Ms. Petrie and the three dependent children moved from the family residence to the Arizona rental property in March 1992. ³ At that time, petitioner took possession of the family residence. After regaining possession of the family residence, petitioner first timely filed a 1991 joint Federal return and in May 1992 filed an unsigned 1990 joint Federal return. ⁴

1995 Tax Ct. Memo LEXIS 596">*601 The 1990 joint Federal return claimed married filing jointly filing status, claimed a personal exemption for petitioner, an exemption for Ms. Petrie and three dependency exemptions. The 1990 joint Federal return reported petitioner's W-2 income, Ms. Petrie's Form W-2 income in the amount of $ 345.55, petitioner's AT&T retirement income in the amount of $ 20,408, ⁵ a taxable IRA distribution, 100 percent of the Arizona rental property income in the amount of $ 5,500, and 100 percent of the Arizona rental property expenses in the amount of $ 3,799. ⁶ When he filed his 1990 joint Federal return, petitioner paid taxes in the amount of $ 2,077, and estimated interest on late filing of $ 1,000 and disclosed his former spouse's failure to sign the return.

1995 Tax Ct. Memo LEXIS 596">*602 Petitioner later filed an amended 1990 Federal return in which he claimed head of household filing status, omitted the exemption amount for Ms. Petrie, omitted Ms. Petrie's Form W-2 income, and excluded the Arizona rental property income.

The notice of deficiency, based on petitioner's 1990 joint Federal return, changed petitioner's filing status to married filing separately, disallowed the exemption for Ms. Petrie, reduced petitioner's rental income by $ 2,750, ⁷ and disallowed $ 2,629 of petitioner's rental expenses.

For 1991, petitioner initially timely filed a joint Federal return and claimed exemptions for himself and Ms. Petrie and three dependency exemptions. The 1991 joint Federal return reported petitioner's W-2 income, petitioner's AT&T retirement income, 100 percent of the income from the Arizona rental property in the amount of $ 6,000, and Arizona rental property expenses of $ 4,608. ⁸

1995 Tax Ct. Memo LEXIS 596">*603 Petitioner amended his 1991 joint Federal return in which he claimed head of household filing status, omitted the exemption amount for Ms. Petrie, and excluded the Arizona rental property income.

The notice of deficiency, based on the 1991 joint Federal return disallowed the exemption amount for Ms. Petrie, reduced petitioner's reported rental income by $ 3,000 ⁹ and disallowed $ 2,304 ¹⁰ of petitioner's rental expense.

The first issue for decision is whether petitioner is entitled to use head of household filing status ¹¹ for the years in issue. Petitioner contends that he is entitled to claim head of household filing status as claimed on his 1990 and 1991 amended returns. Respondent contends that petitioner was married during the years in issue and because Ms. Petrie did not join in the filing of the returns, petitioner must claim married filing separately1995 Tax Ct. Memo LEXIS 596">*604 filing status.

Section 1 imposes a tax on the taxable income of individuals. The rate of tax depends on the taxpayer's filing status. Sec. 1(a) through (d). There are four filing categories for individual taxpayers: (1) Married filing a joint return; (2) unmarried head of household; (3) unmarried individual; and (4) married filing a separate return.

The marginal tax rates are lowest for married individuals filing jointly and they progressively increase for each category as follows: Head of household, individual, and married filing separately.

The threshold issue in determining filing status is to determine marital status. Marital1995 Tax Ct. Memo LEXIS 596">*605 status for purposes of filing a joint or separate return is determined under section 7703.

