Ann M. Wilson - Page 5

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          Indiana and California (estimated at $400 per round trip), sent             
          her money throughout the school year, and bought her clothing.              
          Petitioner was not required to pay rent to her parents for RW’s             
          living arrangements, but she did send money to her parents on               
          occasion.                                                                   
               In April 2002, petitioner completed a financial aid form for           
          RW’s tuition.  On the form, petitioner indicated that she was               
          RW’s noncustodial parent and that RW’s father claimed RW as a               
          dependent for tax year 2002.  Petitioner listed Mr. Wilson as the           
          person allowed to claim the dependency exemption deduction                  
          because the IRS had advised her in past years that Mr. Wilson had           
          claimed RW and she assumed that Mr. Wilson would continue to                
          claim RW as a dependent.  Petitioner identified herself as the              
          noncustodial parent because she lived in California and RW’s                
          school was in Indiana.                                                      
               Petitioner timely filed a Form 1040, U.S. Individual Income            
          Tax Return, for the taxable year 2002, as a head of household and           
          claimed an earned income credit.  As previously indicated,                  
          petitioner did not claim RW as a dependent; however, Mr. Wilson             
          did claim RW as a dependent on his 2002 return.3                            

               3 During the trial petitioner appeared to question whether             
          in fact she might be entitled to the dependency exemption for RW.           
          It is not entirely clear whether petitioner intended to place the           
          dependency exemption in issue.  Assuming that it was in issue, we           
          would conclude, on the basis of this record, that petitioner was            
          not entitled to a dependency exemption deduction for RW.  The               
                                                             (continued...)           





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