                  T.C. Summary Opinion 2003-121



                     UNITED STATES TAX COURT



               BRUCE EDWARD KENNEDY, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 10013-01S.             Filed August 27, 2003.



     Bruce Edward Kennedy, pro se.

     Richard J. Hassebrock, 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


     1
          Unless otherwise indicated, subsequent section
references are to the Internal Revenue Code in effect for the
year at issue. Rule references are to the Tax Court Rules of
Practice and Procedure.
                               - 2 -


be cited as authority.

     Respondent determined a deficiency of $4,529 in petitioner’s

Federal income tax for 2000.   The sole issue for decision is

whether petitioner is entitled to an earned income credit under

section 32(a), based on whether his daughters, Bianca and Alexa,

are qualifying children under section 32(c)(3).   More

specifically, the question is whether the daughters had the same

principal place of abode with petitioner for more than one-half

of the taxable year under section 32(c)(3)(A)(ii).2

     Some of the facts were stipulated.   Those facts, with the

exhibits annexed thereto, are so found and are made part hereof.

Petitioner’s legal residence at the time the petition was filed

was Cincinnati, Ohio.

     Petitioner’s son, Kyle W. Kennedy (Kyle), was born in 1985.

     2
          On his Federal income tax return for 2000, petitioner
claimed one dependency exemption for his son, Kyle Kennedy, and
claimed the earned income credit based on two qualifying
children: the son, Kyle Kennedy, and a daughter, Bianca Kennedy.
Petitioner also claimed head-of-household filing status. In the
notice of deficiency, respondent disallowed the dependency
exemption for Kyle Kennedy, disallowed the earned income credit,
and determined that petitioner’s filing status was single rather
than head-of-household. At trial, petitioner conceded his filing
status was single and conceded that his son, Kyle, was not a
qualifying child for purposes of the earned income credit.
However, at trial, petitioner claimed that Bianca and another
daughter, Alexa, were qualifying children for purposes of the
earned income credit. Respondent, at trial, conceded that
petitioner was entitled to the dependency exemption for Kyle and
further conceded petitioner’s entitlement to a child tax credit
under sec. 24 with respect to Kyle (even though petitioner had
not claimed a child tax credit on his 2000 return).
                                - 3 -


Kyle’s mother is Lisa Marcum, whom petitioner never married.

Petitioner also has two daughters, Bianca Kennedy (Bianca) and

Alexa Kennedy (Alexa), who were 9 and 7 years old, respectively,

during the year at issue.    Bianca and Alexa’s mother is Ayse

Kennedy (Ms. Kennedy).   Petitioner was married to Ayse Kennedy,

but the two divorced prior to the year at issue.    Petitioner and

Ms. Kennedy shared custody of their daughters under a shared

parenting arrangement.   However, no divorce decree or custodial

document was introduced into evidence.

     During the year at issue, petitioner was self-employed in

the catering business.   He lived in a home owned by his fiancee,

Michele Zorb, and contributed toward the expenses of maintaining

the home.   Ms. Kennedy was an overseas flight attendant for

American Airlines.

     In her occupation as a flight attendant, Ms. Kennedy

traveled frequently.   Her travel schedule changed from month to

month.   She often flew to South America on flights originating

from airports in New York.    Her “regular” route was Rio de

Janeiro, Brazil.   She also worked on flights to and from Sao

Paolo, London, Bermuda, and other international destinations.     To

report for work from her home in Ohio, she would travel on

standby status on various airlines to New York.    She engaged in

the same practice, in reverse, coming home from her flights.     As

a privilege of being a flight attendant, she was allowed this so-
                               - 4 -


called “nonrevenue travel” at no expense on American Airlines and

for a nominal fee on other carriers.   Her commuting was

occasionally subject to flight delays due to weather, air

traffic, available seats, and other factors.   Ms. Kennedy also

utilized her nonrevenue ticket privilege to travel recreationally

and to purchase airline tickets for friends and family members.

     As a general practice, Bianca and Alexa lived with their

mother when she was not working; when Ms. Kennedy was working,

they lived with petitioner.   Petitioner and Ms. Kennedy observed

this general practice as “the best thing for the kids.”    The

arrangement also afforded Ms. Kennedy the flexibility she needed

in her employment.   Because Ms. Kennedy’s work required overnight

travel, Bianca and Alexa often spent several consecutive days

during each month, including significant periods during the

summer and on holidays, with petitioner or in his care.

