Decision will be entered for respondent in docket No. 15083-10, and an appropriate order will be entered in docket No. 6116-11.
In January 2007, in compliance with a State court order, P executed a Form 8332 ("Release of Claim to Exemption for Child of Divorced or Separated Parents"), which stated that "I agree not to claim an exemption for" her daughter S.S. as a dependent for the years at issue. However, P believed the State court order to be improper, so on her income tax returns for each of 2007 and 2008, P claimed a dependency exemption deduction and a child tax credit for S.S. P's former spouse also claimed S.S. as a dependent for those years and attached the executed Form 8332 to his tax returns.
139 T.C. 508">*509 GUSTAFSON,
Consistent with the principles of
Ms. George and Mr. Johnson John were married in 1988. They have two daughters, I.E. (born in 1988) and S.S. (born in 1992). Ms. George and Mr. John separated in July 1992; and on March 16, 1995, the Circuit Court for Prince George's County, Maryland (the "Maryland court"), granted an absolute divorce to Ms. George and Mr. John, which incorporated the terms of their previously executed separation agreement. The divorce judgment awarded custody of I.E. and S.S. to Ms. George, and ordered Mr. John to pay child support. The amount of child support Mr. John was required to pay could be reduced pursuant to a provision in the separation agreement related to health insurance. Under that provision, until Ms. George was able to obtain employer-provided health care coverage, Mr. John was required to provide health insurance 139 T.C. 508">*510 for Ms. George, I.E., and S.S. In exchange, Mr. John was then allowed to offset the cost of obtaining that insurance against his child support obligations, with a maximum offset of $200.
During the 2012 U.S. Tax Ct. LEXIS 46">*49 years at issue S.S. remained in the sole custody of Ms. George. S.S. did not provide most of her own support, and Ms. George does not contend that anyone other than herself and Mr. John provided S.S.'s support during the years at issue.32012 U.S. Tax Ct. LEXIS 46">*50 The divorce judgment did not expressly provide how or whether dependent status of the children would be allocated between Mr. John and Ms. George for tax purposes after the divorce.
In December 1995 Ms. George and her children moved to northern Virginia. By February 1996 Mr. John had apparently stopped fulfilling his support obligations; and, as a result, Ms. George initiated a child support action against him in Virginia.
Notwithstanding Ms. George's move to Virginia, one of the couple (we presume Mr. John) moved the Maryland court to modify the divorce judgment. On October 11, 1996, the Maryland court ordered that Mr. John could claim S.S. "as an exemption for Federal and State income tax purposes, each year, commencing with 1996 taxes, provided that all support payments are current". Even though Ms. George had argued that Mr. John was in arrears on child care payments and health insurance premiums for 1996, Ms. George complied with the court order. At the direction of the court, she signed in the courtroom on February 3, 1997, a Form 8332 ("Release of Claim to Exemption for Child of Divorced or Separated Parents"), thereby releasing her right to claim an exemption for S.S. for tax year 1996. Ms. George subsequently moved to dismiss the case from the Maryland court for lack of personal 2012 U.S. Tax Ct. LEXIS 46">*51 jurisdiction, since Mr. John had moved to Connecticut and Ms. George and the children lived in Virginia. On May 13, 139 T.C. 508">*511 1997, the Maryland court dismissed the case for lack of jurisdiction over the parties.
Ms. George and Mr. John filed subsequent motions in the Virginia court system to modify Mr. John's child support obligations. Generally, petitions to modify support obligations were initiated in the Juvenile and Domestic Relations District Court ("JDR district court"), and appeals therefrom were heard in a Virginia circuit court. However, on December 8, 2006, just before I.E. turned 18 years old, Mr. John filed not in the JDR district court but in the Circuit Court of Fairfax County, Virginia ("Fairfax County circuit court" or "circuit court") a motion styled "Motion to Modify Child Support, Etc.", in which Mr. John asked the Fairfax County circuit court to modify his child support obligation to require support only of S.S. The motion also asked the circuit court to require that Ms. George execute Form 8332 releasing her claim to exemption for S.S.
