Brother Can Claim EITC for Younger Siblings

Throughout 1999, B lived in an apartment with his mo-ther and his three younger siblings; his father and his older siblings did not live with them. B was employed as a machinist, and he was the financial provider for the family. He paid the apartment rent and the household bills. B’s mother suffered from cancer. She relied on crutches for walking and on B for transportation outside of the apartment. B frequently drove her to clinics for cancer treatments, to the grocery store and to relatives’ homes.

B’s younger siblings attended school full-time. Because their mother does not speak English, they relied on B for assistance with their homework. B and his mother shared responsibility in the discipline of his younger siblings. His mother established the household’s rules, such as setting curfews, and relied on B to enforce them.

B reported income of $14,101 on his 1999 Federal income tax return, consisting entirely of wages. B claimed an earned income tax credit (EITC), computed by treating two of his siblings as qualifying children. The IRS disallowed the EITC. In a summary opinion (Wolfe, J.), the Tax Court holds for B.

Sec. 32(a)(1) allows an eligible individual an EITC against income tax liability. An eligible individual is any individual who either (1) has a qualifying child, as defined by Sec. 32(c)(3) or (2) has no qualifying child and meets the requirements of Sec. 32(c)(1)(A)(ii).

For a taxpayer to be entitled to an EITC for a qualifying child, the child must satisfy a residency test, an age test and a relationship test. No dispute existed that B’s siblings were minors and students living in the same residence with him and that they satisfied the residency and age tests. The relationship test can be satisfied if the individual is an "eligible foster child" of the taxpayer. An eligible foster child is defined in part as an individual who "the taxpayer cares for as the taxpayer’s own child."

Neither the Code nor the regulations defines how a taxpayer cares for an individual as his own child. Merely contributing financially to an individual’s support does not rise to the level of caring for the individual as one’s own child.

The Service contends that B did not care for any of his siblings as if that sibling were his own child. We disagree. The record shows that B cared for his younger siblings in a parental capacity. In addition to being the primary source of financial support for the household (as well as for each of his younger siblings), B assumed the role of a father figure. B and his younger sister testified convincingly that he and his mother jointly shared parental duties during the year in issue, and that B conducted himself and cared for his siblings as though he were one of the parents in the household. He helped his siblings with homework at times, as his mother could not speak English and his father had left the household. He even had to explain personal hygiene to his younger sister because neither his mother nor an older sister could bring herself to do this task. His mother was unable to guide the younger children in the society in which they grew up, as she was disabled, spoke no English and knew only traditional Mexican society. Although he was available only to a limited extent because of the demands of his work, B filled the void for his siblings.

We conclude that, under difficult circumstances, B satisfied the requirements of Sec. 32(c)(3)(B)(iii) and is entitled to an EITC in the amount claimed.

Rafael Barajas, TC Summary Opinion 2002-59