Dobra v. Comm'r of Internal Revenue
| Decision Date | 29 December 1998 |
| Docket Number | No. 7573–97.,7573–97. |
| Citation | 111 T.C. 339,111 T.C. No. 19 |
| Parties | Pavel DOBRA and Ana Dobra, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent. |
| Court | U.S. Tax Court |
OPINION TEXT STARTS HERE
Paul A. Stamnes, for petitioners.
Wesley F. McNamara, for respondent.
Respondent determined deficiencies of $20,692 and $24,180 in petitioners' Federal income tax for 1992 and 1993, respectively. The only issue for decision is whether payments received by petitioners from the State of Oregon are to be excluded from petitioners' income under section 131(a) as “qualified foster care payments”.1 To resolve this issue we must answer a question of first impression: whether a house that is not the foster care provider's residence may constitute “the foster care provider's home” for purposes of section 131(b)(1)(B).
Petitioners Pavel Dobra and Ana Dobra, husband and wife (petitioners), resided in Portland, Oregon, at the time the petition was filed.
All of the facts have been stipulated. The stipulation of facts and the exhibits are incorporated herein by this reference.
During the tax years in issue—1992 and 1993—petitioners owned four residential properties in Portland, Oregon.2 The addresses of these properties were:
1. 16001 NE Morris Street (the Morris Street property);
2. 1819 SE 117th Avenue (117th Avenue property);
3. 11847 SE Alder Street (Alder Street property); and
4. 4125 SE 134th Avenue (134th Avenue property) (collectively, the properties).
The parties have stipulated that the Morris Street property was petitioners' “personal residence” and “personal family residence” during the years at issue. The record contains no information about petitioners' residential relationship to the other properties.
During 1992 and 1993, petitioners used the properties to provide residential care to adults. Five adult individuals received care at each of the properties, for a total of 20 individuals being cared for at any one time. The parties' briefs indicate that petitioners provided such care personally only at the Morris Street property; petitioners apparently hired resident managers to act as the primary caregivers at the other properties.
The State of Oregon made the following payments to petitioners for care provided at the properties:
+----------------------------------------+
¦Location ¦¦1992 ¦¦1993 ¦
+----------------------++-------++-------¦
¦Morris Street property¦¦$30,629¦¦$21,257¦
+----------------------++-------++-------¦
¦117th Avenue property ¦¦28,556 ¦¦27,443 ¦
+----------------------++-------++-------¦
¦Alder Street property ¦¦8,899 ¦¦21,218 ¦
+----------------------++-------++-------¦
¦134th Avenue property ¦¦14,092 ¦¦10,216 ¦
+----------------------------------------+
Petitioners took the position that all these payments were excludable under section 131(a), and they did not report any of the payments on their returns.
In the notice of deficiency, respondent did not contest (and is not here contesting) the application of section 131 to the payments received from the State of Oregon for care provided at the Morris Street property, which is petitioners' “personal family residence”. However, respondent determined (and urges us to hold) that the exclusion does not apply to the payments received for care provided at the other properties, none of which was petitioners' personal residence. Petitioners also received payments from private parties and from public agencies other than the State of Oregon (e.g., the U.S. Department of Veterans Affairs), but the tax treatment of these payments is not in dispute.
Section 131(a) provides the general rule that “Gross income shall not include amounts received by a foster care provider * * * as qualified foster care payments.” Section 131(b) defines the “qualified foster care payments” (QFCP) referred to by section 131(a). Under section 131(b)(1)(B), a payment may be a QFCP only if it is either a “difficulty of care payment”, as defined in section 131(c), or is “paid to the foster care provider for caring for a qualified foster individual in the foster care provider's home ” (emphasis added).3
Finally, section 131(b)(2) defines a “qualified foster individual” as “any individual who is living in a foster family home ” (emphasis added).4
The parties have stipulated that none of the payments at issue were “difficulty of care payments”. Accordingly, the parties assert—and we agree—that the outcome of this case depends upon the interpretation of the phrase “the foster care provider's home” in section 131(b)(1)(B).5
Petitioners' position is that each of the four properties is “the foster care provider's home”—even though they do not live in three of those “homes”. Petitioners claim that their position is supported by the plain meaning of section 131(b)(1)(B). Petitioners note that the properties are dwellings of the type commonly referred to as “houses” or “homes”. Petitioners also note that they own, and provide foster care in, those homes.6 Therefore, according to petitioners, in ordinary, everyday speech, all the homes are their (i.e., the foster care providers') homes, and all such homes therefore satisfy the statutory standard—whether or not they reside in them.
