Richard J. Sarni and Susan Sarni - Page 6

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          Netherlands during 2000.  Therefore, S.G. fails the citizenship             
          or residency test under section 152(b)(3).                                  
               We hold that petitioners are not entitled to claim a                   
          dependency exemption deduction for S.G. for 2000.  Accordingly,             
          respondent’s determination on this issue is sustained.                      
          B.  Child Tax Credit                                                        
               Section 24(a) provides that a taxpayer may claim a credit              
          for “each qualifying child”.  A qualifying child is defined,                
          inter alia, as any individual if “the taxpayer is allowed a                 
          deduction under section 151 with respect to such individual for             
          the taxable year”.  Sec. 24(c)(1)(A).                                       
               For the reasons stated in paragraph A, supra p. 4,                     
          petitioners may not claim a dependency exemption deduction for              
          S.G. under section 151.  Therefore, they may not claim a child              
          tax credit for him.  Respondent’s determination on this issue is            
          sustained.                                                                  
          C.  Period of Assessment                                                    
               Petitioners contend that respondent “delayed in notifying              
          petitioner that the dependency exemption for * * * [S.G.] for               
          taxable year 2000 was disallowed.”  Petitioners appear to argue             
          that respondent issued the notice of deficiency beyond the                  
          statute of limitations on assessment.  See sec. 6501(a).                    
               Generally, an income tax must be assessed within 3 years               
          after the applicable return is filed (whether or not such return            
          was filed on or after the date prescribed).  Sec. 6501(a).  The             





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