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was receiving some type of financial assistance from the
Government. Petitioner did not know whether the fathers of the
children were paying any child support. Petitioner testified
that his brother "was actually responsible for all of us" and
that "he was the one that would make more money than everyone".
The rent for the three bedroom house was $1,300 per month.
Petitioner paid $400 of the $1,300 payments. Each week
petitioner and his brother would spend about $200 on food. Of
that amount petitioner would pay at least $50 a week. Petitioner
would buy the children clothes when he would get spare money.
Petitioner did not know how much it cost in total to support
Melissa and Omar in 1998.
On his 1998 tax return, petitioner claimed Melissa and Omar
as dependents and listed them as foster children. Petitioner
also filed as head of household and claimed his niece and nephew
for the child care credit, the child tax credit, and the earned
income credit.
Respondent determined that petitioner was not entitled to
claim his niece and nephew as dependents, that his filing status
was single rather than head-of-household, and that he was not
entitled to the child care, child tax, and earned income credits.
Section 151 allows a taxpayer to deduct an annual exemption
amount for each dependent, as defined in section 152. Section
152(a) provides, in pertinent part, that a dependent includes an
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