41 T.C. 883">*883 Respondent has determined a deficiency in petitioner's income tax for the year 1959 in the amount of $ 188.71. The principal issue1964 U.S. Tax Ct. LEXIS 130">*131 for decision is whether petitioner furnished over half of the total support for her mother, Anna Bartsch, in the year 1959 thereby entitling petitioner to an exemption deduction for a dependent; a factor in determining this is whether the fair market value of the services the petitioner furnished her mother can be considered a part of her support. There is a second issue involving whether petitioner is entitled to head of household status. Respondent concedes that petitioner is entitled to head of household rates if she is entitled to a dependency exemption.

FINDINGS OF FACT

All facts contained in the stipulation filed by the parties are so found and made a part hereof.

The petitioner, Mildred Bartsch (hereinafter sometimes referred to as Mildred or petitioner), is unmarried and resides at 137 Orchard Avenue, Glenshaw, Pa. Mildred keeps her books and prepares her Federal income tax returns on a calendar year basis and a cash method of accounting.

Mildred reported in her Federal income tax return for 1959, filed with the district director of internal revenue, Pittsburgh, Pa., a taxable income of $ 4,635.36. This reported income represents salary from her employer, Aluminum Co. 1964 U.S. Tax Ct. LEXIS 130">*132 of America, and income from U.S. Government Series E bonds.

Mildred claimed her mother, Anna Bartsch, as a dependency exemption in her Federal income tax return for the year 1959. This was disallowed by the respondent.

During 1959, Anna received social security benefits in the amount of $ 707.50, all of which was spent in 1959. Mildred and Anna lived in a residence at 137 Orchard Avenue, Glenshaw, Pa. This residence was owned by Anna. The fair rental value of the residence for 1959 was $ 600. The value of lodging as an item of support of Anna for 1959 was $ 300. Anna also contributed lodging for the use of her daughter Mildred, the value of which was $ 300.

Real estate taxes on the home owned by Anna amounted to $ 151.63 in 1959. Certain repairs, including painting the gutters and repairing 41 T.C. 883">*884 the ceiling, amounting to $ 55 were made in 1959. Both the taxes and cost of repairs were paid for in the year 1959.

Anna's social security benefits were commingled with the funds of Mildred. There is no precise way of telling whether a particular expenditure was made from Anna's or Mildred's contributed funds, but the approximations are reasonable and practical.

The items of 1964 U.S. Tax Ct. LEXIS 130">*133 expense which were paid during the year out of the commingled funds of petitioner and her mother and the amounts applicable to the support of Anna are reflected in the following schedule:

Although petitioner had three brothers and three sisters, no one else lived with her and her mother or contributed to her mother's support.

Petitioner rendered personal services to her mother who was 79 years of age in 1959, and infirm. These services (for which petitioner was not compensated) included doing the laundry, ironing, marketing, most of the cooking, cleaning, mending, and, in effect, largely taking care of the entire household. The fair value of personal services by Mildred to Anna in 1959 was not less than1964 U.S. Tax Ct. LEXIS 130">*134 $ 884. Mildred checked by phone from work several times during the day to see how her mother was doing. Anna was left alone during the day while Mildred was at work. Mildred worked from 9:30 a.m. to 5:30 p.m. and did not go home for lunch.

Anna was nervous, excitable, and forgetful and her conduct was at times childish. She was not in a position to be left alone for long periods of time. She was not bedridden, however, and had vision good enough to enable her to move about the house. Anna prepared her 41 T.C. 883">*885 own lunch (usually from what was left over from the previous evening) and assisted to a minor extent in the preparation of meals consumed by both petitioner and herself. She did none of the cleaning or heavy work around the house, all of which was done by petitioner.

Some of petitioner's services to her mother were rendered in connection with performing the same tasks for herself, including marketing, ironing, and laundering services.

ULTIMATE FINDINGS OF FACT

Petitioner did not furnish more than half the total support of her mother, Anna Bartsch, in the year 1959.

OPINION

Section 151 of the Internal Revenue Code of 1954¹ allows a deduction for certain exemptions and1964 U.S. Tax Ct. LEXIS 130">*135 allows an exemption for dependents whose gross income (as defined in section 61) for the calendar year in which the taxable year of the taxpayer begins is less than $ 600. ² The definition of a dependent is set forth in section 152. Section 152(a) defines a dependent as any of enumerated individuals (including the mother of the petitioner) over half of whose support, for the calendar year in which the taxable year of the taxpayer begins, was received from the taxpayer.

The problem here is whether petitioner is entitled to add the value of her "services" to her mother to her out-of-pocket expenses in that regard. If she can do so under the statute, then the claimed mother dependent can be held to have received over half of her support from petitioner and petitioner can have the dependency exemption, 1964 U.S. Tax Ct. LEXIS 130">*136 and the head of a household status, as well.

We think this cannot be done and accordingly hold that Anna did not receive over half her support in the taxable year from the taxpayer, her daughter.

This is an intriguing question. By T.D. 6231, approved April 22, 1957, 1957-1 C.B. 77, the Treasury promulgated section 1.152-1 of the Income Tax Regulations which provided in part:

The term "support" includes food, shelter, clothing, medical and dental care, education, and the like. Generally, these items of support are measured in terms of the amount of expense incurred by the one furnishing such items. However, if the item of support furnished an individual (either by himself or others) is in the form of goods, services, or other benefits, it will be necessary to measure the amount of such items of support in terms of its fair market value. [Emphasis supplied.]

