United States Tax Court

United States Tax Court

T.C. Memo. 2022-10

JAMES LEE HICKS, JR.,

Petitioner

v.

COMMISSIONER OF INTERNAL REVENUE,

Respondent

—————

Docket No. 10406-17.

Filed February 23, 2022.

—————

James Lee Hicks, Jr., pro se.

Emly B. Berndt, John D. Davis, and Nancy P. Klingshirn, for

respondent.

MEMORANDUM FINDINGS OF FACT AND OPINION

GALE, Judge: Respondent determined a deficiency in petitioner’s

2014 federal income tax of $3,975. The issues for decision are whether

petitioner is entitled to dependency exemption deductions under section

151(a) and (c) and child tax credits under section 24(a). 1

FINDINGS OF FACT

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

Stipulation of Facts and its Exhibits are incorporated herein by this

reference. Petitioner resided in Ohio when he filed his Petition.

1 Unless otherwise indicated, all statutory references are to the Internal

Revenue Code, Title 26 U.S.C., in effect at all relevant times, all regulation references

are to the Code of Federal Regulations, Title 26 (Treas. Reg.), in effect at all relevant

times, and all Rule references are to the Tax Court Rules of Practice and Procedure.

Served 02/23/22

2

[*2] Petitioner and Oddimissia N. Johnson had two children together

who were minors in 2014. Petitioner and Oddimissia never married and

were living separately throughout 2014. During 2014 Oddimissia and

her mother, Juanita Johnson, lived in the same principal place of abode

and the children resided with Oddimissia and Juanita for more than

one-half of the year. Petitioner provided over one-half of the children’s

support for 2014.

On June 15, 2006, the Summit County Court of Common Pleas

Domestic Relations Division (state court) adopted a “Shared Parenting

Plan” that had been signed by petitioner and Oddimissia, which

provided, inter alia, that “Mother [Oddimissia] will claim [Child 1 2]

every year and Father [petitioner] will claim [Child 2] every year for tax

purposes unless [the] parties reach another agreement in writing.”

The state court later entered an order and judgment on

October 28, 2009, which adjusted petitioner’s and Oddimissia’s child

support obligations and further stated: “Effective tax year 2009, Father

[petitioner] shall claim the dependency exemption for both minor

children each year.” The October 2009 order and judgment were not

signed by Oddimissia or petitioner.

A state court order entered on August 26, 2010, and in effect for

the 2014 taxable year modified the periods in which each parent would

have physical custody of the children. Under this arrangement

petitioner had physical custody of the children for less than one-half of

2014 and Oddimissia had physical custody for more than one-half of that

year. This August 2010 order did not modify the October 2009 order,

which provided that petitioner “shall claim” the dependency exemption

for both children each year.

Petitioner timely filed his 2014 federal income tax return, on

which he claimed dependency exemption deductions and child tax

credits for the two children. Petitioner did not attach any of the

following to his 2014 return: (1) Form 8332, Release/Revocation of

Release of Claim to Exemption for Child by Custodial Parent, (2) a

written declaration or any other waiver signed by Oddimissia, or (3) a

pre-2008 court decree or separation agreement. He has, however, since

2 Although the Shared Parenting Plan refers to the children by their full names

(which the parties have properly redacted), the Court typically refers to minor children

only by their initials. See Rule 27(a)(3). Because the children in this case have

identical initials, for clarity we refer to them as Child 1 and Child 2.

3

[*3] given respondent a copy of the Shared Parenting Plan that

Oddimissia signed and the state court adopted in 2006.

Oddimissia did not file a federal income tax return for 2014. 3

Juanita did so, and she claimed a dependency exemption deduction for

Oddimissia and for each of the two children on that return.

Respondent subsequently issued a notice of deficiency to

petitioner denying the dependency exemption deductions and the child

tax credits he claimed for the children. Petitioner filed a timely Petition

for redetermination.

OPINION

I.

Burden of proof

In general, the Commissioner’s determinations set forth in a

notice of deficiency are presumed correct, and the taxpayer bears the

burden of proving otherwise. Rule 142(a); Welch v. Helvering, 290 U.S.

111, 115 (1933). The taxpayer bears the burden of proving entitlement

to any deduction or credit claimed. Segel v. Commissioner, 89 T.C. 816,

842 (1987). Petitioner does not contend that the burden of proof should

shift to respondent under section 7491(a), nor has he established that

the requirements for shifting the burden of proof have been met.

