§131 — Certain foster care payments

We hold that they may not; (2) whether petitioners are entitled to unreimbursed employee business expenses in an amount greater than that allowed or conceded by respondent.

Section 131 The Strommes claim eligibility under the section 131 exclusion from income of qualified foster care payments. Under that section, petitioners may exclude the 2005 and 2006 payments if they were: • made pursuant to a foster care program of a State; • paid by a State or political subdivision thereof, or a qualified agency; and • paid to a

17 - Section 131-1 a) eprovides: SEC. 13:.1(a). General Rule.--If a determination (as defined :.n section 1313) is described in one or more of the paragraphs off section 1312 and, on the date of the deternination, correction of the effect of the error referråd to in the applicable paragraph of section 1312 is prevented by the operation of any law or rul

o 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 payment

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”.

ussion The parties agree that payments petitioners received directly from residents, or their representatives, are taxable and that payments petitioners received for residents placed in their home directly by the State of Oregon are tax exempt under section 131. The parties disagree about whether payments petitioners received from ElderPlace are exempt from tax under section 131 and the proper allocation of expenses to exempt and nonexempt income under section 265. Section 131 Foster Care Paymen

duals with developmental disabilities. The county paid sums for the care ofthese individuals. Ps reported the amounts on their tax returns but then excluded them from income. Held: Ps cannot exclude the payments received to provide foster care under I.R.C. sec. 131 because they did not live in the house in which they provided lodging for the developmentally disabled adults. ! Sd!LNED NAR f 3 2012 - 2 - Jay B. Kelly, for petitioners. Christina L. Cook, for respondent. COLVIN, ChiefJudge: In 2005

yment pursuant to a State Medicaid waiver program for the care ofPs' disabled adult children. Pursuant to Notice 2014-7, 2014-4 I.R.B. 445, which classifies such payments as difficulty ofcare foster care payments not includible in gross income under I.R.C. sec. 131, Ps excluded the payment from gross income. Ps also claimed an earned income tax credit and the refundable portion ofa child tax credit. As relevant here, the credits are calculated with respect to "earned income" as defined in I.R.C.

for any unreimbursed out- of-pocket expenses incurred in supporting a foster child." Rev. Rul. 77-280, 1977-2 C.B. 14, 17. There is no question that the foster care reimbursements petitioners received from Monroe County are not taxable income under section 131. In the instant case, petitioners claim their total foster care expenses exceed their reimbursement. As - 10 - mentioned, petitioners are entitled to deduct unreimbursed expenditures made incident to the rendition of services to an organi

taxpayer claimed foreign tax credits for taxes - 79 - deemed paid under section 131(f) of the Internal Revenue Code of 1939, the predecessor to section 902, with respect to a dividend from a Canadian corporation of which it owned more than 10 percent.