By order of January 5, 2007, the Fairfax County circuit court ordered that Ms. George execute Form 8332 releasing any tax exemption claim 2012 U.S. Tax Ct. LEXIS 46">*52 for S.S. for tax years 1996 to 2010 and amended Mr. John's child support obligation by releasing his obligation to support I.E. Ms. George alleges, and we assume, that Mr. John was in arrears on his child support obligation at the time the January 2007 court order was entered and that he continued to be in arrears thereafter. Nonetheless, on January 5, 2007, pursuant to the court order and under threat of contempt, Ms. George executed another Form 8332 relinquishing her claim to exemption for S.S.--this time for the tax years 1996 to 2010. The form stated: "I agree not to claim an exemption for" S.S.
Ms. George contends that the Fairfax County circuit court erred by failing to consider whether Mr. John was in arrears when it ordered her to execute the Form 8332; moreover, she contends that the circuit court did not have jurisdiction to modify the child support order (and that the JDR district court was instead the proper venue). Accordingly, Ms. George moved the Fairfax County circuit court to reconsider its order, but her motion was denied. On April 10, 2007, Ms. George appealed the order to the Virginia Court of Appeals. On January 30, 2008, the Virginia Court of Appeals dismissed 2012 U.S. Tax Ct. LEXIS 46">*53 Ms. George's case for failure to file an opening brief. Ms. George's State court battle against the January 2007 139 T.C. 508">*512 order requiring her to sign the Form 8332 has continued in JDR district courts and is apparently still ongoing.
Ms. George timely filed a Form 1040, U.S. Individual Income Tax Return, for each of the tax years 2007 and 2008. On both returns Ms. George claimed dependency exemption deductions for S.S. and I.E., claimed head of household status, and claimed child tax credits for S.S. Mr. John also filed Form 1040 returns for 2007 and 2008 to which he attached the Form 8332 that Ms. George had signed on January 5, 2007. On those returns Mr. John claimed dependency exemption deductions for S.S.
The IRS issued to Ms. George notices of deficiency for tax years 2007 (on April 5, 2010) and 2008 (on December 13, 2010). In those notices the IRS determined that Ms. George was not entitled to a dependency exemption deduction or a child tax credit for S.S. for tax year 2007 or 2008. The IRS also determined that for 2008 Ms. George had not established she was entitled to a dependency exemption deduction for I.E. or to head of household filing status.
Ms. George filed timely petitions 2012 U.S. Tax Ct. LEXIS 46">*54 with this Court seeking redetermination of the deficiencies that the IRS had determined. The Commissioner has moved for partial summary judgment as to Ms. George's claim of a dependency exemption deduction and a child tax credit for S.S.
Under
An individual is allowed a deduction for an exemption for "each individual who is a dependent (as defined in
However, in the case of divorced parents, special rules determine which one42012 U.S. Tax Ct. LEXIS 46">*56 may claim a dependency exemption deduction for a child.
For these purposes Ms. George is S.S.'s custodial parent and Mr. John is S.S.'s noncustodial parent, because the absolute divorce judgment gave Ms. George sole custody of S.S. 139 T.C. 508">*514 • The "child receives over one-half of the child's support during the calendar year from the child's parents * * * who are divorced * * * under a decree of divorce", • such child was "in the custody of 1 or both of the child's parents for more than one-half of the calendar year", • "the custodial parent signs a written declaration (in such manner and form as the Secretary may by regulations prescribe) that such custodial parent will not claim such child as a dependent for any taxable year beginning in such calendar year", • "the noncustodial parent attaches such written declaration to the noncustodial parent's return" for the appropriate taxable year,
The written declaration that the Commissioner relies on here is the Form 8332 that the Fairfax County circuit court required Ms. George to sign in January 2007. On that Form 8332, Ms. George straightforwardly declared that she would not claim S.S. as a dependent for years that included 2007 and 2012 U.S. Tax Ct. LEXIS 46">*58 2008. The properly executed Form 8332 was attached to Mr. John's 2007 and 2008 returns, indicating that he was entitled to claim S.S. Under the terms of
Ms. George appears to contend that her Form 8332 should be disregarded for three related reasons--i.e., because 2012 U.S. Tax Ct. LEXIS 46">*59 she signed it under compulsion, because the order requiring her to sign it was erroneous, and because her former husband 139 T.C. 508">*515 did not provide the child support that the court order required and presumed.