Accordingly, the burden of proof remains on petitioner. See § 7491(a)(2).

II.

Dependency exemption deduction

Section 151(a) and (c) allows a taxpayer a deduction for each

individual who is a dependent of the taxpayer as defined in section 152.

Section 152(a) defines the term “dependent” to mean either a “qualifying

child,” see § 152(a)(1), (c), or a “qualifying relative,” see § 152(a)(2), (d),

of the taxpayer. We note that while respondent failed to address the

issue of whether the children are qualifying relatives of petitioner, such

an inquiry is necessary to determine whether he is entitled to any

dependency exemption deductions for 2014.

A.

Qualifying child

In order to be a taxpayer’s qualifying child, an individual must:

(A) bear a specified relationship to the taxpayer, including being a child

3 Respondent’s computer-generated transcripts for Oddimissia for 2014 show

that she attempted to file a return for that year but that respondent rejected it.

4

[*4] or grandchild thereof; (B) have the same principal place of abode as

the taxpayer for more than one-half of the taxable year; (C) meet certain

age requirements; (D) have not provided more than one-half of his or her

own support for the year; and, if married, (E) have not filed a joint return

(other than only for a claim of refund) with his or her spouse. § 152(c)(1)

and (2).

Petitioner concedes that the children resided with Oddimissia for

more than one-half of 2014. Thus, the children did not have the same

principal place of abode as petitioner for more than one-half of 2014 and,

for that reason, are not his qualifying children for 2014.

See

§ 152(c)(1)(B).

B.

Qualifying relative

The term “qualifying relative” means an individual: (A) who bears

a specified relationship to the taxpayer, including being a child or

grandchild thereof; (B) whose gross income is less than the exemption

amount ($3,950 for 2014); (C) with respect to whom the taxpayer

provides over one-half of his or her support; and (D) who is not a

qualifying child of the taxpayer or of any other taxpayer. § 152(d)(1)

and (2).

Respondent concedes that petitioner provided over one-half of the

children’s support for 2014, and they satisfy the foregoing relationship

and income tests. 4 We shall therefore examine whether the children are

the qualifying children of any other taxpayer, as we have already

determined that the children are not the qualifying children of

petitioner.

The children meet the requirements under section 152(c)(1) to be

the qualifying children of both Oddimissia and Juanita: (A) they are the

children of Oddimissia and the grandchildren of Juanita; (B) they had

the same principal place of abode as Oddimissia and Juanita for more

than one-half of 2014; 5 (C) they were minors during 2014; (D) each did

4 We are satisfied on this record that neither child had income exceeding $3,950

for 2014, as the parties have stipulated they were both minors in that year.

5 We note that petitioner concedes that the children lived with Oddimissia for

more than one-half of 2014. Oddimissia and Juanita lived in the same principal place

of abode for 2014. Therefore by extension the children lived with Juanita for more

than one-half of 2014.

5

[*5] not provide more than one-half of his own support for 2014; and

(E) they did not file joint returns for 2014. 6

A “tie-breaker” rule under section 152(c)(4)(A) provides that if an

individual “may be claimed as a qualifying child” by two or more

taxpayers, such individual shall be treated as the qualifying child of the

taxpayer who is the parent of the individual (or, if a parent does not so

qualify, the taxpayer with the highest adjusted gross income for the

taxable year). However, section 152(b)(1) provides that if an individual

is a dependent of a taxpayer for any taxable year, that individual shall

be treated as having no dependents for that year. Since Juanita claimed

Oddimissia as a dependent for 2014, Oddimissia is treated as having no

dependents in 2014 under section 152(b)(1). Consequently the children

may not be claimed as qualifying children by Oddimissia for 2014, and

the tie-breaker rule under section 152(c)(4)(A) does not apply.

Accordingly, the children are treated as the qualifying children of

Juanita for 2014.

Since the children are the qualifying children of Juanita for 2014,

they cannot be the qualifying relatives of petitioner for that year. See

§ 152(d)(1)(D).

C.

Special rule for separated parents

As we have explained, the children are not qualifying children of

petitioner for 2014 under the usual requirements of section 152(c)

because they did not have the same principal place of abode as petitioner

for more than one-half of the year, as required by section 152(c)(1)(B).

