Opinion
Docket No. 2396-69SC.
1970-02-24
BETTY A. SHAPIRO, FORMERLY BETTY A. MELTZER, PETITIONER v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT
Seymour Werber, for the petitioner. Marvin A. Fein, for the respondent.
Seymour Werber, for the petitioner. Marvin A. Fein, for the respondent.
Held, that the cost of $916.66 incurred by petitioner in sending her minor son to summer residential camp constitutes part of his support under sec. 152(a), I.R.C. 1954, in determining who is entitled to be allowed the deduction for the personal exemption under sec. 151.
DAWSON, Judge:
Respondent determined a deficiency of $126.48 in petitioner's Federal income tax for the year 1966. The basic issue for decision in this case is whether the petitioner provided in the year 1966 more than one-half of the total support of her son, Michael, so as to qualify him as a dependent under section 152(a), Internal Revenue Code of 1954.
But the resolution of this issue depends on whether the cost of sending petitioner's minor son to a summer residential camp constitutes part of his ‘support’ for dependency exemption purposes.
All statutory references are to the Internal Revenue Code of 1954.
FINDINGS OF FACT
Betty A. Shapiro, formerly Betty A. Meltzer (herein called petitioner), was a resident of Great Neck, N.Y., at the time she filed her petition to this proceeding. She filed her individual Federal income tax return for the year 1966 with the district director of internal revenue at Brooklyn, N.Y.
Petitioner and her former husband, Joel S. Meltzer, had two children, Amy and Michael, who were 10 and 11 years old, respectively, during 1966. The parties separated in October 1964 pursuant to a written separation agreement under the terms of which the petitioner obtained custody of both children. During the entire year 1966, Amy and Michael lived with the petitioner. The separation agreement survived the decree of divorce obtained by petitioner from Joel sometime in 1966. Under the terms of the separation agreement, modified on June 2, 1966, Joel was required to pay petitioner certain amounts each month as alimony and child support. For the year 1966 both the petitioner and Joel claimed a dependency exemption for Michael on their Federal income tax returns. Only the petitioner claimed, and was allowed, the dependency exemption with respect to Amy.
Petitioner worked during 1966, earning total income of $8,708.28.
Michael attended Camp Wildwood for 8 weeks in the summer of 1966 at Bridgeton, Maine. The cost in sending him to this camp was $916.66. Petitioner paid $417 in 1966 and $499.66 in 1967.
Joel paid the petitioner $2,700 in 1966 pursuant to the terms of the separation agreement. Of this amount, $1,176 was spent for the support of Michael. In addition, Joel contributed $447.55 directly to Michael's support for the following items:
+--------------------------------+ ¦Allowance ¦$35.00¦ +-------------------------+------¦ ¦Entertainment ¦250.00¦ +-------------------------+------¦ ¦Gifts ¦45.55 ¦ +-------------------------+------¦ ¦Hospitalization insurance¦117.00¦ +-------------------------+------¦ ¦Total ¦447.55¦ +--------------------------------+
The following items of total support were furnished Michael during the taxable year:
+-------------------------------------+ ¦Babysitter fees ¦$300.00 ¦ +----------------------------+--------¦ ¦Camp Wildwood ¦916.66 ¦ +----------------------------+--------¦ ¦Clothing ¦200.00 ¦ +----------------------------+--------¦ ¦Entertainment and recreation¦350.00 ¦ +----------------------------+--------¦ ¦Food ¦660.00 ¦ +----------------------------+--------¦ ¦Gifts ¦145.55 ¦ +----------------------------+--------¦ ¦Eye glasses ¦27.25 ¦ +----------------------------+--------¦ ¦Hebrew school ¦188.00 ¦ +----------------------------+--------¦ ¦Rent ¦800.00 ¦ +----------------------------+--------¦ ¦Trumpet rental ¦25.00 ¦ +----------------------------+--------¦ ¦Allowance ¦35.00 ¦ +----------------------------+--------¦ ¦Hospitalization insurance ¦117.00 ¦ +----------------------------+--------¦ ¦Total ¦3,764.46¦ +-------------------------------------+
The total support furnished Michael in 1966 was not more than $3,764.46. Of this amount, the petitioner provided $2,090.90, petitioner's parents $50,, and Joel $1,623.55. There were no other sources contributing to Michael's support during that year.
Petitioner furnished more than one-half of the total support of her son Michael in the year 1966.
OPINION
There is no dispute as to the basic facts. The controversy centers around the narrow legal question as to whether or not the total cost of Michael's support for 1966 includes the cost of sending him to Camp Wildwood.
Respondent strongly contends that the cost in sending Michael to the summer residential camp was not for the necessities of life and therefore should not be considered in determining the total cost of his support.
Since the term ‘support’ is nowhere defined in the Internal Revenue Code, we must look to the regulations and decided cases to ascertain the meaning of ‘support’ as used in section 152(a). Section 1.152-1(a)(2)(i), Income Tax Regs., provides: ‘The term ‘support’ includes food, shelter, clothing, medical and dental care, education, and the like.' The Internal Revenue Service has even indicated the ‘support’ includes ‘expenditures for providing * * * recreation.’ See Your Federal Income Tax 22 (1970 ed). See also Form 2038, Information to Support Exemption Claimed for Dependent.
