- 18 -
any intent or policy concerning section 131, we believe it tends
to support our conclusion that the foster care provider must
reside in his (or her) section 131 “home”.15
Conclusion
Respondent has determined that the payments made with
respect to the properties other than the Morris Street property
are not excluded from petitioners' income under section 131.
Respondent's determination is presumed to be correct; petitioners
bear the burden of proof that respondent's determination is
erroneous, and that they are eligible for the exclusion.16 The
parties' presentation of this case fully stipulated does not
change this burden of proof. Rule 122; Borchers v. Commissioner,
95 T.C. 82, 91 (1990), affd. on another issue 943 F.2d 22 (8th
Cir. 1991).
15 We note that if petitioners' argument in this case were
accepted, a foster care provider could own and operate as a
business an unlimited number of "homes" for purposes of sec. 131.
There is certainly no mention of any desire to exempt the adult
home care business from tax, in either the express provisions of
sec. 131, or in the legislative history cited by the parties.
The requirement that the foster care provider must reside in his
or her "home" imposes some limit on the number of qualifying
homes a provider may own and operate, and is consistent with the
limitation of sec. 131(b)(3) on the number of adult care
recipients with respect to whom excludable payments can be made.
16 Welch v. Helvering, 290 U.S. 111 (1933); Rule 142(a). In
addition, exclusions from taxable income should be construed
narrowly, and taxpayers must bring themselves within the clear
scope of the exclusion. Graves v. Commissioner, 89 T.C. 49, 51
(1987), supplementing 88 T.C. 28 (1987).
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011