However, section 152(e) establishes a special rule for children of

divorced or separated parents. Under this special rule, if several criteria

are satisfied, a child may be treated as the qualifying child of a parent

with whom he or she did not share a principal place of abode for a

sufficient portion of the year, regardless of the usual requirement of

section 152(c)(1)(B) or the tie-breaker rule of section 152(c)(4). 7 See

6 We are satisfied that as minors the children were not married and therefore

ineligible to file such returns.

7 When the relevant criteria are satisfied, section 152(e) also allows a child to

be treated as a qualifying relative of a parent who has not provided over one-half of

the child’s support for the calendar year as required by section 152(d)(1)(C). But as we

have explained, in this case the reason the children are not petitioner’s qualifying

relatives is the requirement in section 152(d)(1)(D) that a taxpayer’s qualifying relative

not be a qualifying child of any other taxpayer. Section 152(e) does not alter that

6

[*6] § 152(e); Swint v. Commissioner, 142 T.C. 131, 133 (2014); Seeliger

v. Commissioner, T.C. Memo. 2017-175, at *4–6.

Section 152(e) applies to a child who is in the custody of one or

both parents for more than one-half of a calendar year, receives over

one-half of his or her support during the year from his or her parents,

and whose parents are divorced, separated, or living apart throughout

the last six months of the year. § 152(e)(1). When section 152(e) applies,

a child is generally treated as the qualifying child of the “custodial

parent.” See § 152(e)(1), (4); Swint, 142 T.C. at 133. The custodial

parent is “the parent having custody [of the child] for the greater portion

of the calendar year,” while the “noncustodial parent” is “the parent who

is not the custodial parent.” § 152(e)(4); see also Maher v. Commissioner,

T.C. Memo. 2003-85, slip op. at 10 (stating that the Court has repeatedly

looked to where a child resided to determine which parent had physical

custody for purposes of section 152(e)(1)); Treas. Reg. § 1.152-4(d)(1).

Petitioner provided over one-half of the children’s support for

2014, and he and Oddimissia lived apart throughout the year.

Additionally, as we have noted, petitioner concedes that the children

resided with Oddimissia for more than one-half of 2014. We therefore

find that, for purposes of section 152(e), Oddimissia was the children’s

custodial parent and petitioner was their noncustodial parent for 2014.

Accordingly, both children would ordinarily be treated as Oddimissia’s

qualifying children, and she would thus ordinarily be entitled to claim

both dependency exemption deductions pursuant to sections 151(c) and

152(a).

However, a child is instead treated as the qualifying child of the

noncustodial parent—thus shifting the right to claim the dependency

exemption deduction for that child to the noncustodial parent—if two

conditions are met: (1) the custodial parent “signs a written declaration

(in such manner and form as the Secretary may by regulations

prescribe)” stating that he or she “will not claim such child as a

dependent” for the year at issue, and (2) the noncustodial parent

“attaches” the written declaration to his or her return for that year.

§ 152(e)(2). Consequently, as the noncustodial parent, petitioner’s

eligibility to claim a dependency exemption deduction for either child for

requirement, and therefore does not affect our conclusion that the children are not

qualifying relatives of petitioner for 2014.

7

[*7] 2014 depends on whether these written declaration and attachment

requirements have both been satisfied. 8

1.

Written declaration requirement

The written declaration requirement may be satisfied either by a

completed Form 8332 or by a statement conforming to the substance of

Form 8332.

See Swint, 142 T.C. at 133–34 (citing Miller v.

Commissioner, 114 T.C. 184, 189 (2000)); Treas. Reg. § 1.152-4(e)(1)(ii).

Form 8332 provides a uniform method for a custodial parent to make

the written declaration necessary to relinquish his or her right to claim

a child as a dependent in favor of a noncustodial parent. See Swint, 142

T.C. at 134 (citing Armstrong v. Commissioner, 139 T.C. 468, 472 (2012),

aff’d, 745 F.3d 890 (8th Cir. 2014)).

Because petitioner did not provide a completed Form 8332 to

respondent, he could have satisfied the written declaration requirement

only by means of some other document conforming to the substance of

Form 8332. The only other documents in the record that purport to shift

the right to claim the children as dependents from Oddimissia to

petitioner—and thus the only other documents that could potentially

stand in place of a Form 8332—are two state court orders: the Shared

Parenting Plan entered in 2006, which stated that each parent was

entitled to “claim” one of the two children for tax purposes, and the order

entered in 2009, which stated that petitioner “shall claim” the

dependency exemption deductions for both of the children beginning

with the 2009 taxable year.

