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income in the amount of $2,223.97, consisting of wages in the
amount of $2,197.66 and taxable interest income in the amount of
$26.31. Although petitioner reported no tax liability (because
of the availability of a personal exemption and the standard
deduction), petitioner claimed an earned income credit in the
amount of $170.
After examining petitioner’s return, respondent issued a
notice of deficiency. In the notice, respondent determined that
petitioner was not entitled to an earned income credit because he
received wages while in a penal institution. Thereafter,
petitioner invoked the Court's jurisdiction by filing a timely
petition for redetermination.
Prior to trial, respondent moved for summary judgment.
Relying on section 32(c)(2)(B)(iv) and Taylor v. Commissioner,
T.C. Memo. 1998-401, respondent contends that petitioner is not
entitled to an earned income credit because he was incarcerated
throughout the year in issue.
Petitioner also moved for summary judgment prior to trial.
Petitioner contends that he is entitled to the earned income
credit because Pre-Stressed Casting is a private-sector company
which paid him wages for work performed outside the Ozark
Correctional Center.
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