Ms. George contends that we should disregard the release because she signed it under compulsion and not freely. However, the facts she alleges--i.e., the threat of judicial contempt if she did not comply and sign--cannot be considered "duress" that might make her signing void. Duress occurs when "an unlawful act" induces action,
Ms. George contends that the Fairfax County circuit court order that required her to sign the Form 8332 for tax years 139 T.C. 508">*516 1996 to 2010 was in error, both because that court lacked jurisdiction to issue such an order and because any such order should have taken into account her former husband's past arrears in child support before enabling him to obtain the dependency exemption for S.S. She contends that once a State appellate court corrects this wrong, she will be able to revoke her signature from the Form 8332. Ms. George did appeal the order, but her appeal was dismissed for failure to file an opening brief. In the absence of any correction of the order by a State appellate court, Ms. George collaterally attacks the State court order here, in effect asking us to hold that the order is incorrect and that her release on Form 8332 is therefore invalid.
However, we cannot rely on this uncorrected supposed error to invalidate 2012 U.S. Tax Ct. LEXIS 46">*62 Ms. George's release on Form 8332, for two reasons: First, we lack the power to grant this remedy. If the State court did err by ordering Ms. George to do something that legally she should not have been required to do, then her remedy is not found in the U.S. Tax Court but rather in an appeal to the State appellate court. The Tax Court's jurisdiction is circumscribed by statute, Congress added this written declaration requirement to
Ms. George asserts that, in the years after she executed the release, Mr. John has continued to fail in his obligations of financial support by offsetting more than his actual cost of providing health insurance for S.S. and I.E. (which Ms. George contends was nothing because Mr. John had remarried, and, as a result, already had family health insurance coverage). We infer that she thereby contends that, since she has not benefited from the support provisions of the court order, she ought not to suffer the detriment of the release it required. Or, to look at it from Mr. John's perspective, since he has allegedly failed to maintain his
139 T.C. 508">*518 If we accepted * * * [the custodial parent's] statement of the issue, we would find ourselves in the middle of a child support fight similar to that which Congress intended to remove from the Federal courts when it amended
As we recently observed in Congress created several objective tests in
A taxpayer is entitled to a child tax credit for "each qualifying child", as defined in
Since there is no genuine dispute as 2012 U.S. Tax Ct. LEXIS 46">*68 to any material fact, and under
1. Unless otherwise indicated, all citations of sections refer to the Internal Revenue Code of 1986 (26 U.S.C.) in effect for the tax year at issue, and all citations of Rules refer to the Tax Court Rules of Practice and Procedure.↩
2. In order to protect their privacy, we refer to Ms. George's children by their initials.
3. If a third party (not the child or her parents) provides most of a child's support, then--notwithstanding a purported release by the custodial parent under
4. Ms. George does not contend that two divorced parents could each be entitled to a dependency exemption deduction for the same child, and it is clear that they could not be. In general,
5. Accordingly, we are not faced with the question of, nor do we decide, the effect of an executed Form 8332 if one of the other necessary elements for the noncustodial parent's claim in
6. For tax years beginning after July 2, 2008, regulations were promulgated that set forth a procedure to revoke a prior-executed Form 8332.
7. "[I]f an act of one party deprives another of his freedom of will to do or not to do a specific act the party so coerced becomes subject to the will of the other, there is duress, and in such a situation no act of the coerced person is voluntary and contracts made in such circumstances are void because there has been no voluntary meeting of the minds of the parties thereto."
8. Ms. George's release on Form 8332 was unconditional, and these cases do not involve a conditional release on a substitute for Form 8332.
