- 5 - their income. Sec. 86(a) through (c). The portion included in income, never exceeding 85 percent, varies according to a formula set forth in section 86(a). This formula uses variables known as “base amount” and “adjusted base amount”, which are defined under section 86(c). Under the general rule, the former is $25,000 and the latter is $34,000. Sec. 86(c)(1)(A) and (2)(A). However, with respect to a married taxpayer who does not file a joint return and who “does not live apart from his spouse at all times during the taxable year,” both of these amounts are zero. Sec. 86(c)(1)(C) and (2)(C). Respondent argues that petitioner lived with his wife for a portion of 1997, causing the benefits he received to fall under the special rule of section 86(c)(1)(C) and (2)(C). To this effect, respondent asserts that petitioner admitted prior to trial that he had lived with her for a few days in 1997. Petitioner denies making such an admission. He testified at trial that he returned to California on 2 days in connection with a workers’ compensation issue, but that he did not “live” with his spouse during that period. No evidence was admitted of an admission by petitioner or which otherwise contradicts petitioner’s testimony. We accept petitioner’s testimony and have found, as detailed above, that petitioner and his wife lived 4(...continued) joint return, and who do not live apart from their spouses at all times during the year. Sec. 86(c)(1).Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011