1999-2064(IT)I
BETWEEN:
RICHARD CONRAD MATHIS,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeal heard on February 24, 2000, at London, Ontario, by
the Honourable Judge M.A. Mogan
Appearances
For the Appellant: The Appellant himself
Counsel for the Respondent: Michelle Farrell
JUDGMENT
The appeal from the assessment of tax made under the Income Tax Act for the 1997 taxation year is dismissed.
Signed at Ottawa, Canada, this 22nd day of March, 2000.
|
"M.A. Mogan" |
J.T.C.C.
Date: 20000322
Docket: 1999-2064(IT)I
BETWEEN:
RICHARD CONRAD MATHIS,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Mogan J.T.C.C.
[1] During 1997, the Appellant paid $7,200 at the rate of $600 per month for the maintenance of his two daughters. When computing his income, the Appellant deducted as maintenance payments the amount of $7,200 under paragraph 60(b) of the Income Tax Act. When assessing tax for 1997, the Minister of National Revenue disallowed the deduction of $7,200. The only issue in this appeal is whether the Appellant was entitled to the deduction of $7,200 when computing his income. The Appellant has elected the informal procedure.
[2] The Appellant and Andrea Mathis were married in 1979. There were two children born of the marriage: Allison born in July 1980 and Amanda born in December 1984. The Appellant and Andrea separated in 1990 when the Appellant moved out of the family dwelling. In 1991, Andrea's mother (Eva Lakajos) who was a widow moved into the family dwelling to stay with Andrea and to help look after Allison and Amanda.
[3] The Appellant and Andrea signed a separation agreement dated May 10, 1993 which, inter alia, provided for payments in the amount of $500 per month from the Appellant to Andrea for the support of their two daughters during 1993 and 1994, and $600 per month commencing in 1995. The Appellant started making those payments in May 1993. Divorce proceedings had commenced but Andrea Mathis died on August 23, 1993 before the divorce was granted. After Andrea's death, Eva Lakajos (the grandmother of Alison and Amanda) continued to reside in the family dwelling caring for her two granddaughters. Also, the Appellant continued to make the maintenance payments specified in the separation agreement of May 10, 1993; the only difference being that after August 1993, the payments were made to Eva Lakajos who was caring for Allison and Amanda. The Appellant has not resided in the same dwelling with Allison and Amanda since he left the family dwelling in 1990 upon his separation from Andrea.
[4] It is an admitted fact that in 1997, the Appellant paid $7,200 to Eva Lakajos at the rate of $600 per month, and that those payments were for the purpose of maintaining his two daughters, Allison and Amanda. In this case, there are no facts in dispute. The Appellant put his appeal on the basis of fairness. He was entitled to deduct the amounts paid under the separation agreement so long as his wife was alive. Following Andrea' death, he continued the same payments to his mother-in-law because she was in fact standing in the place of his deceased wife as the prime caregiver for his two daughters.
[5] The provision of the Act which permits the deduction of payments for the support of children is paragraph 60(b) which states in part:
60 There may be deducted in computing a taxpayer's income for a taxation year such of the following amounts as are applicable:
(b) the total of all amounts each of which is an amount determined by the formula
A - (B + C)
where
A is the total of all amounts each of which is a support amount paid after 1996 and before the end of the year by the taxpayer to a particular person, where the taxpayer and the particular person were living separate and apart at the time the amount was paid, (underline added)
The words "support amount" are defined in subsection 56.1(4) and made applicable to section 60 by subsection 60.1(4):
56.1(4) The definitions in this subsection apply in this section and section 56.
"support amount" means an amount payable or receivable as an allowance on a periodic basis for the maintenance of the recipient, children of the recipient or both the recipient and children of the recipient, if the recipient has discretion as to the use of the amount, and
(a) the recipient is the spouse or former spouse of the payer, the recipient and payer are living separate and apart because of the breakdown of their marriage and the amount is receivable under an order of a competent tribunal or under a written agreement; or
(b) the payer is a natural parent of a child of the recipient and the amount is receivable under an order made by a competent tribunal in accordance with the laws of a province.
[6] The amounts paid in 1997 by the Appellant to Eva Lakajos (the grandmother of Allison and Amanda) are not "support amounts" within the meaning of subsection 56.1(4) and paragraph 60(b) because Eva Lakajos is not and never was the spouse of the Appellant, and the Appellant never was a natural parent of a child of Eva Lakajos.
[7] I have tried to see if the Appellant could be entitled to a tax credit under paragraph 118(1)(b) of the Act but he does not qualify under that paragraph because Allison and Amanda did not reside in the same dwelling with the Appellant in 1997. The appeal is dismissed.
Signed at Ottawa, Canada, this 22nd day of March, 2000.
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"M.A. Mogan" |
J.T.C.C.
COURT FILE NO.: 1999-2064(IT)I
STYLE OF CAUSE: Richard Conrad Mathis and
Her Majesty the Queen
PLACE OF HEARING: London, Ontario
DATE OF HEARING: February 24, 2000
REASONS FOR JUDGMENT BY: The Honourable Judge M.A. Mogan
DATE OF JUDGMENT: March 22, 2000
APPEARANCES:
For the Appellant: The Appellant himself
Counsel for the Respondent: Michelle Farrell
COUNSEL OF RECORD:
For the Appellant:
Name: N/A
Firm:
For the Respondent: Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada