                         T.C. Summary Opinion 2016-90



                        UNITED STATES TAX COURT



                     DANIEL BINNS, Petitioner v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



      Docket No. 1781-15S.                         Filed December 22, 2016.


      Daniel Binns, pro se.

      Evan K. Like, for respondent.



                              SUMMARY OPINION


      WHERRY, Judge: This case was heard pursuant to the provisions of

section 7463 of the Internal Revenue Code in effect when the petition was filed.1

Pursuant to section 7463(b), the decision to be entered is not reviewable by any


      1
        Unless otherwise indicated, section references are to the Internal Revenue
Code of 1986, as amended, in effect for the year in issue, and Rule references are
to the Tax Court Rules of Practice and Procedure.
                                         -2-

other court, and this opinion shall not be treated as precedent for any other case.

Respondent determined that petitioner has a deficiency of $4,271 in Federal

income tax for taxable year 2013. The issues for decision are whether petitioner is

entitled to: (1) dependency exemption deductions for Lisa Hinkle and a child with

the initials C.B.;2 (2) head of household filing status; (3) an earned income credit;

and (4) an additional child tax credit for the taxable year 2013.

                                     Background

      Petitioner, Daniel Binns, electronically filed a timely income tax return,

Form 1040, U.S. Individual Income Tax Return, for the taxable year 2013.

Petitioner filed that return as head of household and claimed (1) a dependency

exemption deduction for Lisa Hinkle and a child with initials C.B., (2) an earned

income tax credit, and (3) an additional child tax credit. Petitioner was a resident

of Ohio during all relevant times.

      Petitioner and Ms. Hinkle were never married, but they shared a residence

for some of the taxable year 2013. Petitioner was unable to reside with Ms. Hinkle

during all of 2013 because he was incarcerated at an Ohio correctional facility




      2
       It is the policy of this Court not to identify minors. We refer to minor
children by their initials. See Rule 27(a)(3).
                                         -3-

from January 16 to November 6, 2013.3 In March 2012 petitioner and Ms. Hinkle

rented an apartment on Ironwood Court in Columbus, Ohio, which served as their

home. Except for petitioner’s confinement period when he was absent from the

home, they remained there throughout 2013 until they moved to a new apartment

on January 14, 2014.

      Prior to his incarceration petitioner took great care to provide for Ms.

Hinkle and their child, C.B. (born in 2010). Petitioner worked for an event rental

business starting in March 2011 until he was incarcerated on January 16, 2013.

He paid January rent for their apartment and then pre-paid the $555 monthly rent

for the next six months (through July 2013) as he expected to be released from

incarceration at the end of July. After he filed his taxable year 2012 Federal

income tax return, he had his refund of $4,511 issued to a checking account

controlled by Hardin Hinkle, Ms. Hinkle’s uncle. The tax refund was then

dispersed to Ms. Hinkle by her uncle for her to use for bills, food, clothing, etc. for

herself and C.B.4 Petitioner also set up a budget plan with Columbia Gas of Ohio,



      3
       A judgment entry by the Court of Common Pleas Franklin County, Ohio,
Criminal Division, against petitioner Daniel Binns was filed on January 17, 2013,
with a sentence of four years’ incarceration.
      4
      The record is unclear as to whether Ms. Hinkle received the money as a
lump sum or her uncle, Mr. Hinkle, distributed it as she required funds.
                                         -4-

under which he paid a set amount of $40 per month for gas regardless of use. At

the end of the year Columbia Gas of Ohio billed petitioner an accrued balance to

reflect actual use or issued a credit for any overpayment. The electric bill for the

apartment was approximately $1,470 for the entire year. Individuals must apply

each year through the State of Ohio in order to be eligible for the budget plan. Ms.

Hinkle used the funds petitioner provided to pay $480 to the gas company and

$1,470 to the electric company during the taxable year 2013.

      During this period Ms. Hinkle did not work and stayed home with C.B.

Thus, neither petitioner nor Ms. Hinkle incurred any school or significant child

care expenses in 2013. When petitioner realized he would not be released in July

as he had previously thought, he contacted his landlord, Ms. Chan, with whom he

had rapport. Ms. Chan agreed to allow Ms. Hinkle (and C.B.) to remain in the

apartment until petitioner was released from prison when he would pay off or

work off any unpaid balance. Upon his release, petitioner worked as a handyman

in some of Ms. Chan’s other apartment units. He painted, patched, and did other

punch list work for these units. She credited an agreed amount for his work

against the rent owed. From his release on November 6, 2013, to the end of 2013,

he earned $11,000 from Ms. Chan which he reported on Schedule C, Profit or Loss

from Business, of his 2013 Form 1040.
                                        -5-

      Petitioner requested and submitted into evidence his 2011 and 2012

transcripts from the IRS, which showed that he claimed the earned income credit

for C.B. On his 2011 return, petitioner claimed C.B. as a dependent and filed as

single. Petitioner resided with C.B. for the entirety of 2011. On his 2012 return,

petitioner claimed C.B. and Ms. Hinkle as dependents and filed as head of

household. The 2012 transcript also shows a refund of $4,511 issued to petitioner.