“[A] court order or decree or a separation agreement entered prior

to July 2, 2008, can be a written declaration if it satisfies the other

requirements in effect at the time of entry.” Swint, 142 T.C. at 136

(citing Treasury Regulation § 1.152-4(e)(5)). However, a court order

entered after July 2, 2008, does not satisfy the written declaration

requirement for any taxable year beginning after that date. See Treas.

Reg. § 1.152-4(e)(1)(ii), (h). Consequently the state court order entered

in 2009 cannot satisfy the written declaration requirement for

petitioner’s 2014 taxable year. But the Shared Parenting Plan can

satisfy that requirement, as long as it meets the requirements governing

8 As discussed infra Part 2, respondent has waived the attachment

requirement under the circumstances of this case. See Prop. Treas. Reg. § 1.1525(e)(2)(i), 82 Fed. Reg. 6370, 6387 (Jan. 19, 2017).

8

[*8] written declarations for purposes of section 152(e) that were in

effect when the state court entered it in 2006.

In 2006 section 152(e)(2)(A) provided that a custodial parent could

release his or her claim to a dependency exemption deduction for a child

by “sign[ing] a written declaration (in such manner and form as the

Secretary may by regulations prescribe) that such custodial parent will

not claim such child as a dependent.” 9 Our precedents make clear that

this provision imposes several requirements on any document that a

taxpayer offers as a written declaration for purposes of section 152(e).

First, it must be signed by the custodial parent. See Swint, 142 T.C. at

136–37. Second, it must not place any conditions on the custodial

parent’s declaration that he or she will not claim a child as a dependent.

See id. at 137–39. And third, it must otherwise meet the manner and

form requirements the Secretary has prescribed by regulation. See

Miller, 114 T.C. at 188–90.

The Shared Parenting Plan meets all of these requirements. In

addition to bearing Oddimissia’s signature, it grants petitioner the

unconditional right to “claim” one child “every year for tax purposes

unless [the] parties reach another agreement in writing.” We are aware

of no written agreement between Oddimissia and petitioner that limits

this right. Although the state court modified the Shared Parenting Plan

in its 2009 order (which neither Oddimissia nor petitioner signed, 10

though the order represents that they both agreed with its terms), those

modifications did not diminish, for federal income tax purposes, the

right that Oddimissia granted to petitioner in the Shared Parenting

Plan. Rather, the 2009 order purported to expand that right by allowing

petitioner to claim both children instead of just one. The agreement

reflected in the Shared Parenting Plan therefore remains in effect,

regardless of the later state court order purporting to expand on that

agreement.

9 This provision was first enacted in 1984.

See Deficit Reduction Act of 1984,

Pub. L. No. 98-369, § 423(a), 98 Stat. 494, 799. Although section 152(e)(2)(A) was

briefly amended in 2004, see Working Families Tax Relief Act of 2004, Pub. L. No.

108-311, § 201, 118 Stat. 1166, 1173, that amendment was retroactively repealed in

2005, see Gulf Opportunity Zone Act of 2005, Pub. L. No. 109-135, § 404(a), (d), 119

Stat. 2577, 2632–34.

10 We note that the lack of Oddimissia’s signature means that the 2009 order

would not satisfy the written declaration requirement even if Treasury Regulation

§ 1.152-4(e)(1)(ii) and (h) did not independently prevent the 2009 order from satisfying

that requirement because it was entered after July 2, 2008.

9

[*9] Finally, the Shared Parenting Plan also comports with the other

manner and form requirements prescribed by the regulations that were

in effect in 2006. At that time, a noncustodial parent could satisfy the

written declaration requirement with either a completed Form 8332 or

a statement conforming to the substance of Form 8332. See Himes v.

Commissioner, T.C. Memo. 2010-97, slip op. at 5; Temp. Treas. Reg.

§ 1.152-4T(a), Q&A (3) (1984) (removed by T.D. 9408, 2008-33 I.R.B.

323). Therefore, if the Shared Parenting Plan conformed to the

substance of Form 8332, it could have been used to satisfy the written

declaration requirement.

“In order for a document to qualify as a statement conforming to

the substance of Form 8332, it must contain substantially the same

information required by Form 8332.” Miller, 114 T.C. at 191. Form 8332

would have required: (1) the names of the children for whom exemption

claims were released; (2) the years for which the claims were released;

(3) the custodial parent’s signature; (4) the date of the custodial parent’s

signature; (5) the noncustodial parent’s name; and (6) both parents’

Social Security numbers. See Himes, T.C. Memo. 2010-97, slip op. at 5.