However, by T.D. 6304, approved August 19, 1958, 1958-2 C.B. 53, 41 T.C. 883">*886 the Treasury amended the above regulation by substituting for the last two sentences in the above quotation the following:

Generally, the amount of an item of support1964 U.S. Tax Ct. LEXIS 130">*137 will be the amount of expense incurred by the one furnishing such item. If the item of support furnished an individual is in the form of property or lodging, it will be necessary to measure the amount of such item of support in terms of its fair market value.

Thus, the reference to valuing services in determining the amount of support was deliberately deleted from the regulations.

In this connection it may be pointed out, though the legal effect is questionable, that in Index-Digest Supplement, I.R.S. Publication No. 401, promulgated August 1961 (covering matters appearing in Cumulative Bulletins from 1957 through 1960), it is stated:

The regulations have been amended to require that, in determining whether an individual qualifies as a dependent, items of support furnished him in the form of services must be measured by the amount of expenses actually incurred. If the item of support furnished an individual is in the form of property or lodging, it will be necessary to measure the amount of such item of support in terms of its fair market value. [Emphasis supplied.]

The year in issue is 1959 so the amended regulation referred to in T.D. 6304 was1964 U.S. Tax Ct. LEXIS 130">*138 in force. And we believe that the amended regulation is consonant with the law.

To use what has become a cliche: taxation is a practical matter. To hold here otherwise than we have, would be incredibly impractical. Taxpayer and her mother lived together in a home owned by the mother. Each performed household tasks commensurate with her physical capacities. Neither charged or collected from the other for such tasks on a monetary basis. Yet our taxpayer would have us place a value on what she "did" for her mother in order to claim her as a dependent. We attach no opprobrium to her claim; but we are reluctant to say, in the absence of specific statutory direction, and in the face of the equivocal regulatory history, that the taxpayer is entitled to her claim.

We find nothing in the statute requiring that such services as taxpayer rendered to her mother are to be "valued" in computing the "support" which she furnished her mother for dependency exemption purposes. Without clear statutory direction, it is beyond our comprehension why or how such services must be measured in the market place, or anywhere. How can a quantum meruit be put upon a daughter's care for an aged mother? 1964 U.S. Tax Ct. LEXIS 130">*139 Do we balance our judgment of such "value" against the "value" of the personal satisfaction which the daughter in this case receives in giving such care. And, if we do, would we not be required to set off against it the quid pro quo of the mother's quavering contribution to the household? One gives the services she needs to give, the other contributes her mite. The daughter might be able to sell such services in the market, the mother 41 T.C. 883">*887 probably could find no market. Does the statute require us to balance one against the other in determining the amount of support the mother receives? Suppose we take what must be a common situation, about the facts of which, of course, it can be said, "tra la, have nothing to do with [this] case"; i.e., the case of divorced parents where the wife has custody of the children and maintains a home for them. The cash outlays, plus lodging or property furnished by each parent are equal. Both claim dependency exemptions for the children. Who wins? Should the market value of the wife's T(ender) L(oving) C(are) for her children be thrown on the tax scales? We say no. The term "support" in the Code must mean something more than furnishing1964 U.S. Tax Ct. LEXIS 130">*140 the ordinary kindnesses and helpfulness and the cooking and the cleaning and the dishwashing that one able member of a household furnishes another less able. These things are not to be valued in the market for tax purposes. Support, as defined in the regulation, includes items such as food, shelter, etc., of which the amount will be "the amount of expense incurred by the one furnishing such item." Petitioner in this case has incurred no expense for furnishing the care ordinarily expected of a daughter for an aged mother (and that is all that is here involved) and we hold she cannot count the value of her personal services in computing whether she furnished "over half" of her mother's support.

Decision will be entered for the respondent.

Fisher, J., dissenting: The question here is whether the value of personal services rendered to a dependent is to be considered as support under Internal Revenue Code section 152. ³

1964 U.S. Tax Ct. LEXIS 130">*141 The majority's position is that personal services are not includable as part of a dependent's support unless there was an actual expense incurred therefor by the party furnishing the services, relying upon section 1.152-1(a)(2)(i)⁴ of respondent's present form of the Income Tax Regulations. I disagree with the construction the majority places upon the present form of respondent's regulations. The fact that reference to valuing services in determining the amount of support 41 T.C. 883">*888 was deliberately deleted by the respondent from his original regulations in no way forecloses the conclusion that such services are proper considerations in determining the support provided a dependent.

1964 U.S. Tax Ct. LEXIS 130">*142 To my mind, it is inconsistent in principle to allow the fair market value of lodging furnished an individual (as the regulations clearly do) but not the fair market value of related household services in determining the support provided the same individual. Why not include only the additional "cost" of such lodging?

In addition, I feel that the majority view tends to discriminate in favor of those who can afford to hire the services of others over the not-so-fortunate who can only provide time and effort and are thereby forced personally to provide the needed services.

I have no quarrel with the facts found by the majority. The focal issue is whether or not personal services are includable as part of dependent's support even though no actual cash expense was incurred therefor. The answer of the majority is "no." Since, as above indicated, my answer would be "yes," I feel that the issue should be projected by this dissent.