Sally Kirshenbaum, Petitioner

Sws(cid:127) S7t" g T .C . Summary Opinion 2009-17 9

UNITED STATES TAX COUR T

SALLY KIRSHENBAUM, Petitioner v . COMMISSIONER OF INTERNAL REVENUE, Responden t } Docket No . 13022-08S . Filed December 1, 2009 .

Sally Kirshenbaum, pro se .

Louise R . Forbes , for respondent .

ARMEN, Special Trial Judge :, This caste was heard pursuant to the provisions of section 7463 of the Internal Revenue Code in effect when the petition was filed .' Pursuant to section 7463(b), the decision to be entered is not reviewable by an y ' Unless otherwise indicated, all subsequent section references are to the Internal Revenue Code in effect for the year in issue, and all Rule references are to the Tax Court Rules of Practice and Procedure .

SERVED Dec 01 2009 1\ 2 - other court, and this opinion shall not be treated as precedent for any other case .

Respondent determined a deficiency in petitioner's Federal income tax for 2002 of $13,124, as well as an addition to tax under section 6651(a)(1) of $2,229 .97, an addition to tax under section 6651(a)(2) of $2,477 .75, and an addition to tax under section 6654 of $319 .24 .

Respondent conceded the addition to tax under section 6654 ; thus, the issues for decision are :

(1) Whether petitioner may file a joint tax return with her husband ; (2) whether petitioner is entitled to two dependency exemption deductions ; (3) whether petitioner is liable for the addition to tax for failure to timely file under section 6651(a)(1) ; an d (4) whether petitioner is liable for the addition to tax for failure to pay under section 6651(a)(2) .

Background All of the facts have been stipulated, and they are so found .' We incorporate by reference the parties' stipulation of facts and accompanying exhibits .

Petitioner resided in the State of Rhode Island when the petition was filed . At all relevant times, petitioner has been married and has resided with her spouse .

f For 2002, the taxable year in issue, petitioner did not file a request for an extension of time for filing a return, see sec .j 6081(a), nor_ did petitioner, timely file a return, see sec .

6072 (a) .

For 2002 petitioner's husband filed a' .Form 1040, U .S .

Individual Income Tax Return, with the filing status of single on August 9, 2004 . Petitioner's husband claimed the standard deduction and a personal exemption on~thatlreturn . Petitioner had no knowledge of that return .

On November 19, 2007, respondent prepared a substitute for, .

return under section 6020(b) . Thereafter,ion February 25, 2008,^ respondent sent petitioner a-notice of deficiency . Respondent's deficiency' determination was principally attributable t o petitioner's failure to . report wages and . interest of $70,991 .

Respondent'allowed petitioner a personal exemption,for herself and the standard deduction and accorded her the filing status of single .

After receiving the notice of,deficiency for 2002, petitioner, on April 7, 2008, submitted toirespondent a Form 104 0 claiming the filing status of married filing jointly . Petitioner claimed itemized deductions and dependency'exemption/deductions .

for her daughter and father on this return'. Respondent did no t accept this return because it was a joint return .

4 - On May 28, 2008, petitioner timely filed a petition with the Court for redetermination of the deficiency . In the petition, petitioner stated that her husband handled the family finances and had fallen ill in 2002 . Petitioner stated she was willing'to pay the tax due, but prayed for relief from the additions to tax .

A .

Burden of Proo f Discussio n We begin by noting that the submission of a case fully stipulated does not alter the burden of proof, the requirements otherwise applicable with respect to adducing proof, or th e effect o .fffailure of proof . Rule 122(b) .

As a general rule, the Commissioner's determinations are presumed correct, and the taxpayer bears the burden of proving that those determinations are erroneous. Rule 142(a) ; INDOPCO, Inc . v . Commissioner , 503 U .S . 79, 84 (1992) ; Welch v . Helvering , 290 U .S . 111, 115 (1933) . Under section 7491(a)(1), the burden of proof may shift from the taxpayer to the Commissioner if the taxpayer produces credible evidence with respect to any factual issue relevant to ascertaining the taxpayer's liability .

Petitioner has not alleged that section 7491 applies, nor did she introduce the requisite evidence to invoke that section ; therefore, the burden of proof remains on petitioner .

