Claimed Earned Income Credit Disallowed if Child Cannot Get Social Security Number
FSA 1995-4
- Institutional AuthorsInternal Revenue Service
- Cross-Reference001490
- Code Sections
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 2000-6925
- Tax Analysts Electronic Citation1995 TNT 69-25
Internal Revenue Service
memorandum
CC:TL-N-11521-94
FS:IT&A:WJoseph
date: JAN 6 1995
to: Deputy Regional Counsel (TL)
Western Region CC:W
from: Assistant Chief Counsel (Field Service) CC:DOM:FS
subject: Earned Income Credit
This responds to your request dated December 8, 1994, for advice concerning our litigation position when a claimed earned income credit is disallowed because the child with respect to whom the credit has been claimed cannot obtain a social security number.
DISCLOSURE STATEMENT
This document may contain taxpayer information subject to section 6103. The document may also contain confidential information subject to the attorney-client and deliberative process privileges, and may also have been prepared in anticipation of litigation. Therefore, this document shall not be disclosed beyond the office or individual(s) to whom it is addressed and in no event shall it be disclosed to taxpayers or their representatives.
Specifically, if this memorandum is addressed to District Counsel, then only office personnel working the specific cases or subject matter may use this document. If this memorandum is addressed to a District Director, then only office personnel working the specific case or subject matter may use this document. This memorandum shall not be disclosed or circulated beyond such office personnel having the requisite "need to know.
ISSUE
Should the Service litigate a case in which the taxpayer has claimed the earned income credit for an otherwise qualifying child but the child cannot obtain a social security number?
CONCLUSION
Because the Service can assign a taxpayer identification number (TIN) for a taxpayer's child without a social security number (SSN), the absence of an SSN for a child that otherwise qualifies does not preclude allowance of the earned income credit. * * * .
FACTS
In a typical case, a taxpayer files a return claiming the earned income credit under I.R.C. § 32. The return does not show a SSN for the child with respect to whom the credit is claimed. When the taxpayer does not respond to correspondence from a service center, the service center mails a notice of deficiency disallowing the credit. The taxpayer then petitions the Tax Court for redetermination of the deficiency.
When the case is considered by Appeals or District Counsel, it is determined that the child with respect to whom the credit was claimed qualifies under the relationship, abode, and age requirement tests in section 32(c)(3)(A). However, the child does not have an SSN and cannot obtain one. The child may be an illegal alien.
DISCUSSION
For 1993, I.R.C. § 32(a) allows a refundable credit against tax for certain eligible individuals. Section 32(c)(1)(A) defines the term "eligible individual" as any individual who has a qualifying child for the taxable year.
Section 32(c)(3)(A) defines the term "qualifying child" as an individual who meets four tests. These are the relationship test, the abode test, the age requirement test, and.the identification requirements of section 32(c)(3)(D).
Section 32(c)(3)(D) provides:
(i) In general. The requirements of this subparagraph are met if --
(I) The taxpayer includes the name and age of each qualifying child (without regard to this subparagraph) on the return of tax for the taxable year, and
(II) In the case of an individual who has attained the age of 1 year before the close of the taxpayer's taxable year, the taxpayer includes the taxpayer identification number of such individual on such return of tax for such taxable year.
If you have any questions or need further assistance, please contact Warren Joseph at FTS (202) 622-7900.
by: _________________
GEORGE E. BOWDEN
Senior Technician Reviewer
Income Tax & Accounting Branch
Field Service Division
- Institutional AuthorsInternal Revenue Service
- Cross-Reference001490
- Code Sections
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 2000-6925
- Tax Analysts Electronic Citation1995 TNT 69-25