Haft v. Commissioner

Memorandum Findings of Fact and Opinion

DAWSON, Judge: In these consolidated cases respondent determined the following Federal income tax deficiencies aginst the petitioners:

At the trial of these cases Joyce T. Haft and respondent conceded*323 that Alfred L. Haft is entitled to the deduction for the dependency exemption for Christine, the petitioners' eldest daughter. Respondent agrees that if Joyce T. Haft is entitled to the dependency exemption deduction for Alfred L. Haft, Jr., she is also entitled under section 214, Internal Revenue Code of 1954, ¹ to deduct $600 for child care expenses. Alfred L. Haft has conceded that respondent correctly disallowed $150 he claimed as contributions. Thus, the only issue remaining for decision is which of the petitioners provided more than half of the total support of their three minor children, Cathy, Constance and Alfred, Jr., in the year 1964 for dependency exemption deduction purposes under sections 151(e) and 152(a).

Findings of Fact

Some of the facts were stipulated by the parties and are found accordingly.

Joyce T. Haft was a legal resident of New York, New York, when she filed her petition in this proceeding. Her individual Federal income tax return for the year 1964 was filed with the district director of internal revenue in Brooklyn, New*324 York.

Alfred Lewis Haft was a legal resident of Mount Vernon, New York, when he filed his petition in this proceeding. His individual Federal income tax return for the year 1964 was filed with the district director of internal revenue for the Manhattan District.

Alfred and Joyce are the parents of four children. In 1964 the children, Christine (age 17), Cathy (age 14), Constance (age 11) and Alfred, Jr. (age 6), were all minors.

On July 11, 1962, petitioners were separated pursuant to a judgment entered by the Supreme Court of the State of New York for Nassau County. The judgment provided, in part, that Joyce would have custody of the children subject to Alfred's visitation rights, and that Alfred would pay to Joyce for the support of the children the sum of $125 per week.

During 1964 Cathy, Constance and Alfred Jr. resided with their mother. Christine attended a boarding school for over 8 months and resided with her mother during the summer. Alfred exercised his visitation rights during that year. 125

In 1964 Alfred was a salesman whose gross income was $18,701.23. Joyce was a school teacher whose gross income was $6,895.58. In 1964 she received tax refunds totaling*325 $816.01, and her mother, Mrs. Caroline F. Tamres, gave her about $3,000. Joyce also withdrew about $1,000 from savings accounts.

Pursuant to the Court judgment, Alfred paid $125 per week in 1964 as child support. These totaled $6,500. In addition, he took three children on a summer vacation for 10 days to 2 weeks at a cost of about $60 per child, and he gave each child gifts of $100 during the year. He provided $1,785 for each of these children.

The total amount spent for the support of the three children in 1964 was approximately $10,652.19, as follows:

Alfred L. Haft provided more than half of the total support for*326 Cathy and Constance in 1964. Joyce T. Haft provided more than half of the total support for Alfred Jr. in 1964.

Opinion

The only issue we must decide is which of the petitioners, Joyce or Alfred, is entitled under section 151(e) to the dependency deductions claimed by each of them for Cathy, Constance and Alfred Jr. in 1964. To protect the revenue, respondent originally disallowed the claimed exemptions to both petitioners. However, he now takes a neutral position, contending that the Court should decide on the evidence presented which petitioner is entitled to the exemptions.

Section 152(a) defines the term "dependent" as meaning a daughter or son of the taxpayer "over half of whose support, for the calendar year in which the taxable year of the taxpayer begins, was received from the taxpayer."

It is quite apparent from the testimony of Joyce and Alfred that they fulfilled their parental responsibilities by providing a substantial amount for the support of each child. The figures are close. We believe some of the claimed expenditures of both are inflated. Consequently, we have reduced some of them that were based on estimates. In Alfred's case, we have reduced the claimed*327 vacation expenses and gifts, and eliminated all amounts he claimed for purchases of clothing for the children. In Joyce's case, we have substantially reduced the estimate of $100 per month per child for food. In our opinion her estimate of food costs is grossly inflated. We have allowed only $600 per child for food in the year 1964. ²

After considering and weighing all of the evidence presented, we have concluded and found as a fact that Alfred provided more than half of the support for Cathy and Constance in 1964, and that Joyce*328 provided more than half of Alfred Jr.'s support in such year. Joyce is also entitled to a $600 child care expense deduction for Alfred Jr.

To reflect these conclusions and the concessions made by the parties,

Decisions in both dockets will be entered under Rule 50. 126