Section 7491(c) provides that the Commissioner bears the burden of production with respect to an addition to tax . To meet this burden, the Commissioner must introduce evidence indicatin g that it is appropriate to impose the relevant addition to tax .

Higbee v .' Commissioner , ' 116 T . C . 438 , 446 (2001 ) .

Once the Commissioner meets this burden , the taxpayer bears the burden t o I.

produce evidence regarding reasonable cause .

Id . at 446-447 .

s Respondent has met his burden .

E .g ., Cabitac v . Commissioner , 120 T . C . 163 , 170-173 ( 2003) .

Further , deductions and credits are a matter of legislativ e grace, and the taxpayer bears the burden of proving that he or she is entitled to any deduction or credit ; claimed . Rule'142(a) ; Deputy v . du Pont , 308 U .S . 488, 493 ( .1940) ; New Colonial Ice Co .

v . Helvering , 292 U .S . 435, 440 (1934) .

B .

Joint Tax Return In general, section 6013(a) entitles married taxpayers t o make a joint income tax return . Section 6013(b)(1) further provides as a general rule that even where!a taxpayer has' filed a separate return for a taxable year and the ; time prescribed for fi filing has expired, the taxpayer may nevertheless make a join t return with his or her spouse for such taxable year .

However, the election under,, section 6,013(b)(1) may not b e made after the expiration of 3 years from the last dat e prescribed, by law for filing the return for such taxable yea r (determined without regard to any extension of time, granted to either spouse) . Sec . 6013(b)(2)(A) . Section 6072(a) provides that individual income tax returns for calendar year taxpayers must be filed on or before April 15 following the close of the calendar year . Thus, a 2002 tax return is timely filed on or before April 15, 2003 . To fall within section 6013(b)(2)(A), petitioner had to file a joint return on or before'April 15, 200 .6 . Petitioner did not submit a joint tax return to respondent until April 7, 2008, . nearly 2 years after the time prescribed by section 6013 (b) (2) (A) .

In addition, no election under section 6013(a)(1) maybe .

made "after there has been mailed to either spouse, with respec t to such taxable year, a notice of deficiency under section 6212 , if the spouse, as to such notice, files a petition with the Ta x Court within the time prescribed by section 6213" . Sec .

6013(b)(2)(B) . The notice of deficiency was mailed to petitioner on February 25, 2008, before the submission of the April .7, 2008 joint return, and a petition with the Tax Court was timely filed on May 28, &2008 .

Therefore, petitioner is precluded from filing a joint return for 2002 . 2 C .

Dependency Exemption Deduction s Petitioner claims she is entitled to two dependency exemption deductions, one each for her daughter and father .

As pertinent here, a taxpayer is entitled to a dependency exemption deduction for each . dependent (as ;defined in section.

152) whose gross income for the taxable year is less than the exemption amount . Sec . 151(c)(1)(A) . The exemption amount for 2002 was $3,000 . Sec . 15 .1(d)(1), (4) ;' Rev : Proc . 2001-59, sec .1 ' 3 .11, 2001-2 C .B . 623, 626 . Section 152(a) provides that the term "dependent" means an individual over half of whose support!

for the year was received from the taxpayer . "Dependent" ma y include a taxpayer's child-or parent . Sec . 152(a)(1), (4) .

I In .order to prove that a taxpayer provided more than hal f the support of her dependents, she must establish the entir e amount expended for their support from all'sources .

Archer v .

Commissioner , 73 T .C . 963, 967 (1980) ; Blanco v . Commissioner , ,56 T .C . 512, 514-515 (1971) . In addition, the taxpayer- must ?

demonstrate that the dependents' gross income did not exceed th e exemption amount . Sec . 151(c)(1)(A), (d)'(1), (4) .

The record is-devoid of any evidence regarding the total amount spent for the support of petitioners father and daughter (by petitioner and from other sources) ortthe gross income of petitioner's father and daughter for 2002 .1 Although we do no t doubt that petitioner may have contributed, to the-support of her father and daughter,'petitioner failed to show the extent of suc h support and the gross income, if any, of her father and daughter .

On the basis of the record, we decline to 'accept petitioner's unsupported assertion that she is entitled to the dependenc y exemption deductions claimed . See Tokarski v . Commissioner , 87 T .C . 74, 77 (1986 ) Accordingly, petitioner is not entitled to a dependency .exemption deduction for her father or daughter for 2002 .