In our opinion the cost of sending a child to camp clearly comes within the rather expansive language of the regulations. We think such an expenditure qualifies as education, recreation, or the like. Webster's Third International Dictionary defines (1) ‘education’ as ‘the act or process of providing with knowledge, skill, or competence, or * * * desirable qualities of behaviour or character’ and (2) ‘recreation’ as ‘a means of getting diversion or entertainment.’ There can be no doubt that Michael derived knowledge, skill, and competence from his experience at Camp Wildwood. And the camp was surely a means of entertainment and diversion from the humdrum tedium of urban life. The importance of camp to the physical and intellectual development of an 11-year-old boy, like Michael, living in an urban environment is patently evident.
The cost of camp has been considered, without discussion, as an item of support in prior opinions. See Raymond M. McKay, 34 T.C. 1080, day camp; Lyta J. Morris, T.C. Memo. 1966-245; Lottie M. Henderson, a Memorandum Opinion of this Court dated June 8, 1953; Joyce T. Haft, T.C. Memo. 1970-38.
At trial, respondent's counsel made the following comments with respect to petitioner's expenditure of $916.66 in sending Michael to Camp Wildwood:
I well agree that this might be the manner in which a child in Great Neck is supposed to be supported, but for legal sake, the sake of this case, that it is not support of a child. That is a great luxury item I feel.
I can just look around the City of New York; there are children who don't even have food; they don't have housing; they don't have any of the bare necessities. It is preposterous to claim something like this.
While we commend counsel's compassion for the underprivileged children of New York City, we fail to see how their plight has any bearing on the resolution of the issue before us. Respondent's contention is that ‘support’ in this context should be limited to ‘necessities' is without merit. The term ‘necessities' is a relative one which depends on the facts of any given situation. The question of what things are to be regarded as ‘necessities,‘ customarily considered to be factual, generally depends on the particular facts and circumstances of each case, such as health, financial resources, and station in life of the child and parent. In applying the term to the facts of this case, we conclude that the cost of sending a child to camp may well be considered a necessity.
We completely disagree with respondent that ‘Support has been defined by courts as necessities.’ We realize, however, that there is some authority for this proposition. See Flowers v. United States, an unreported opinion (W.D. Pa. 1957, 52 A.F.T.R. 1383, 57-1 U.S.T.C.par. 9655), relying on Sid Dyer, T.C. Memo. 1955-168. We do not regard either of these cases as persuasive authority. The better principle of law, we think, is contained in the reported opinions of this Court which have repeatedly and consistently repudiated the rationale of the Sid Dyer case restricting the meaning of support to necessities. For example, in Raymond M. McKay, 34 T.C. 1080, 1084 (1960), we expressly rejected the argument ‘that only necessities are to be taken into consideration in determining what constitutes support furnished for a dependent,‘ holding that the expenses incurred for singing and dramatic lessons supplied the taxpayer's minor daughter constituted part of her support. In so holding, we said: ‘nothing in either the precise wording of section 152(a) or its legislative history * * * (convinces) us that the term ‘support’ as used therein should be limited to payments which a court could require parents to make as part of their common law or statutory duty to provide for their children.'
Such language makes it clear that the meaning of ‘support’ under section 152(a) is not restricted to necessities. This principle stems from our opinions in Bernard C. Rivers, 33 T.C. 935 (1960), holding that the cost of tuition in a parochial school is includable as an element of support, even though public schools were available; and Martha J. Blyth, 21 T.C. 275 (1953), holding that the cost of tuition at a private school constitutes an item of support. And just recently we reaffirmed what we said in McKay in Rose D. Seraydar, 50 T.C. 756, 761 (1968).
The real gravamen of respondent's argument herein does not seem to be so much the inclusion of camp as an item of support, but rather the inclusion of the particular amount ($916.66) as being unreasonable. It is, however, well settled that the exemption for a dependent does not depend upon the reasonableness of the amounts expended for support, or upon a comparison of what different parents may spend for the support of a child, but whether such dependent received over one-half of his actual support from the taxpayer. Warren C. Mawhinny, 43 T.C. 443 (1965), affd. 355 F.2d 462 (C.A. 3, 1966); Hazel Newman, 28 T.C. 550 (1957). See generally 5 Mertens, Law of Federal Income Taxation, sec. 32.14d, p. 69.
For these reasons we have included the cost petitioner incurred in sending Michael to Camp Wildwood as part of the total cost of his support in 1966. The fact that petitioner paid $499.66 of such cost in 1967 is immaterial, since ‘the year in which the item of support was furnished is controlling in determining the year in which the value of that support shall be included.’ Rose D. Seraydar, supra at 761. We therefore hold that the entire amount of $916.66 incurred in sending Michael to camp is includable as an item of his support for the year 1966. Accordingly, we conclude that petitioner provided more than one-half of Michael's total support in 1966 and is entitled to the claimed dependency exemption.
To reflect minor concessions made by the petitioner,
Decision will be entered under Rule 50.