Under section 7703(a), a taxpayer who is "married" may be considered unmarried for tax purposes, if he is legally separated under a decree of divorce or separate maintenance or meets the requirements of section 7703(b). ¹²

An individual is considered legally separated under a decree of divorce or separate maintenance if the decree "expressly and affirmatively provides that the parties live apart in the future". Capodanno v. Commissioner, 69 T.C. 638">69 T.C. 638, 69 T.C. 638">646 (1978), affd. 602 F.2d 64">602 F.2d 64 (3d Cir. 1979) (quoting Boettiger v. Commissioner, 31 T.C. 477">31 T.C. 477, 31 T.C. 477">483 (1958)). A decree of support or temporary alimony1995 Tax Ct. Memo LEXIS 596">*606 which does not require separation is not considered a decree of divorce or separate maintenance within the meaning of section 7703(a). Dunn v. Commissioner, 70 T.C. 361">70 T.C. 361 (1978), affd. without published opinion 607 F.2d 995">607 F.2d 995 (2d Cir. 1979).

Petitioner separated from Ms. Petrie on January 5, 1991. At the close of the 1990 tax year petitioner was married, lived with his former wife in the family residence, and does not qualify for head of household filing status.

Petitioner was separated from Ms. Petrie at the close of the 1991 tax year. First, we must consider whether the Temporary Orders constitute a decree of separate maintenance for purposes of section 7703. The Temporary Orders failed to provide that petitioner and Ms. Petrie live apart. The Temporary Orders constitute a temporary decree for support which does not satisfy the requirement that the parties be legally separated under a decree of divorce or separate maintenance. 70 T.C. 361">Dunn v. Commissioner, supra.

Secondly, petitioner did not maintain as his household a principal place of abode for a dependent child and accordingly does not meet1995 Tax Ct. Memo LEXIS 596">*607 the requirements of section 7703(b). Therefore, for 1991, petitioner was married for purposes of section 7703 and is not entitled to claim head of household filing status. Accordingly, respondent is sustained on this issue.

The second issue for decision is whether petitioner may claim a mortgage interest expense for 1990. Petitioner contends that he is entitled to a mortgage interest deduction for the interest paid on the Arizona rental property. Respondent contends that petitioner was unable to substantiate the mortgage interest deduction.

Interest on a mortgage on real estate is deductible. Sec. 163. Where mortgaged property is jointly owned and the co-owners are jointly liable on the mortgage each owner is entitled to a deduction for the mortgage interest that he actually pays out of his own funds. Castaneda-Benitez v. Commissioner, T.C. Memo. 1981-157.

Section 6001 and the regulations promulgated thereunder require a taxpayer to maintain adequate records to substantiate the claimed deductions. However, if certain claimed deductions are not substantiated, we are permitted to estimate them when we are convinced from the record that the taxpayer 1995 Tax Ct. Memo LEXIS 596">*608 has incurred such expense and we have a basis upon which to make an estimate. Cohan v. Commissioner, 39 F.2d 540">39 F.2d 540 (2d Cir. 1930); Vanicek v. Commissioner, 85 T.C. 731">85 T.C. 731, 85 T.C. 731">743 (1985).

Petitioner testified that he paid $ 1,575 of mortgage interest expense on the Arizona rental property for 1990.

For 1990, the record shows that petitioner's funds were used to make the mortgage payments. Further, the Temporary and Final Orders required petitioner to continue to make the mortgage payments on the Arizona rental property of approximately $ 340 a month. We further note that Ms. Petrie assumed the outstanding mortgage in 1992. We are convinced from the record that there was an outstanding mortgage on the Arizona rental property in 1990, and that petitioner made the mortgage payments. Accordingly, we find that petitioner is entitled to a mortgage interest deduction for 1990 on Schedule E for the mortgage interest paid by him in the amount of $ 1,575. 39 F.2d 540">Cohan v. Commissioner, supra.(See discussion of mortgage interest deductions by co-owners of real property infra pp. 11-12.)

