Penny J. Sutherland - Page 5




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          Sec. 32(c)(3)(B)(i).  An eligible foster child1 is defined as an            
          individual who the taxpayer cares for as his or her own child and           
          who has the same principal place of abode as the taxpayer for the           
          entire taxable year in issue.  See sec. 32(c)(3)(B)(iii).                   
               An individual satisfies the age test if he or she is under age         
          19 at the end of the taxable year, is a full-time student under age         
          24 at the end of the taxable year, or is permanently and totally            
          disabled during the taxable year.  See sec. 32(c)(3)(C).                    
               On the basis of the stipulated record, we conclude that for            
          1997 Christina and Mitchell were both petitioner’s and Mr. Pancake’s        
          qualifying children for purposes of the earned income credit.  Thus,        
          both petitioner and Mr. Pancake are eligible individuals (under             
          section 32(a)(1)) for purposes of claiming the earned income credit.        
               Section 32(c)(1)(C) provides a tie-breaker rule where there are        
          two or more eligible individuals with respect to the same qualifying        
          child for the same taxable year (as is the case here):                      
                    If 2 or more individuals would (but for this                      
               subparagraph and after application of subparagraph (B))                
               be treated as eligible individuals with respect to the                 
               same qualifying child for taxable years beginning in the               
               same calendar year, only the individual with the highest               
               modified adjusted gross income for such taxable years                  
               shall be treated as an eligible individual with respect                
               to such qualifying child. [Emphasis added.]                            


               1    Although Congress recently amended the definition of an           
          eligible foster child, see Ticket to Work and Work Incentives               
          Improvement Act of 1999, Pub. L. 106-170, sec. 412, 113 Stat.               
          1860, 1917, the amended definition does not apply herein because            
          it is effective only for tax years beginning after Dec. 31, 1999.           





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