The Court finds that the transcripts reflect a course of conduct showing that

petitioner provided for C.B.’s support during these years.

      Ms. Hinkle also received benefits from the Supplemental Nutrition

Assistance Program (SNAP), commonly referred to as food stamps, for most or all

of 2013. We take judicial notice5 of the U.S. Department of Agriculture, Food and

      5
        The Court will take judicial notice of the 2013 maximum benefit amounts
for the Supplemental Nutrition Assistance Program. See Fed. R. Evid. 201(c); see
also Denius v. Dunlap, 330 F. 3d 919, 926-927 (7th Cir. 2003); United States v.
Harris, 331 F. 2d 600, 601 (6th Cir. 1964). In general, the Court may take notice
of facts that are capable of accurate and ready determination by resort to sources
whose accuracy cannot reasonably be questioned. Fed. R. Evid. 201(b).
       As we do here, a court may take judicial notice of public records not subject
to reasonable dispute. See, e.g., Velazquez v. GMAC Mortg. Corp., 605 F. Supp.
2d 1049, 1057-1058 (C.D. Cal. 2008) (taking judicial notice of two deeds of trust
and a full reconveyance recorded in the Official Records of the Los Angeles
County, California, Recorder). Ample precedent exists for our reliance on
electronic versions of public records. See, e.g., Marshek v. Eichenlaub, 266 F.
App’x 392, 392-393 (6th Cir. 2008) (holding that the court could take judicial
notice of information on the Inmate Locator, maintained by the Federal Bureau of
                                                                       (continued...)
                                        -6-

Nutrition Service Web site, which indicates that for a household of two people, the

maximum monthly benefits were $367 per month for most of 2013. Food and

Nutrition Service, FY2013 Allotments and Deduction Information, (April 2,

2014), http://www.fns.usda.gov/snap/fy-2013-allotments-and-deduction-

information.

      Petitioner credibly testified that for 2013 he provided at least $18,000 of

support, and Ms. Hinkle relied on these funds, along with SNAP assistance, for

her and C.B.’s maintenance and well-being. Petitioner’s testimony indicated that

Ms. Hinkle’s parents likely provided some additional financial assistance to C.B.

and Ms. Hinkle for 2013 and that Ms. Hinkle’s parents may have claimed C.B. and

Ms. Hinkle as dependents on their 2013 tax return. Petitioner did not provide any

evidence with respect to the amount of support Ms. Hinkle’s parents provided or

by extension the total amount of support received by Ms. Hinkle during the

taxable year 2013.




      5
       (...continued)
Prisons, and accessed through the agency’s Web site); Denius, 330 F.3d at
926-927 (holding that District Court erred when it refused to take judicial notice
of information on an official Web site of a Federal agency that maintained medical
records on retired military personnel, the fact of which was appropriate for judicial
notice because it is not subject to reasonable dispute).
                                          -7-

         C.B. received medical care, during three healthcare appointments in

December 2013, but there is no indication that its cost was significant. The record

does not reveal how the exact costs of this care or these visits were paid for.

Nevertheless, petitioner paid the rent and utilities related to the apartment where

he, Ms. Hinkle, and C.B. resided for the 2013 year, and these amounts represented

more than one-half of the expenses incurred to maintain the household for the

year.

                                      Discussion

         As a general rule, the Commissioner’s determination of a taxpayer’s liability

is presumed correct, and the taxpayer bears the burden of proving that the

determination is improper. Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115

(1933). Deductions are a matter of legislative grace, and the taxpayer bears the

burden of proving that he is entitled to any claimed deductions. New Colonial Ice

Co. v. Helvering, 292 U.S. 435, 440 (1934). This includes the burden of

substantiation. Hradesky v. Commissioner, 65 T.C. 87, 89-90 (1975), aff’d per

curiam, 540 F.2d 821 (5th Cir. 1976). Although section 7491 may shift the burden

of proof to the Commissioner in specified circumstances, petitioner here has not

established that he meets the requisites under section 7491(a)(1) and (2) for such a

shift.
                                        -8-

I.    Dependency Exemptions

      Section 151 allows deductions for personal exemptions, including

exemptions for dependents of the taxpayers. See sec. 151(c). Section 152(a)

defines the term “dependent” as a qualifying child or qualifying relative. Section

152(c)(1) defines a qualifying child as an individual who: (1) bears a relationship

to the taxpayer described in section 152(c)(2); (2) has the same principal place of

abode as the taxpayer for more than one-half of such taxable year (residency test);

(3) meets certain age requirements; and (4) has not provided over one-half of such

individual’s own support for the calendar year in which the taxable year of the

taxpayer begins. For the taxable year 2013, C.B. meets the relationship, age, and

support requirements under section 152(c)(1)(A), (C), and (D) respectively, such

that C.B. could be the qualifying child of either petitioner or Ms. Hinkle.