The Shared Parenting Plan included: (1) the name of the child that

petitioner would be allowed to claim; (2) the years for which petitioner

could claim that child (“every year”); (3) Oddimissia’s signature; (4) the

state court’s date stamp; and (5) petitioner’s name.

Thus, the only information that would have been required by

Form 8332 that was not included in the Shared Parenting Plan was each

parent’s Social Security number. But the absence of either parent’s

Social Security number, standing alone, does not determine whether a

document conforms to the substance of Form 8332. See Boltinghouse v.

Commissioner, T.C. Memo. 2003-134, slip op. at 9 (noting that inclusion

of the noncustodial parent’s Social Security number elsewhere on a

return renders it “superfluous” in a written declaration); Bramante v.

Commissioner, T.C. Memo. 2002-228, slip op. at 6 (“Neither the statute

nor the regulations require . . . the custodial parent’s Social Security

number.”). Furthermore, any claim for a dependency exemption

deduction must include the claimed dependent’s taxpayer identification

number. See § 151(e). Respondent’s ability to identify duplicate

exemption claims therefore is not hampered by a written declaration

that lacks the parents’ Social Security numbers. We accordingly

conclude that the Shared Parenting Plan contains sufficient information

to conform to the substance of Form 8332.

10

[*10] The Shared Parenting Plan thus satisfies all requirements

applicable to written declarations for purposes of section 152(e) that

were in effect when the state court entered it in 2006. For his 2014

taxable year, petitioner may therefore rely on the Shared Parenting

Plan to satisfy the written declaration requirement with respect to the

one child it allows him to claim as a dependent.

2.

Attachment requirement

Under proposed regulations published in 2017, a noncustodial

parent is generally required to attach a copy of the written declaration

to a return that claims a dependency exemption. Prop. Treas. Reg.

§ 1.152-5(e)(2)(i), 82 Fed. Reg. at 6387. However, a noncustodial parent

also may either attach a copy of the written declaration to an amended

return or “submit a copy of the written declaration to the IRS during an

examination.” Id.; see also Skitzki v. Commissioner, T.C. Memo. 2019106, at *10 n.10; DeMar v. Commissioner, T.C. Memo. 2019-91, at *5–6.

Until the proposed regulations become final, “taxpayers may choose to

apply [them] in any open taxable years.” Preamble, Prop. Treas. Regs.,

82 Fed. Reg. at 6377. A taxable year remains open while it is pending

before this Court. See § 6503(a)(1).

Petitioner’s 2014 taxable year thus remains open, and Proposed

Treasury Regulation § 1.152-5(e)(2)(i) permits him to substantiate his

claim to a dependency exemption by submitting the Shared Parenting

Plan to respondent (which he has now done), 11 even though it was not

attached to his original return. Furthermore, respondent in his Pretrial

Memorandum and posttrial Opening Brief never mentions Proposed

Treasury Regulation § 1.152-5(e)(2)(i), nor does he make any specific

argument that petitioner failed to satisfy the attachment requirement

with respect to the Shared Parenting Plan. Under the circumstances of

this case, petitioner has therefore properly substantiated his right to

claim one of the two children as a dependent for 2014. As provided by

section 152(e)(1) and (2), that child is treated as petitioner’s qualifying

child for 2014, and he is accordingly entitled to one dependency

exemption deduction for that year under section 151(c).

11 The record does not establish whether petitioner first submitted the Shared

Parenting Plan to respondent during the examination of his return or while this case

was pending, when the parties included it as a stipulated Exhibit filed before trial.

Nevertheless, because petitioner could have submitted the Shared Parenting Plan as

an attachment to an amended return after the conclusion of the examination but before

trial, the timing of petitioner’s submission of the Shared Parenting Plan is immaterial.

11

[*11] III.

Child tax credit

A taxpayer may claim a child tax credit for “each qualifying child”

for which the taxpayer is allowed a deduction under section 151. § 24(a).

A qualifying child for purposes of section 24 is a “qualifying child” as

defined in section 152(c) who has not attained the age of 17. § 24(c)(1).

Because we have held that petitioner is treated as having one

qualifying child within the meaning of section 152(c) for the 2014

taxable year, it follows that he is also entitled to the child tax credit for

one child for that year.

To reflect the foregoing,

Decision will be entered under Rule 155.