D .

Section 6651(a)(1) Addition to Ta x Section 6651(a)(1) . imposes an addition to tax for failure to file a, return by its due date . The addition equals 5 percent for each month or fraction thereof . that the return is late, not to exceed 25 percent . Sec . 6651(a)(1) . Under section 6651(g)(1), a return prepared by the Secretary under section 6020(b) is disregarded for purposes of the section 6651(a)(1) addition to tax .

.

In the absence of an extension, the last date for petitioner to have filed her Federal income tax return for taxable year 2002 was Tuesday, April 15, . 2003 . Sec . 6072(a) . Petitioner's 2002 Form 1040 was not submitted, however, until April 7, 2008 .

"A failure to file a .tax return on the date prescribed leads to a mandatory penalty unless the taxpayer shows that such failure was due to reasonable cause and not due to willfu l neglect ."

McMahan v . Commissioner , 114 F .3d 366, 368 (2d Cir .

1997), affg . T .C . Memo . 1995-547 . A showing of reasonable cause .

requires a taxpayer to show that she exercised "ordinary, business care and. prudence" but was nevertheless unable'to file the return within the prescribed time .

United States v . Boyle , 469 U .S .

241, 246 (1985) ; sec . 301 .6651-1(c)(1), Proced . & Admin . Regs .

A taxpayer may have reasonable cause for failure to timel y file a return where the taxpayer or-,a member of the taxpayer' family experiences an illness or,incapacity that prevents th e taxpayer from filing his or her return .

See, e .g ., United State s v . Sanford , 979 F .2d 1511 (11th Cir . 1992) ;.(holding that reasonable cause may be found if(cid:127)a taxpayer convincingly demonstrates that a disability beyond his control rendered hi m i unable to exercise ordinary business care) . . The type o f disability required is "one that because of severity or timing makes it virtually impossible for the taxpayer to comply--things ::

like emergency hospitalization or other incapacity occurring around tax time ."

Carlson v . United States , 126 F .3d 915, 923 (7th Cir .1997 ) Although we recognize that petitioner's husband may. have been ill during 2002, petitioner did not explain how this illness prevented her from exercising ordinary business care and prudence .

On the basis of the record before us, we therefore conclude that petitioner did not demonstrate that her failure to timely file a tax return was due to reasonable cause and not willfu l neglect See sec . 301 .6651-1(c), Proced . & Admin . Regs .

Thus, petitioner is liable for the addition to tax under - 10 .- section 6651 (a)(1 ) E .

Section 6651(a)(2) Addition to Ta x Section .6651(a)(2) imposes an addition to tax for failure to pay the amount shown as tax on the return on or before the date prescribed . for payment of that tax, unless the failure was due to reasonable cause and not willful neglect . Sec . 301 .6651-1(c)(1), Proced . & Admin . Regs . Under section 6651(g)(2), a return prepared by the Secretary under section 6020(b) is treated as "the return filed by the taxpayer for purposes of determining the amount of the addition" under section 6651(a)(2) . A taxpayer may demonstrate cause for late payment by showing that'she exercised ordinary business care and prudence in providing for payment of her tax liability and was nevertheless either unable to,pay th e tax . or would suffer an undue hardship if she paid on the due date . Sec . 301 .6651-1(c)(1), Proced . .& Admin . Regs .

Petitioner did not, however, argue any set of facts or circumstances that would lead the Court to find that she exercised ordinary business care and prudence in providing for timely payment of her tax liability or that she would have suffered undue hardship if she had paid the tax-in full on its due date, April 15, 2003 .

See secs . 6072(a), 6151( a) ; sec .

301 .6651-1(c), Proced . & Admin . Regs .

R r Consequently, petitioner is,liable for, an addition to t-ax - 1 1 under .section 6651(a)(2) .

To reflect the foregoing, Decision will be .entered- for respondent as to,th e deficiency and the addition s to tax .under sectio n 6651(a)(1) and (2), and fo r petitioner as to the addition s to tax under section 6654 .

2. Although he could have, respondent chose not to seek an increased deficiency by applying the tax rates applicable t o .married individuals filing separately .