                  T.C. Summary Opinion 2002-156



                       UNITED STATES TAX COURT



              LYNDELL SCOTT HEGWOOD, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 9398-01S.             Filed December 20, 2002.


     Lyndell Scott Hegwood, pro se.

     Marshall R. Jones, for respondent.


     BEGHE, 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 in

effect for the year in 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 a deficiency of $4,336 in petitioner’s

Federal income tax for 2000, attributable to respondent’s

determinations (1) that petitioner was required to file as single

rather than as head of household, (2) that petitioner’s claim to

exemptions for three dependent children had not been

substantiated, and (3) that petitioner was not entitled to the

earned income credit.   Of the deficiency, $2,585 is attributable

to respondent’s disallowance of the earned income credit.

     The first two issues having been resolved by agreement in

petitioner’s favor, the issue remaining for decision is

petitioner’s right to the earned income credit.   Although

respondent has conceded that petitioner qualifies as head of

household by reason of his maintaining a household that includes

minor children who are his dependents, respondent continues to

assert that petitioner does not have a “qualifying child” who is

an “eligible foster child of the taxpayer” within the meaning of

section 32(c)(3)(B)(i), as amended, effective for taxable years

beginning after December 31, 1999, by the Ticket to Work and Work

Incentives Improvement Act of 1999, Pub. L. 106-170, sec. 612(a),

113 Stat. 1917 (the 1999 Act).

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

The stipulation of facts and accompanying exhibits are

incorporated herein by this reference.   At the time the petition

was filed, petitioner resided in Bay St. Louis, Mississippi.
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      Petitioner and the mother of the three dependent children

have been living together for more than 10 years, and petitioner

provides the primary support for the household, which includes

the dependent children.   Mississippi abolished common-law

marriage in 1956, Miss. Code Ann. sec. 93-1-15(1) (1999), and the

living arrangement of petitioner and the mother is illegal under

Mississippi law, Miss. Code Ann. sec. 97-29-1 (1999); see also

Davis v. Davis, 643 So. 2d 931 (Miss. 1994); Sullivan v.

Stringer, 736 So. 2d 514 (Miss. Ct. App. 1999).   Petitioner does

not claim a dependency exemption for the mother, and correctly

so.   See Turnipseed v. Commissioner, 27 T.C. 758 (1957).

However,   petitioner asserts that his living arrangement with the

children does not violate Mississippi law, and that continuation

of this arrangement should be encouraged.

      Petitioner has cared for the mother’s children as his own

and claimed them as his foster children since 1991.   Petitioner

asserts that the State of Mississippi accepts these children as

his foster children, citing as evidence the high school record of

one of the children showing the names of both petitioner and the

mother as “Parent/Guardian” of the child in question, with the

relationship between petitioner and the child labeled “F-Father”.

Petitioner also asserts that no one else claims the children as

dependents or foster children for tax purposes, and that the
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children’s biological father has not seen them since 1990 and

does not pay any child support.

     Respondent’s determination that for 2000 and later years

none of the mother’s children is or can be a “qualifying child”

of petitioner is based on the section 32(c)(3) definition of

“qualifying child”, as amended by the 1999 Act.    This definition

requires that the taxpayer and the child satisfy the relationship

test of subparagraph (B)(iii).    Under this test, the child, if

not a child or descendant of a child of the taxpayer under clause

(i)(I) or a stepchild of the taxpayer under clause (i)(II), must

be “an eligible foster child of the taxpayer” under clause

(i)(III).1

     “Eligible foster child” is defined by clause (i)(III) as an

individual not defined in clause (i)(I) or (II) who:

          (I) is a brother, sister, stepbrother, or
     stepsister of the taxpayer (or a descendant of
     any such relative) or is placed with the taxpayer
     by an authorized placement agency, [Emphasis added.]

          (II) the taxpayer cares for as the taxpayer’s
     own child, and


     1
      Prior to enactment of the 1999 Act, section
32(c)(3)(B)(iii) simply defined an “eligible foster child” as an
individual not described in clause (i)(I) or (II) who--

          (I) the taxpayer cares for as the taxpayer’s
     own child, and

           (II) has the same principal place of abode
     as the taxpayer for the taxpayer’s entire taxable
     year.
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            (III) has the same principal place of abode
      as the taxpayer for the taxpayer’s entire taxable
      year.

      Respondent acknowledges that petitioner cares for the

children in question as his own and that those children and

petitioner have the same principal place of abode.

      Petitioner acknowledges that the children have not been

“placed with the taxpayer by an authorized State agency”.

Indeed, there was an intimation at trial that petitioner and the

mother view as unfair the refusal or failure of the Mississippi

Department of Human Services to place the children with

petitioner as his foster children.     The Court is left with the

impression that the Mississippi Department of Human Services has

not placed the children with petitioner as his foster children

because of the technical illegality of petitioner’s living

arrangement with the mother.