Respondent's position, by contrast, is that only the Morris Street property—the only property in which petitioners reside—can be “the foster care provider's home”. Unlike petitioners' position, respondent's position is not based on any assertedly plain meaning of the statute. Instead, respondent asks us to adopt an interpretation of the term “foster care provider's home” that is based on a specialized definition of the term “foster family home” used in section 131(b)(2). Respondent asserts that “in a foster care context” or “among state and local governmental agencies” foster family home means “the family residence of a licensed foster care provider in which the licensee is the primary provider of foster care.”
Employing this definition, respondent asserts that only the Morris Street property could be a foster family home, because only that property was petitioners' family residence. Respondent then concludes that only the Morris Street property could be the “foster care provider's home”—because any house that can be the “foster care provider's home” (i.e., the place where the foster individual must be cared for, under section 131(b)(1)(B)) must also be a “foster family home” (i.e., the place where the foster individual must live, under section 131(b)(2)).
As discussed below, we agree with respondent's ultimate conclusion that the payments made with respect to the properties other than the Morris Street property are not excluded under section 131(a). Nevertheless, we do not accept the specialized definition of “foster family home” respondent asserts, for the following reason.
Respondent argues that “foster family home” is a “term of art” in the social work field, with a specialized meaning that we must adopt in interpreting section 131. However, respondent has neither presented any admissible evidence of the meaning asserted, nor asked us to take judicial notice of that meaning. The only materials respondent has offered us—in respondent's briefs—are citations to two social work treatises and some State statutes.7 Our examination of these materials leads us to conclude that they do not establish either that foster family home is a term of art in the social work field, or that the term has the meaning respondent asserts. In addition, it appears to us that the properties other than the Morris Street property might satisfy respondent's definition of “foster family home”—because those properties were the family residences of petitioners' resident managers, the licensed primary caregivers therein.8
Because respondent has not persuaded us that respondent's specialized or technical definition is necessary, helpful, or appropriate in this case, we see no reason to deviate from the general rule that a statute should be interpreted in accordance with the “plain” or “ordinary, everyday” meaning of its terms. United States v. Ron Pair Enter., Inc., 489 U.S. 235, 241–242, 109 S.Ct. 1026, 103 L.Ed.2d 290 (1989); Richards v. United States, 369 U.S. 1, 9, 82 S.Ct. 585, 7 L.Ed.2d 492 (1962); Crane v. Commissioner, 331 U.S. 1, 6, 67 S.Ct. 1047, 91 L.Ed. 1301 (1947). Accordingly, we do not consider further respondent's argument with respect to the meaning of “foster family home”; instead, we turn our attention directly to the plain meaning of “the foster care provider's home” as used in section 131(b)(1)(B).
As a preliminary matter, we note that section 131 does not define either “the foster care provider's home” or the term “home” more generally. In addition, although the term “home” is used numerous times elsewhere in the Code, the Code contains no general purpose definition of “home”, applicable to all sections.
Having noted that this is a case of first impression, we observe that counsel have not referred us to—and we have not found—any cases interpreting “home” or “the foster care provider's home” for purposes of section 131.
Finally, the legislative history of section 131, in our judgment, provides little if any guidance to the meaning of “home”, for purposes of adult foster care, that cannot also be gleaned from the plain language of the statute. 9
Our work therefore begins with the text of section 131. As the Supreme Court has stated: “The task of resolving the dispute over the meaning of * * * [the statutory provision at issue] begins where all such inquiries must begin: with the language of the statute itself.” United States v. Ron Pair Enter., Inc., supra at 241 (citation omitted). Moreover, where the statute's language is plain, the language is also where the interpretative task should end....
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