and

an additional child tax credit of $63 with TW as the qualifying

child.     Respondent determined that petitioner is not entitled to

either.

     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).      A “qualifying child” means

an individual with respect to whom the taxpayer is allowed a
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deduction under section 151, who has not attained the age of 17

as of the close of the taxable year and who bears a relationship

to the taxpayer as prescribed by section 32(c)(3)(B).   Sec.

24(c)(1).

     Since petitioner is not allowed a deduction with respect to

TW as a dependent under section 151, TW is not qualifying child.

In the absence of a qualifying child in 2003, petitioner is not

entitled to claim a 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.   See 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.   See sec.

26(a).
                                 - 8 -

     If the child tax credit exceeds the taxpayer’s Federal

income tax 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).   For 2003, the additional child tax

credit is allowed in an amount that is the lesser of the

remaining child tax credit available or 10 percent of the amount

by which the taxpayer’s earned income exceeds $10,500.       Sec.

24(d)(1)(A) and (B), (d)(3); Rev. Proc. 2002-70, sec. 3.04, 2002-

2 C.B. at 847.   The refundable and nonrefundable portions of the

child tax credit cannot exceed the total allowable amount of the

credit.

     Petitioner is not entitled to claim an additional child tax

credit because he did not qualify for a child tax credit.

     Reviewed and adopted as the report of the Small Tax Case

Division.

     To reflect the foregoing,

                                              Decision will be entered

                                         under Rule 155.
