Davis v. Fair
| Decision Date | 27 March 1986 |
| Docket Number | No. 11-85-322-CV,11-85-322-CV |
| Citation | 707 S.W.2d 711 |
| Parties | Gretta Fair DAVIS, Appellant, v. David Patterson FAIR, Appellee. |
| Court | Texas Court of Appeals |
Jerry Bain, Bain, Files, Allen & Caldwell, Tyler, for appellant.
Sam Cobb, Jr., Sam Cobb, Jr. & Associates, P.C., Mike A. Hatchell, Ramey, Flock, Hutchins, Jeffus, Crawford & Harper, Tyler, for appellee.
This case arose out of an order modifying a decree of divorce. On April 13, 1984, Gretta Fair Davis, appellant, and David Patterson Fair, appellee, were divorced. Davis was appointed managing conservator of the parties' two children, and Fair was appointed possessory conservator. The decree ordered Fair to pay $750 a month per child as support "until the child for whom such payment is being made reaches the age of eighteen." This decree was subsequently modified by an agreed order on September 24, 1984. On June 20, 1985, Fair sought an order modifying the original decree of divorce and the subsequent agreed order to provide him with the right to claim the parties' children as dependents for each taxable year in which he makes child support payments as ordered by the court. Alternatively, Fair sought a modification order reducing the amount of child support payments. On September 17, 1985, following a hearing, the trial court entered an order modifying decree of divorce and agreed order which provided:
It is, therefore, ORDERED that the Decree of Divorce and the Agreed Order entered herein are hereby expressly amended to provide that Petitioner, David Patterson Fair, shall be entitled to claim Laura Jane Fair and Eugenia Greer Fair as his dependents for each taxable year beginning January 1, 1985, in which he shall have made child support payments for each such child as ordered by this Court, so that the provisions of the revised paragraph (e) of Section 152 of the Internal Revenue Code of the United States shall not apply to the Decree of Divorce entered on April 13, 1984, as amended by the Agreed Order entered on September 24, 1984.
Davis appeals. We reverse and remand.
Davis argues that the trial court erred in entering the order to modify because such order was in violation of Internal Revenue Code sec. 152 (West 1984 & West Supp. 1985). We agree.
At the time of the divorce, Section 152 provided in pertinent part:
such child shall be treated, for purposes of subsection (a), as receiving over half of his support during the calendar year from the parent having custody for a greater portion of the calendar year unless he is treated, under the provisions of paragraph (2), as having received over half of his support for such year from the other parent (referred to in this subsection as the parent not having custody).
(2) Special rule.--The child of parents described in paragraph (1) shall be treated as having received over half of his
support during the calendar year from the parent not having custody if--
(A)(i) the decree of divorce or of separate maintenance, or a written agreement between the parents applicable to the taxable year beginning in such calendar year, provides that the parent not having custody shall be entitled to any deduction allowable under section 151 for such child, and
(ii) such parent not having custody provides at least $600 for the support of such child during the calendar year, or
(B)(i) the parent not having custody provides $1,200 or more for the support of such child (or if there is more than one such child, $1,200 or more for each of such children) for the calendar year, and
(ii) the parent having custody of such child does not clearly establish that he provided more for the support of such child during the calendar year than the parent not having custody.
Fair, presumably, had been claiming the two dependency exemptions under the special rule contained in Section 152(e)(2)(B). Davis had not attempted to claim the two dependency exemptions under the general rule contained in Section 152(e)(1).
Section 152 was amended in 1984, effective January 1, 1985. The original decree was entered before passage of the amendment. The agreed order, modifying the original decree, was entered after the passage, but before the effective date, of the amendment. The trial court's September 17, 1985, order modifying the original decree of divorce and agreed order is founded solely upon the 1984 amendment to Section 152. Fair does not come within any of the exceptions contained in Section 152(e), as amended. After the amendment, Section 152 provides, in pertinent part:
(e) Support test in case of child of divorced parents, etc.--
(1) Custodial parent gets exemption.--Except as otherwise provided in this subsection, if--
(i) who are divorced or legally separated under a decree of divorce or separate maintenance,
(ii) who are separated under a written separation agreement, or
(iii) who live apart at all times during the last 6 months of the calendar year, and
such child shall be treated, for purposes of subsection (a), as receiving over half of his support during the calendar year from the parent having custody for a greater portion of the calendar year (hereinafter in this subsection referred to as the "custodial parent").
(2) Exception where custodial parent releases claim to exemption for the year.--A child of parents described in paragraph (1) shall be treated as having received over half of his support during a calendar year from the noncustodial parent if--
(A) the custodial parent signs a written declaration (in such manner and form as the Secretary may be regulations prescribe) that such custodial parent will not claim such child as a dependent for any taxable year beginning in such calendar year, and
(B) the noncustodial parent attaches such written declaration to the noncustodial parent's return for the taxable year beginning during such calendar year.
For purposes of this subsection, the term "noncustodial parent" means the parent who is not the custodial parent.
(3) Exception for multiple-support agreement.--This subsection shall not apply in any case where over half of the support of the child is treated as having been received from a taxpayer under the provisions of subsection (c).
(4) Exception for certain pre-1985 instruments.--
(i) a qualified pre-1985 instrument between the parents applicable to the taxable year beginning in such calendar year provides that the noncustodial parent shall be entitled to any deduction allowable under section 151 for such child, and
(ii) the noncustodial parent provides at least $600 for the support of such child during such calendar year.
For purposes of this subparagraph, amounts expended for the support of a child or children shall be treated as received from the noncustodial parent to the extent that such parent provided amounts for such support.
(i) which is executed before January 1, 1985,
(ii) which on such date contains the provision described in subparagraph (A)(i), and
(iii) which is not modified on or after such date in a modification which expressly provides that this paragraph shall not apply to such decree or agreement.
The general rule of Section 152(e) remained substantially the same after the 1984 amendment. Under the general rule of Section 152(e) as it presently exists, Davis would be the parent entitled to claim the dependency exemptions due to the fact that Davis is the managing conservator. This is exactly the same result which existed under the general rule of Section 152(e) prior to the 1984 amendment. The primary and relevant changes which the 1984 amendment made to Section 152(e) were in the area of the exceptions to the general rule.
Prior to the 1984 amendment, Section 152(e) provided two means by which the noncustodial parent could acquire the right to claim his or her children as tax exemptions. See Hiland v. Hiland, 467 N.E.2d 1253 (Ind.Ct.App.1984). The noncustodial parent could claim his or her children as dependents if: (1) he or she was awarded the exemption under the dissolution decree and he or she paid at least $600 per year per child in support; or (2) the noncustodial parent paid at least $1,200 per year per child in support and the custodial parent failed to show that he or she provided more support than the noncustodial parent during the same calendar year. In addition, subsection (c) of Section 152, dealing with multiple support agreements, also provided an exception to the general rule.
After the 1984 amendment to Section 152, subsection (e) provides the following means by which the noncustodial parent can acquire the right to claim his or her children as dependents: (1) if a multiple support agreement is in effect, subsection (c) of Section 152 can provide an exception to the general rule which gives the custodial parent the right to claim the exemption; (2) if the custodial parent signs a written declaration...
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