I like this summary opinion because the Tax Court methodically lays out the rules for determining who is and who is not a dependent. The Court then meticulously applies the facts to the rules.
The issue here is pretty straightforward. Ms. Brockington claimed dependency exemption deductions for her son (age 19), daughter (age 21), and grand-daughter on her 2005 tax return. The Court determined she could not claim any of them as dependents because they were not full-time students and (with the exception of the grand-daughter) they each earned more than the 2005 personal exemption, $3,200.
But, they did not earn much more. Ms. Brockington's daughter earned $3,512 and her son earned $7,365 during 2005. From a tax policy perspective, why not provide Ms. Brockington with a dependency exemption deduction? Without her support, three people would probably not be able to live indoors. Further, because she is denied the dependency exemptions, she also is denied head of household filing status and is taxed at the higher single filing status rates.
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