The third issue for1995 Tax Ct. Memo LEXIS 596">*609 decision is whether petitioner had additional rental income and is entitled to claim additional rental expenses for 1991. Petitioner contends he should be permitted to exclude the rental income on his 1991 return and is entitled to claim the rental expenses because the Temporary Orders mandated such treatment. Respondent contends that petitioner must report his share of the income and expenses. ¹³

Income with respect to joint tenancy property is allocated and taxed in proportion to that which each co-owner is entitled to receive under local law. Parsons v. Commissioner, 43 T.C. 378">43 T.C. 378 (1964). A co-tenancy under Colorado law provides that each of two joint tenants owns an undivided one-half interest in the property as a whole. Commercial Factors v. Clarke & Waggener, 684 P.2d 261">684 P.2d 261 (Colo. Ct. App. 1984).1995 Tax Ct. Memo LEXIS 596">*610

However, co-owners are entitled to a deduction for mortgage interest and real estate taxes paid on jointly-owned property to the extent that they have actually paid these amounts and provided that no other tenant has previously claimed a deduction therefor. Blackburn v. Commissioner, T.C. Memo. 1979-266, affd. 681 F.2d 461">681 F.2d 461 (6th Cir. 1982); Finney v. Commissioner, T.C. Memo. 1976-329. The reason for treating interest and taxes differently from other types of expenses and losses is that even though a co-owner may not be personally liable for the entire amount of the interest and taxes, payment may be necessary to preserve that co-owner's rights in the entire property. Powell v. Commissioner, T.C. Memo. 1967-32.

For the first 3 months of 1991, petitioner was entitled to receive one-half of the rental income from the Arizona rental property as a co-owner. Pursuant to the Uniform Dissolution of Marriage Act, Colo. Rev. Stat. sec. 14-10-114 (1987), the Temporary Orders awarded Ms. Petrie the $ 600 monthly rental income from the Arizona property subsequent to March 21, 1995 Tax Ct. Memo LEXIS 596">*611 1991. Under Colorado law, the right to income from real property is an incident of ownership and the award thereof is not an award of alimony. McDonald v. McDonald, 150 Colo. 492">150 Colo. 492, 374 P.2d 690">374 P.2d 690 (1962). The $ 600 monthly rental income awarded to Ms. Petrie also was not child support because the Temporary Orders specifically provided that petitioner was to pay $ 960 per month as child support.

Petitioner, therefore, must include in his 1991 income, one-half of the Arizona rental income for the first 3 months of 1991 ($ 900). 43 T.C. 378">Parsons v. Commissioner, supra; 684 P.2d 261">Commercial Factors v. Clarke & Waggener, supra. He is not required to include in his 1991 income any portion of the Arizona rental income awarded to Ms. Petrie for the period April through December 1991.

Petitioner testified that pursuant to the Temporary Orders, he paid the mortgage interest and real estate taxes on the Arizona rental property. The record supports petitioner's testimony, and we find petitioner to have been a credible witness.

The mortgage interest and real estate taxes are contained in the mortgage1995 Tax Ct. Memo LEXIS 596">*612 payments. Therefore we are convinced from the record that petitioner made the mortgage interest and real estate taxes payments. 39 F.2d 540">Cohan v. Commissioner, supra.Petitioner is therefore entitled to a deduction for mortgage interest in the amount of $ 1,530 and real estate taxes of $ 790, totaling $ 2,320. Blackburn v. Commissioner, supra.

With respect to the Arizona rental property expenses, other than the mortgage interest and real estate taxes, petitioner is entitled to a deduction for one-half of those amounts totaling $ 1,145. ¹⁴Estate of Boyd v. Commissioner, 28 T.C. 564">28 T.C. 564 (1957).

Next, we must consider whether petitioner may reduce his income by one-half of his retirement income. On his 1990 and 1991 returns, petitioner reported $ 20,408.25 and $ 22,198.40 of retirement income. At trial, 1995 Tax Ct. Memo LEXIS 596">*613 petitioner raised the issue of whether he may reduce his gross income for 1990 and 1991 by one-half of his AT&T retirement income. Petitioner contends that because his AT&T retirement income was considered marital property by the Final Orders entered in 1992 and his former spouse was ultimately awarded one-half of his AT&T retirement benefits commencing with the monthly payments made on or after March 1, 1992, he should be taxed on only one-half of the retirement benefits that he received during 1990 and 1991. Respondent contends that petitioner received all the AT&T retirement income during the years in issue and must report the full amount.