     There were exceptions to the girls’ general practice of

living with their father when Ms. Kennedy was working and with

their mother when she was home.   On occasion, the girls spent

days or portions of days with petitioner, petitioner’s parents,

or other relatives even though Ms. Kennedy was not working, or

with relatives other than petitioner when Ms. Kennedy was

working.   If petitioner was out of town when Ms. Kennedy left for

a trip, the girls stayed at petitioner’s home, where Ms. Zorb

cared for them.   Petitioner’s parents lived in Aberdeen, Ohio,
                                - 5 -


approximately 60 miles from petitioner.

     Petitioner owned a 1933 40-foot trawler, which he described

as “an old wooden boat.”    The boat had sleeping quarters, and

petitioner took the boat on the Ohio River for days at a time

during the year at issue.    Occasionally, his daughters joined him

in spending time on the boat.    Petitioner kept a boat log in the

use of his boat.

     As indicated supra note 2, on his 2000 return, petitioner

claimed an earned income credit with respect to Kyle and Bianca.

He did not claim Alexa as a qualifying child for this credit.     In

the notice of deficiency, respondent disallowed the earned income

credit.   At trial, petitioner contended he was entitled to the

earned income credit with respect to Bianca and Alexa, rather

than Bianca and Kyle, as the qualifying children.

     Section 32(a) provides for an earned income credit in the

case of an eligible individual.    Section 32(c)(1)(A), in

pertinent part, defines an "eligible individual" as an individual

who has a qualifying child for the taxable year.     Sec.

32(c)(1)(A)(i).    A qualifying child is one who satisfies a

relationship test, a residency test, an age test, and an

identification requirement.    See sec. 32(c)(3).   Respondent

conceded that the relationship, age, and identification

requirements have been met with respect to petitioner’s

daughters.   Respondent’s position is that the residency test has
                                 - 6 -


not been met, thus placing that question as the sole issue for

the Court.3

      The residency test requires that a qualifying child have

“the same principal place of abode as the taxpayer for more than

one-half” of the taxable year.    Sec. 32(c)(3)(A)(ii).     Principal

place of abode is not defined in the provisions relating to the

earned income credit.   However, the provisions dealing with head-

of-household filing status are analogous.       H. Conf. Rept. 101-

964, at 1037 (1990), 1991-2 C.B. 560, 564; sec. 2(b)(1); sec.

1.2-2(b) and (c), Income Tax Regs.       In determining whether a

household actually constitutes the home of the taxpayer or a

principal place of abode of another person, the taxpayer and such

other person “must occupy the household”.       Sec. 1.2-2(c)(1),

Income Tax Regs.   However, temporary absences from the household

by the other person due to “special circumstances” are permitted.

Id.

      With respect to special circumstances, the applicable

regulation provides:


      A nonpermanent failure to occupy the common abode by reason
      of illness, education, business, vacation, military service,
      or a custody agreement under which a child or stepchild is
      absent for less than six months in the taxable year of the
      taxpayer, shall be considered temporary absence due to


      3
          The Court decides this case without regard to the
burden of proof. Sec. 7491(a)(1); Rule 142(a); Higbee v.
Commissioner, 116 T.C. 438 (2001).
                                 - 7 -


      special circumstances. Such absence will not prevent the
      taxpayer from being considered as maintaining a household if
      (i) it is reasonable to assume that the taxpayer or such
      other person will return to the household, and (ii) the
      taxpayer continues to maintain such household or a
      substantially equivalent household in anticipation of such
      return.


Id.   The inquiry is fact-specific; to be considered a temporary

absence due to special circumstances, the evidence must establish

that the absence was in fact temporary within the meaning of the

regulation.   Cf. Ruff v. Commissioner, 52 T.C. 576, 579 (1969);

Wells v. Commissioner, T.C. Memo. 1986-516.    Moreover, the

special circumstances or necessity of the absence must be a type

intended by the statute.     Manning v. Commissioner, 72 T.C. 838,

840 (1979).   Special circumstances have been found to exist, and

a taxpayer to be qualified for head-of-household status, where a

child was away at a school but returned to reside with the parent

when school was not in session.     Blair v. Commissioner, 63 T.C.