      Generally, the residency test is satisfied if the individual has the same

principal place of abode as the taxpayer for more than one-half of the taxable year.

Sec. 152(c)(1)(B). C.B. satisfies the residency test with respect to Ms. Hinkle

because they were physically present in the same home during all of the taxable

year 2013.

      Petitioner was incarcerated from January 16 through November 6, and as a

result he did not physically reside in the same home with C.B. for more than six
                                        -9-

months during 2013. However, temporary absences due to special circumstances,

including absences due to illness, education, business, vacation, and military

service, are not treated as absences for purposes of determining whether the

residency test is satisfied. Sec. 1.152-1(b), Income Tax Regs.; see also Hein v.

Commissioner, 28 T.C. 826 (1957).

      Given the facts of this case and petitioner’s parole during the year, we find

that petitioner’s incarceration does not prevent him from satisfying the residency

requirement of section 152(c)(1)(B). See Rowe v. Commissioner, 128 T.C. 13

(2007) (interpreting similar language and finding that preconviction incarceration

was a temporary absence for purposes of calculating earned income credit).

Although petitioner could not be sure when he would be able to leave State

custody, he believed that it would be in only six months; and he made plans to

provide for his household in his absence and returned as soon as he was permitted

to. See Hein v. Commissioner, 28 T.C. at 834-835 (finding indefinite absence to

be temporary for purposes of establishing dependency exemption where absent

member of household would return as soon as she was able); Rev. Rul. 66-28,

1966-1 C.B. 31. For purposes of section 152(c)(1)(B), we will treat petitioner,

Ms. Hinkle, and C.B. as having the same principal place of abode for the entire

taxable year 2013.
                                        - 10 -

      Because C.B. satisfies all four tests under section 152(c)(1) for both

petitioner and Ms. Hinkle, we look to the tiebreaker rules under section 152(c)(4)

to determine which of them may claim C.B. as a qualifying child for taxable year

2013. Where both parents, who do not file a joint return, each reside with the

child for the same length of time during the year, section 152(c)(4)(ii) provides

that the child is treated as the qualifying child of the parent having the higher

adjusted gross income (AGI). The record establishes that Ms. Hinkle stayed at

home to provide care for C.B. during taxable year 2013 and did not have any

substantial adjusted gross income, while petitioner had an AGI of $10,233

(business income of $11,000 ! self-employment tax of $777 = $10,233).

Accordingly, C.B. is petitioner’s qualifying child for the taxable year 2013, and

petitioner is entitled to the corresponding dependency exemption.

      Petitioner is not, however, entitled to claim Ms. Hinkle as a qualifying

relative for the taxable year 2013. Section 152(d)(1) defines a qualifying relative

as an individual: (1) who bears a relationship to the taxpayer described in section

152(d)(2); (2) whose gross income for the calendar year is less than the exemption

amount (as defined in section 151(d)); (3) with respect to whom the taxpayer

provides over one-half of the individual’s support for the calendar year; and (4)
                                        - 11 -

who is not a qualifying child of the taxpayer, or of any other taxpayer, for the

taxable year.

      Petitioner and Ms. Hinkle were not married during 2013. However, section

152(d)(2)(H) provides that a qualified individual includes an individual, other than

the taxpayer’s spouse, who has the same principal place of abode as the taxpayer

and is a member of the taxpayer's household. In order to meet the definition of

qualifying relative under section 152(d)(2)(H), the regulations clarify that the

individual must live with the taxpayer for the entire taxable year, excluding

temporary absences. Sec. 1.152-1(b), Income Tax Regs. As discussed supra pp.

8-9, we have found that petitioner’s incarceration qualifies as a temporary absence

under the regulations. Respondent does not dispute that Ms. Hinkle had no

significant gross income and that she was not the qualifying child of any other

taxpayer.

      We turn next to whether petitioner has established that he provided more

than one-half of Ms. Hinkle’s support during the taxable year 2013. The

regulations provide that “[t]he term ‘support’ includes food, shelter, clothing,

medical and dental care, education, and the like.” Sec. 1.152-1(a)(2)(i), Income

Tax Regs. In determining whether an individual received more than one-half of

his or her support from a taxpayer, there shall be taken into account the amount of
                                       - 12 -

support received from the taxpayer as compared to the entire amount of support

which the individual received from all sources. Id.