Section 61(a) provides that gross income includes all income from whatever source derived, unless excludable by a specific provision of the Code. Respondent's determinations in the statutory notice of deficiency are presumed to be correct, and the taxpayer has the burden of proving otherwise. Rule 142(a); Helvering v. Taylor, 293 U.S. 507">293 U.S. 507 (1935); Welch v. Helvering, 290 U.S. 111">290 U.S. 111 (1933). Exemptions from gross income, having been specifically stated, should be construed with restraint. 1995 Tax Ct. Memo LEXIS 596">*614 Commissioner v. Jacobson, 336 U.S. 28">336 U.S. 28, 336 U.S. 28">49 (1949); Hagar v. Commissioner, 43 T.C. 468">43 T.C. 468, 43 T.C. 468">484 (1965).

The Final Order directed that Ms. Petrie receive one-half of petitioner's AT&T retirement benefits commencing March 1, 1992. Prior to March 1, 1992, petitioner received the AT&T retirement income directly and made payments pursuant to the Temporary and Final Orders. Petitioner received 100 percent of the AT&T retirement benefits during the years in issue and must report the full amount unless otherwise excluded. Sec. 61(a). There is no basis for exclusion. Rule 142(a).

Petitioner's argument that Colorado is a community property State is incorrect. In re Marriage of Ellis, 36 Colo. App. 234 (1975), affd. 191 Colo. 317">191 Colo. 317 (1976), 538 P.2d 1347">538 P.2d 1347 and 552 P.2d 506">552 P.2d 506. Petitioner is not entitled to reduce his AT&T retirement income by the one-half amount ultimately awarded to Ms. Petrie. Cook v. Commissioner, 80 T.C. 512">80 T.C. 512, 80 T.C. 512">518-19 (1983), affd. without published opinion 742 F.2d 1431">742 F.2d 1431 (2d Cir. 1984).1995 Tax Ct. Memo LEXIS 596">*615 Accordingly, respondent is sustained on this issue.

The final issue for decision is whether petitioner is liable for the addition to tax imposed pursuant to section 6651(a)(1) for failure to file a timely 1990 return. Section 6651(a)(1) imposes an addition to tax for failure to timely file a return, unless the taxpayer establishes: (1) The failure did not result from "willful neglect"; and (2) the failure was "due to reasonable cause". "Willful neglect" has been interpreted to mean a conscious, intentional failure, or reckless indifference. United States v. Boyle, 469 U.S. 241">469 U.S. 241, 469 U.S. 241">245-246 (1985). "Reasonable cause" requires the taxpayer to demonstrate that he exercised ordinary business care and prudence and was nonetheless unable to file a return within the prescribed time. 469 U.S. 241">United States v. Boyle, supra at 246; sec. 301.6651-1(c)(1), Proced. & Admin. Regs. The addition to tax equals 5 percent of the tax required to be shown on the return for the first month, with an additional 5 percent for each additional month or fraction of a month during which the failure to file continues, not to exceed a maximum of 25 percent. 1995 Tax Ct. Memo LEXIS 596">*616 Sec. 6651(a)(1).

Petitioner testified that 1990 was the first time he had filed a late return. Petitioner testified that he was in the middle of a divorce and did not have access to the premises or his tax records until March of 1992. Petitioner testified that his Form W-2 went to the family residence which was in the exclusive possession of his former spouse.

Petitioner testified "I did everything I could to get it done" and that he was precluded from filing a timely 1990 return because he did not have access to the family residence or his records until March 1992. We find that petitioner failed to exercise ordinary business care in timely filing his 1990 return. Petitioner could have requested a duplicate Form W-2 in order to timely file his 1990 return but failed to do so.

Accordingly, we find petitioner is liable for the addition to tax pursuant to section 6651(a)(1).

To reflect the foregoing,

Decision will be entered under Rule 155.