Florence C. Blankson - Page 21




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          includes as a member one or more qualifying individuals.  The               
          term “qualifying individual,” under section 21(b)(1), includes a            
          dependent of the taxpayer under age 13, with respect to whom the            
          taxpayer is entitled to a dependency deduction under section                
          151(c).  The allowable credit, under section 21(b)(2), is based             
          upon employment-related expenses that are incurred to enable the            
          taxpayer to be gainfully employed, including expenses incurred              
          for the care of a qualifying individual.  Respondent does not               
          dispute that petitioner’s daughter was a “qualifying individual”            
          under section 21(b)(1), or that petitioner’s payments to Kuddle             
          Korner, if actually paid, were employment related under section             
          21(b)(2).  Respondent contends, however, that petitioner failed             
          to substantiate payments made during 1995 for the care of Clara             
          while petitioner and her husband were working.                              
               Petitioner claimed the expenses paid to Kuddle Korner and              
          provided identifying information with respect to that service               
          provider on her 1995 return pursuant to section 21(e)(9).                   
          Petitioner did not substantiate these child care expenses with              
          written records but testified credibly about the expense.  See              
          sec. 1.44A-1(e), Income Tax Regs. (taxpayer must substantiate               
          credit by adequate records or other sufficient evidence).  The              
          Court is satisfied from the record that petitioner did incur                
          child care expenses with respect to a qualifying individual, her            
          daughter, Clara.  In the absence of adequate substantiation, this           





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