      Petitioner failed to carry his burden of showing by competent evidence that

he provided at least half of all support for Ms. Hinkle during 2013. In order for

petitioner to establish that he provided more than one-half of Ms. Hinkle’s total

support during 2013, petitioner must establish the total amount of Ms. Hinkle’s

support from all sources for the year. See Archer v. Commissioner, 73 T.C. 963,

967 (1980); Blanco v. Commissioner, 56 T.C. 512, 514-515 (1971); sec. 1.152-

1(a)(2)(i), Income Tax Regs. If the amount of total support for the year cannot be

reasonably inferred from competent evidence, then it is not possible to conclude

that the taxpayer furnished more than one-half of the total amount of support.

Blanco v. Commissioner, 56 T.C. at 514-515; Stafford v. Commissioner, 46 T.C.

515, 518 (1966).

      Petitioner demonstrated by credible evidence that he paid the bulk of the

household expenses for the apartment in which Ms. Hinkle and C.B. lived,

including paying the rent for their apartment and providing $4,511 from his tax

refund, which was used for expenses such as utilities. Ms. Hinkle received SNAP

benefits which provided for her food. We think it is reasonable to surmise that

under the circumstances Ms. Hinkle’s parents were trying to help her during 2013,
                                        - 13 -

and the record shows that Ms. Hinkle’s parents provided her with additional

support. Ms. Hinkle did not testify at trial, and the record does not contain any

evidence of the amount of her other personal expenses, such as clothing, medical

care, or transportation. Thus petitioner has not provided the Court with sufficient

evidence of the total amount of support Ms. Hinkle received during the taxable

year 2013. Accordingly we cannot find that he provided at least half of that

amount, and he is not entitled to a dependency exemption for Ms. Hinkle. See

Blanco v. Commissioner, 56 T.C. at 514-515; Stafford v. Commissioner, 46 T.C.

at 518.

II.   Head of Household

      Section 2(b) provides that a head of household includes an unmarried

individual if the individual maintains a home which is the principal place of

abode, for at least one-half of the year, for either a qualifying child (defined under

section 152(c)) or any other person who is the individual’s dependent under

section 151. Petitioner has established that C.B. was his qualifying child for

taxable year 2013.

      An individual will be considered to maintain a household only if the

individual pays more than one-half of the expenses associated with the household.

The expenses of maintaining a household include property taxes, mortgage
                                           - 14 -

interest, rent, utility charges, upkeep and repairs, property insurance, and food

consumed on the premises. Sec. 1.2-2(d), Income Tax Regs. Such expenses do

not include the cost of clothing, education, medical treatment, vacations, life

insurance, and transportation. Id.

       As discussed supra p. 13, petitioner established that he paid rent and utilities

for an apartment which was the principal abode for himself, Ms. Hinkle, and C.B.

during the taxable year 2013. The household also received Government assistance

for food expenses; however, the amount of this assistance was less than the

amount petitioner provided for rent. Petitioner is entitled to head of household

filing status for the taxable year 2013.

III.   Child Tax Credit

       Section 24(a) allows a tax credit of a specified amount with respect to each

qualifying child of a taxpayer. As pertinent here, section 24(c)(1) provides that,

for purposes of section 24, “qualifying child” means an individual under age 17

who is a qualifying child of the taxpayer as defined in section 152(c). As

discussed above, petitioner has shown that C.B. is his qualifying child under

section 152(c). Therefore, petitioner is entitled to the child tax credit for the 2013

taxable year.
                                        - 15 -

IV.   Earned Income Credit

       Section 32(a)(1) permits an eligible individual an earned income credit

against the individual’s tax liability. On his 2013 return, petitioner claimed an

earned income credit for an eligible individual with one qualifying child. See sec.

32(c)(1)(A)(i). Section 32(c) provides that term “eligible individual” includes an

individual who has a qualifying child during the taxable year. Sec. 32(c)(1)(A)(ii).

      A qualifying child for purposes of section 32 is defined by reference to

section 152(c), with certain modifications not relevant here. As discussed above,

petitioner has established that C.B. was his qualifying child under section 152(c)

during 2013. Accordingly, petitioner is entitled to the earned income credit

computed for an eligible individual with one qualifying child.

V.    Conclusion

      Petitioner has established that C.B. was his qualifying child for the taxable

year 2013. Accordingly, he is entitled to a dependency exemption deduction for

C.B., head of household filing status, a child tax credit, and an earned income tax

credit for a qualified individual with one qualifying child. Petitioner has not

shown that Ms. Hinkle was his qualifying relative, and he is not entitled to a

dependency exemption deduction for her for the taxable year 2013.
                            - 16 -

To reflect the foregoing,

                                     Decision will be entered under

                               Rule 155.
