in-20250528-IR-045250248NRA: DEPARTMENT OF STATE REVENUE

DEPARTMENT OF STATE REVENUE LETTER OF FINDINGS: 01-20241949 Indiana Income Tax For the Year 2023 HOLDING The Department declined to mediate a dispute between Individual and former wife concerning either party’s right to claim dependent childcare exemptions on Individual’s Indiana income tax return. ISSUE

I. Indiana Individual Income Tax – Dependent Exemptions.

Authority: IC 6-3-1-3.5; IC 6-8.1-5-1; Indiana Dept. of State Revenue v. Rent-A- Center East, Inc., 963 N.E.2d 463 (Ind. 2012); Wendt LLP v. Indiana Dept. of State Revenue, 977 N.E.2d 480 (Ind. Tax Ct. 2012); Scopelite v. Indiana Dept. of Local Gov’t Fin., 939 N.E.2d 1138 (Ind. Tax Ct. 2010); Lafayette Square Amoco, Inc. v. Indiana Dept. of State Revenue, 867 N.E.2d 289 (Ind. Tax Ct. 2007). Taxpayer argues that the Department’s assessment of additional 2023 income tax was wrong because Taxpayer correctly reported Taxpayer’s Indiana adjusted gross income. STATEMENT OF FACTS Taxpayer is an Indiana resident who routinely files Indiana individual income tax returns. Taxpayer filed his 2023 return. The Indiana Department of Revenue (“Department”) reviewed the return and then changed the return resulting in an adjustment to the refund originally called for in the return. In a letter dated February 2024, the Department explained: Taxpayer originally claimed two dependent exemptions on his return. The Department reduced the number of dependents to one. Taxpayer disagreed with the adjustment and submitted a “Secondary Review Request” which the Department treated as a protest. An administrative hearing was scheduled in order to provide Taxpayer an opportunity to explain the basis for his protest, but Taxpayer did not participate. This Letter of Findings is based on the documents Taxpayer provided in his request (protest) and on information available to the Department.

I.    Indiana Individual Income Tax – Dependent Exemptions.

DISCUSSION The issue is whether Taxpayer has met his burden of establishing that he was entitled to claim three dependent exemptions on his 2023 Indiana income tax return. The Department’s adjustment resulted in Taxpayer owing additional income tax. As such, Taxpayer is required to establish that the adjustment was wrong. A proposed assessment constitutes evidence that the Department’s claim for the unpaid tax is valid, and each taxpayer bears the burden of proving that any assessment is incorrect. IC 6-8.1-5-1(c); Indiana Dept. of State Revenue v. Rent-A-Center East, Inc., 963 N.E.2d 463, 466 (Ind. 2012); Lafayette Square Amoco, Inc. v. Indiana Dept. of State Revenue, 867 N.E.2d 289, 292 (Ind. Tax Ct. 2007). In fulfilling that burden, a taxpayer is required to provide documentation explaining and supporting his or her challenge that the Department’s position is wrong. Poorly developed and non-cogent arguments are subject to waiver. Scopelite v. Indiana Dept. of Local Gov’t Fin., 939 N.E.2d 1138, 1145 (Ind. Tax Ct. 2010); Wendt LLP v. Indiana Dept. of State Revenue, 977 N.E.2d 480, 486 n.9 (Ind. Tax Ct. 2012). Insofar as relevant to the Taxpayer’s “Line 8” deductions, IC 6-3-1-3.5(a) provides: Taxpayer provided a copy of a “Mediated Agreed Entry Resolving All Pending Petition” from the Marion County Circuit Court. The agreement that Taxpayer and former spouse would have joint custody of their two children but also held that: In the face of the court’s mediated agreement, Taxpayer apparently believes he is entitled to claim the full credit for each of the children. However, this is an issue the Department declines to address because the Department has no authority – or desire – to mediate family disputes. Of course, it was the Department which made the tax adjustment, but that adjustment was based on the information available to it. Simply put, there are apparently children over whom Taxpayer and former wife share joint custody. To what extent Taxpayer and former wife are entitled to claim the dependent child credits is an issue requiring either an agreement between Taxpayer and his former wife or intervention by the court. FINDING Taxpayer’s protest is denied. March 4, 2025 Replaces Finding Document at: New