      With the change in section 32(c)(3) that became effective

for the taxable year, petitioner took the return position, after

discussion with the mother, who is the sole custodial parent,

that she was authorized to “place” the children with petitioner

as his foster children.   Although there is no documentary

evidence or testimony in the record that the mother has “placed”

any of the children with petitioner as their foster father, we

will assume for purpose of argument that she has attempted to do

so.
                               - 6 -

     Petitioner and the mother have not married for economic

reasons.   They explain that if they were to marry, the mother

would be disqualified from receiving certain prescription drug

benefits she is currently entitled to.

     The Court has looked for legislative history to explain the

purpose served by the more restrictive definition of “foster

child” provided by the 1999 Act.

     In the Joint Committee Print of the Description of Revenue

Provisions Contained in the President’s Fiscal Year 2000 Budget

Proposal prepared by the Staff of the Joint Committee on Taxation

(Feb. 22, 1999) (hereinafter, the Joint Committee Print), section

412(a) of the 1999 Act is classified under “Miscellaneous

Revenue-Increase Provisions”, and is captioned as a provision to

“Simplify foster child definition under the earned income

credit”.   In the absence of hearings and reports by the House

Ways and Means Committee and the Senate Finance Committee, the

Joint Committee Print is the only source that has come to the

Court’s attention that sheds any light on the purpose of section

412(a) of the 1999 Act.2   Although respondent suggests the Joint

Committee Print “is probably not to be considered ‘legislative

history’ in the strict sense of the term”, it was provided to the

members of the House and Senate for their reference before

     2
      The cursory description of sec. 412(a) of the 1999 Act in
the conference report provides no help. See H. Conf. Rept. 106-
478, at 61 (1999).
                               - 7 -

Congress enacted the 1999 Act; it is therefore part of the

history of the legislation.   See Robinson v. Commissioner, 119

T.C. 44, 73 (2002).

     The description of section 412(a) of the 1999 Act in the

Joint Committee Print at 326 indicates that placement by an

“authorized placement agency” should be interpreted as placement

“by an agency of a State or one of its political subdivisions or

by a tax-exempt child placement agency licensed by a State”.    The

Joint Committee Print goes on to state that “some advocates” of

the new provision believe it would:    “(1) reduce potential abuse

by tax cheats; (2) prevent unintentional errors by confused

taxpayers; and (3) provide better guidance to the IRS when

investigating questionable EIC claims.”   According to the Joint

Committee Print, critics of the proposal attacked its adverse

effect on “legitimate family living arrangements” and stated that

it would not completely simplify the foster child definition,

because section 32(c)(3)(B)(iii)(II) retains the subjective test

that the individual must be cared for “as the taxpayer’s own

child”.

     To summarize, other than what may be inferred from the

provision’s classification as a “Revenue-Increase” provision in

the Joint Committee Print, the main purposes of its enactment

appear to have been (1) to reduce unintentional errors by

taxpayers by simplifying to some extent the foster child
                              - 8 -

definition, (2) to increase taxpayer compliance by reducing

intentionally improper foster child claims, and (3) to provide

the Internal Revenue Service with a clear subset of claimed

foster children who fit within the definition of “eligible foster

child”.

     Applying these considerations to the facts of the case at

hand, there appears to be no likelihood of unintentional or

intentional error in petitioner’s claim, in the sense that there

is no reasonable possibility that anyone else is claiming the

children as dependents; in fact, they are petitioner’s

dependents, as respondent concedes.    Furthermore, both

preexisting requirements for qualification as a foster child--

care for the children as one’s own child and the sharing of the

principal place of abode for the entire year--continued to be

satisfied during the taxable year in issue.

     Notwithstanding these considerations, the new provision of

the 1999 Act is clear on its face and leaves no room for

interpretation in its application to the case at hand.     The

children have not been placed with petitioner by an agency of the

State of Mississippi or one of its political subdivisions or by a

tax-exempt child placement agency licensed by the State of

Mississippi, nor by a Mississippi Chancery Court.    See LW v.

C.W.B., 762 So. 2d 323 (Miss. 2000).    Nothing in the Joint

Committee Print or the 1999 Act as written suggests the new rule
                              - 9 -

is to be disregarded where the State agency having jurisdiction

has refused or failed to make the placement because it

disapproves what in a majority of other States would be

considered a “legitimate family living arrangement”.    Neither

does the Court believe it has any proper standing to base its

decision on its disagreement with the State agency’s failure to

draw a compassionate distinction between the technical illegality

under Mississippi law of petitioner’s living arrangement with the

mother and the social benefit to be gained from providing

additional encouragement of his continued support and surrogate

fatherhood of the children.

     Although respondent, in an effort to help petitioner,

suggested at trial that petitioner might be arguing the new

requirement is unconstitutional as applied to him because of its

interaction with Mississippi law and administrative practice,

petitioner has made no such argument.   Neither the record in this

case nor the arguments of the parties provide any basis for an

inquiry by the Court into the issue of constitutionality.    See

Ashwander v. TVA, 297 U.S. 288, 346-348 (1936) (Brandeis, J.,

concurring).

     The Court is constrained to sustain respondent’s

determination that petitioner is not entitled to the earned

income credit for the year 2000.
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     To give effect to the foregoing and respondent’s

concessions,

                                   Decision will be entered

                              under Rule 155.