214 (1975); Byrd v. Commissioner, T.C. Memo. 1986-385.

      Both petitioner and Ms. Kennedy provided a place of abode,

or home, for Bianca and Alexa.    Since 2000 was a leap year, there

were 366 days in that year.    Whoever provided the girls a home

for more than 183 days, therefore, provided their principal place

of abode for purposes of the earned income credit.    The parties

stipulated to 122 days that neither Alexa nor Bianca Kennedy

resided with their mother.    However, respondent urged the Court
                                 - 8 -


to disregard a portion of that stipulation.    Rule 91(e) (the

Court has broad discretion to disregard stipulations where

contrary to facts disclosed by the record); Estate of Eddy v.

Commissioner, 115 T.C. 135, 137 n.2 (2000).    At trial, respondent

contended that the girls resided with Ms. Kennedy for 199 days

during the 2000 tax year.   Petitioner contended that the girls

lived with him for at least 191 days during 2000.4

     The documentary evidence introduced at trial to establish

where Bianca and Alexa resided during 2000 included the

following:   (1) Ms. Kennedy’s contemporaneous calendar with

handwritten notations for the year at issue, which recorded when

her daughters resided with her, her work schedule, and other

personal events, but with a number of items redacted; (2)

American Airlines records indicating Ms. Kennedy’s travel

schedule, flights on which she worked, her nonrevenue travel

purchases, and layovers; (3) a contemporaneous calendar kept by

petitioner’s mother, Alice Kennedy, reflecting visits from Bianca

and Alexa and other personal events; and (4) a contemporaneous

boat log recording petitioner’s use of his trawler, including

passenger references.   Petitioner himself did not keep a year-

long contemporaneous calendar.    On a number of dates in 2000,

entries in these various contemporaneous records conflicted with


     4
          On brief, petitioner asserted that the girls lived with
him for 196 days during that year.
                                - 9 -


respect to the whereabouts of the girls.    Some entries were

conceded to be erroneous.    No one from American Airlines

testified explaining and clarifying the airline records; thus,

these records were of limited usefulness to the Court.5

     Like the documentary evidence, and as might be expected in a

case of this nature, the testimony at trial was conflicting.

Three witnesses testified:    Ms. Kennedy, as to the girls’

whereabouts for each day in 2000; petitioner, as to certain dates

that were in dispute; and petitioner’s mother, Alice Kennedy, as

to her own calendar.   When compared with the documentary

evidence, the Court finds some of the testimony to be inaccurate.

The Court considers the witnesses to have been of relatively

equal credibility.

     Rather than relying on the stipulation or any single

evidentiary source, the Court has considered the entire record as

to the girls’ presence on each day in 2000.    As to each contested

period, the Court has reached a conclusion based on what the

Court finds to be supported by a preponderance of the evidence.

In calculating the days spent with petitioner, the Court


     5
          Petitioner attempted to rely on the records of Ms.
Kennedy’s nonrevenue ticket purchase to establish that she was
traveling on certain contested dates. However, as respondent
pointed out, Ms. Kennedy purchased such tickets for family
members and friends as well as for herself; thus, the records do
not definitively establish her whereabouts. At best, the
nonrevenue ticket records help to corroborate the times Ms.
Kennedy was working as a flight attendant.
                               - 10 -


considered such days that the girls spent with petitioner’s

parents and Ms. Zorb to count in petitioner’s favor, as temporary

absences within the meaning of the regulations.    Sec. 1.2-

2(c)(1), Income Tax Regs.    On days that the girls spent part of

their time with both parents, petitioner and Ms. Kennedy were

each credited with one-half day, an approach sanctioned by both

petitioner and respondent.

     Despite these allowances, on this record, the Court holds

that Bianca and Alexa Kennedy did not have the same principal

place of abode with petitioner for more than one-half of the

year.    As between petitioner and Ms. Kennedy, the number of days

each spent with their daughters was quite close.    Although

petitioner did provide a place of abode for Bianca and Alexa for

a significant portion of 2000, that time period, in the Court’s

best judgment, did not exceed 183 days for that year.    Therefore,

the Court holds that the two girls were not qualifying children

for purposes of section 32(a).    Respondent is sustained on this

issue.

     Reviewed and adopted as the report of the Small Tax Case

Division.



                                          Decision will be entered

                                     under Rule 155.
