Rev. Rul. 55-306

The application of the provisions of section 152(c) of the Internal Revenue Code of 1954, relating to multiple support agreements is illustrated by the following examples:

Example (1). Four brothers together contributed the entire support of their mother in 1954 in the following percentages: A , 30 percent; B , 20 percent; C , 29 percent; and D , 21 percent.

Example (2). An individual, E , who resides with his son received his entire support of $1,500 for the year 1954 in the following percentages: Social Security, 25 percent; F , an unrelated neighbor, 11 percent; G , a brother, 14 percent; H , a daughter, 10 percent; and I , a son, 40 percent.

Section 152 of the Code provides in part as follows:

(a) GENERAL DEFINITION.-* * * the term `dependent' means any of the following individuals over half of whose support, for the calendar year in which the taxable year of the taxpayer begins, was received from the taxpayer (or is treated under subsection (c) as received from the taxpayer):

*

(c) MULTIPLE SUPPORT AGREEMENTS.-For purposes of subsection (a), over half of the support of an individual for a calendar year shall be treated as received from the taxpayer if-

(1) no one person contributed over half of such support;

(2) over half of such support was received from persons each of whom, but for the fact that he did not contribute over half of such support, would have been entitled to claim such individual as a dependent for a taxable year beginning in such calendar year;

(3) the taxpayer contributed over 10 percent of such support; and

(4) each person described in paragraph (2) (other than the taxpayer) who contributed over 10 percent of such support files a written declaration (in such manner and form as the Secretary or his delegate may by regulations prescribe) that he will not claim such individual as a dependent for any taxable year beginning in such calendar year.

In example (1) above any one of the brothers, except for the fact that he did not contribute more than half of his mother's support, would have been entitled to claim her as a dependent. Consequently, any one of the brothers could claim a deduction for the exemption of the mother provided a written declaration from each of the other brothers is attached to his Federal income tax return. Even though A and D together contributed more than one-half the support of their mother, if A wished to claim his mother as a dependent, he would be required to attach written declarations from B and C as well as from D to his income tax return, since each of those three contributed more than 10 percent of the total support of their mother.

In example (2) above G, H , and I are persons each of whom, except for the fact that neither contributed more than half of the $1,500, could claim E as a dependent for a taxable year beginning in 1954. The three together contributed 64 percent of the $1,500, and, thus, each is a member of the group to be considered for the purpose of section 152(c) of the Code. G and I are the only members of such group who can meet all the requirements of section 152(c) of the Code and either one could claim E as a dependent for his taxable year beginning in 1954 provided he attached to his income tax return a written declaration signed by the ther, and furnished the other information required by the return with respect to all the contributions to E . Inasmuch as H did not contribute more than 10 percent of E's support, she would not be entitled to claim E as a dependent for a taxable year beginning in 1954 nor would she be required to file a written declaration with respect to her contributions to E. F contributed over 10 percent of the support of E in 1954 but he does not otherwise qualify as a member of the group for the purpose of the multiple support agreement under section 152(c) of the Code.

The member of a group of contributors who claims the dependency deduction for an individual under the multiple suppport agreement provisions of section 152(c) of the Code must attach to his income tax return for the year of the deduction a written declaration from each of the other persons who contributed more than 10 percent of the support of such individual and who, but for the failure to contribute more than half of the support of the individual, would have been entitled to claim the dependency exemption. The written declaration required may be made on Form 2120, Multiple Support Agreement, which contains a statement of the fact of contribution and a waiver of the claim for dependency exemption. Copies of Form 2120 will be supplied by District Directors to persons who request such forms. Any declaration made other than on Form 2120 shall conform to the substance of Form 2120. The taxpayer claiming the exemption should be prepared to furnish other information, when required, which will substantiate his right to claim such exemption. Such information may include a statement showing the names of all contributors (whether members of the group described in section 152(c) of the Code or not) and the amount contributed by each to the support of te dependent claimed.

This ruling will be applicable only for the period prior to the promulgation of regulations prescribed by the Commissioner, with the approval of the Secretary, in which will be set forth rules with respect to section 152(c) of the Code