Damon L. Campbell

United States Tax Court
Docket No.: 13891-20 Page 1 of 1
Washington, DC 20217
DAMON L. CAMPBELL,
Pet it ioner
v. Docket No. 13891-20
COMMISSIONER OF INTERNAL
REVENUE,
Respondent
ORDER
Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is
ORDERED that the Clerk of the Court shall transmit herewith to petitioner
and to respondent a copy of the pages of the transcript of the trial in the above case
before Judge Albert G. Lauber at New York, New York, con­t aining his oral findings of
fact and opinion rendered on April 12, 2022, during the trial session at which the case
was heard.
In accordance with the oral findings of fact and opinion, decision will be entered
in due course.
(Signed) Albert G. Lauber
Judge
Served 05/27/22
3
1 Bench Opinion by Judge Albert G. Lauber
2 April 12, 2022
3 Damon L. Campbell v. Commissioner
4 Docket No. 13591-20
5 THE COURT: The Court has decided to render the
6 following as its oral findings of fact and opinion in this
7 case. This bench opinion is made pursuant to the
8 authority granted by section 7459(b) of the Internal
9 Revenue Code and Tax Court Rule 152, and it shall not be
10 relied upon as precedent in any other case. Rule
11 references in this opinion are to the Tax Court Rules of
12 Practice and Procedure, and statutory references are to
13 the Internal Revenue Code, as amended and in effect at all
14 relevant times. We round all monetary amounts to the
15 nearest dollar.
16 This case involves petitioner's 2018 tax year.
17 On September 21, 2020, the Internal Revenue Service (IRS
18 or respondent) issued petitioner a timely notice of
19 deficiency determining a deficiency of $5,682 and an
20 accuracy-related penalty of $1,136. The IRS subsequently
21 conceded the penalty. Thus, only the deficiency remains
22 in issue.
23 The question for decision is whether petitioner
24 for 2018 was entitled to claim two minor children as
25 "qualifying children" within the meaning of section
4
1 152(c). His ability to claim his children as qualifying
2 children determines the outcome of all the remaining
3 issues. We tried this case on April 11, 2022, in New
4 York, New York.
5 FINDINGS OF FACT
6 The following facts are drawn from the
7 pleadings, a joint stipulation of facts, and the documents
8 and testimony admitted into evidence at trial. Petitioner
9 resided in Jersey City, New Jersey, when he filed the
10 petition.
11 Petitioner and his wife, Precious Scott, married
12 in 2011. They have two children, D.C. and J.C., and
13 petitioner has one stepdaughter, A.C. (We refer to minor
14 children by their initials.) In 2018 petitioner and his
15 wife separated. Since then, D.C., J.C., and A.C. have
16 lived at all relevant times with Ms. Scott in Brooklyn,
17 New York, where they attend public school. There is no
18 separation agreement in place.
19 Petitioner timely filed a Federal income tax
20 return for 2018. On this return he claimed head-of-
21 household filing status, which resulted in his claiming a
22 standard deduction of $18,000. In 2018 the standard
23 deduction was $18,000 for heads of households and $12,000
24 for single filers. He claimed D.C. and A.C. as qualifying
25 dependents, which generated an earned income tax credit of
5
1 $880 and an additional child tax credit of $1,437.
2 The IRS selected petitioner's 2018 return for
3 examination and determined that he had failed to establish
4 that his minor children were qualifying children. The IRS
5 accordingly determined that he was not entitled to head-
6 of-household filing status, the earned income tax credit,
7 or the additional child tax credit. The IRS reduced his
8 standard deduction from $18,000 to $12,000 and disallowed
9 the two credits. These adjustments generated the $5,682
10 deficiency at issue.
11 OPINION
12 The IRS's determinations in a notice of
13 deficiency are generally presumed correct, and the
14 taxpayer bears the burden of proving them erroneous. Rule
15 142(a). Deductions and credits are a matter of
16 legislative grace, and the taxpayer bears the burden of
17 proving his entitlement to deductions and credits allowed
18 by the Code. INDOPCO, Inc. v. Commissioner, 503 U.S. 79,
19 84 (1992). Petitioner does not contend that the burden of
20 proof should shift to respondent under section 7491.
21 Petitioner therefore bears the burden of proof on all
22 factual issues.
23 On his Federal income tax return for 2018
24 petitioner claimed head-of-household filing status, an
25 earned income tax credit, and an additional child tax
6
1 credit. His entitlement to head-of-household status, the
2 earned income tax credit, and child tax credit is governed
3 by sections 2, 32, and 24, respectively.
4 To qualify as the head of a household the
5 taxpayer must, among other requirements, "maintain as his
6 home a household which constitutes for more than one-half
7 of such taxable year the principal place of abode ... [of]
8 a qualifying child." § 2(b)(1)(A). To be entitled to an
9 earned income tax credit, the taxpayer must have a
10 "qualifying child" during the taxable year. § 2(c)(1)(A).
11 And a child tax credit is allowable only "with respect to
12 each qualifying child of the taxpayer." § 24(a). Thus,
13 petitioner bears the burden of proving that during 2018
14 D.C. and A.C. were "qualifying" children.
15 Section 152(c)(1) defines the term "qualifying
16 child." See §§ 2(b)(1)(A)(i), 24(c)(1), and 32(c)(3)(A)
17 (cross-referring to section 152(c)). Section 152(c)(1)(B)
18 provides that a child is not a qualifying child unless he
19 "has the same principal place of abode as the taxpayer for
20 more than one-half of such taxable year." Petitioner did
21 not produce any evidence showing that his children resided
22 with him at any point during 2018. Quite the contrary:
23 Petitioner stipulated that, after separating from his wife
24 in 2018, he lived in New Jersey, while D.C. and A.C. lived
25 in New York with their mother 100% of the time.
7
1 Accordingly, petitioner has not established that he had a
2 "qualifying child" during 2018. He is therefore not
3 entitled to head-of-household filing status, an earned
4 income tax credit, or a child tax credit.
5 Petitioner urges that he helped support his
6 children. But support is not relevant where the children
7 do not have "the same principal place of abode as the
8 taxpayer for more than one-half of [the] taxable year."
9 § 152(c)(1)(B). And even if support were relevant,
10 petitioner supplied no evidence that he provided
11 meaningful support to D.C. and A.C. There is nothing in
12 the documents petitioner supplied to respondent or to the
13 Court that substantiates any support.
14 At trial petitioner admitted that he did not
15 send his wife monthly checks or provide other support
16 directly to her. He stated that he took the children to
17 restaurants occasionally and that his wife sometimes asked
18 him for money. But petitioner did not supply to
19 respondent or the Court actual proof of support because
20 (he said) "it was not enough."
21 Consistent with the foregoing, decision will be
22 entered for respondent with respect to the deficiency and
23 for petitioner with respect to the accuracy-related
24 penalty. This concludes the Court's oral findings of fact
25 and opinion in this case.
8
1 (Whereupon, at 3:47 p.m., the above-entitled
2 matter was concluded.)
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