In the

United States Court of Appeals

For the Seventh Circuit

No. 08-2169

DAVID A. WILBERT,

Petitioner-Appellant,

v.

COMMISSIONER OF INTERNAL REVENUE,

Respondent-Appellee.

Appeal from the United States Tax Court.

No. 29172-05—Diane L. Kroupa, Judge.

ARGUED DECEMBER 10, 2008—DECIDED JANUARY 21, 2009

Before POSNER, KANNE, and ROVNER, Circuit Judges.

POSNER, Circuit Judge. The question presented by this

appeal is whether an employee who uses “bumping” rights

to avoid or postpone losing his job can deduct the

living expenses that he incurs when he finds himself

working far from home as a result of exercising those

rights. The Tax Court ruled against the taxpayer, T.C.

Memo 2007-152, 2007 WL 1713379, assessing a deficiency

of $4,380 in his income tax payments for 2003, and he
2 No. 08-2169

appeals. This is one of a number of largely identical cases

in the Tax Court, see, e.g., Wasik v. Commissioner, T.C.

Memo 2007-148, 2007 WL 1702689; Stephens v. Commissioner, T.C. Summary Op. 2007-94, 2007 WL 1702612;

Stockwell v. Commissioner, T.C. Memo 2007-149, 2007 WL

1702608, all brought by mechanics formerly employed

by Northwest Airlines, like Wilbert, and all resolved

against the taxpayer. But this seems the first case to be

appealed.

Hired by Northwest in 1996, Wilbert worked for the

airline at the Minneapolis airport for some years. He

lived with his wife in Hudson, Wisconsin, across the

Mississippi River from Minneapolis. Hudson is a suburb

of Minneapolis, roughly 25 miles from the airport.

Facing financial pressures and a decline in airline

traffic in the wake of the terrorist attacks of September 11,

2001, Northwest laid off many employees, including, in

April 2003, Wilbert. But Northwest’s mechanics each

had a right to bump a more junior mechanic employed

by the airline, that is, to take his job. Wilbert was able

to bump a mechanic who worked for the airline in

Chicago, but he worked there for only a few days before

being bumped by a more senior mechanic. A few days

later he was able to bump a mechanic in Anchorage,

Alaska, and he worked there for three weeks before

being himself bumped. He was soon able to bump a

mechanic who worked in New York, at LaGuardia

Airport, but he worked there for only a week before he

was bumped again. At this point, he had exhausted his

bumping rights. But for reasons that the parties have not
No. 08-2169 3

explained, three weeks later the airline hired him back,

outside the bumping system, to fill an interim position

(maximum nine months) in Anchorage. He occupied that

position for several months before being laid off again,

this time for good. At no point in his hegira did he have

realistic prospects of resuming work for Northwest

in Minneapolis. He now lives in a Chicago suburb and

works for Federal Express at O’Hare Airport. He sells

real estate on the side (self-employed), as he did when

he lived in Minneapolis, but his income from his real

estate business there was only $2,000 in 2003, the relevant

tax year, and he did not actually receive the money (a

commission) until the following year.

He did not sell or rent his home in Hudson, where

his wife continued to live, while working intermittently

in 2003. Because he was working too far from home to be

able to live there, he incurred living expenses (amounting

to almost $20,000) that he would not have incurred had

he remained working in Minneapolis, and those are the

expenses he deducted from the taxable income shown

on his 2003 return.

The Internal Revenue Code allows the deduction, as

part of “the ordinary and necessary expenses . . . incurred

during the taxable year in carrying on any trade or business,” of “traveling expenses . . . while [the taxpayer is]

away from home in the pursuit of a trade or business.” 26

U.S.C. § 162(a)(2) (emphasis added). There is an exception for “personal, living, or family expenses.” § 262(a).

The phrase we have italicized is critical. It is by an interpretation of that phrase that commuting expenses are
4 No. 08-2169

disallowed because of “a natural reluctance . . . to

lighten the tax burden of people who have the good

fortune to interweave work with consumption. To allow a

deduction for commuting would confer a windfall on

people who live in the suburbs and commute to work in

the cities.” Moss v. Commissioner, 758 F.2d 211, 212 (7th

Cir. 1985). The length of the commute is thus irrelevant.

If Wilbert had had a permanent job in Anchorage but

decided to retain his home in Minneapolis and return there

on weekends and during the week live in a truck stop

in Wasilla, Alaska, he could not have deducted from his

taxable income the expense of traveling to and fro

between Minnesota and Alaska or his room and board in

Wasilla. (We ignore for the moment the possibility that

Mrs. Wilbert had a job in Minneapolis, and if so its relevance.)

Similarly, he could not have deducted his traveling

expenses if he had had no home separate from the places

he traveled to—if he had been, in the language of the cases,

an “itinerant” worker, for then he would never have been

“away from home” on his travels. E.g., Fisher v. Commissioner, 230 F.2d 79 (7th Cir. 1956); Henderson v. Commissioner, 143 F.3d 497 (9th Cir. 1998); Deamer v. Commissioner,

752 F.2d 337 (8th Cir. 1985) (per curiam). He would have

been like someone whose only residence is a recreational

vehicle, or a truck driver who lives in the cab of his truck,

or the taxpayer in the Fisher case—“an itinerant professional musician, [who] traveled from city to city performing, solo, in various hotel dining rooms and cocktail

lounges. These engagements varied in duration from

three to four weeks, or as long as seven or eight months.
No. 08-2169 5

His wife and child traveled and lived with taxpayer

wherever he was situated.” 230 F.2d at 80.

With our hypothetical Wilbert the long-distance commuter, compare a lawyer whose home and office are

both in Minneapolis but who has an international

practice and as a result spends more time on the road

than he does at home. Nevertheless he can deduct his

traveling expenses. His work requires him to maintain a

home within normal commuting distance of Minneapolis

because that is where his office is, but his work also

requires him to travel, and the expenses he incurs in

traveling are necessary to his work and he cannot offset

them by relocating his residence to the places to which

he travels because he has to maintain a home near his

office. And likewise if, as in Andrews v. Commissioner, 931

F.2d 132 (1st Cir. 1991), the taxpayer has to make

such frequent trips to a particular site that it is more

economical for him to rent or buy a second residence, at

that site, than to live there in a hotel.

Wilbert’s case falls in between our two hypothetical

cases. Unlike the lawyer, he did not have to live near

Minneapolis after the initial layoff because he had no

work there (ignoring for the moment his real estate business). But unlike the imaginary Wilbert who has a permanent job in Alaska and so could readily relocate his

home there, the real Wilbert had jobs of indefinite, unpredictable duration in Alaska (and Chicago, and New York).

It would hardly have been realistic to expect him to pull

up stakes and move to Anchorage and then to Chicago

and then to New York and then back to Anchorage.
6 No. 08-2169

Remember that his first stint after the initial layoff

lasted only days, his second only weeks, and the third

only one week. His situation was unlike that of the employee of a New York firm who, if he chooses to live in

Scarsdale rather than on Fifth Avenue, is forbidden to

deduct from his taxable income the commuting expense

that he incurs by virtue of his choice; it is a personal

choice—suburban over urban living—rather than

anything necessitated by his job.

The Tax Court, with some judicial support, has tried to

resolve cases such as this by asking whether the taxpayer’s work away from home is “temporary” or “indefinite,” and allowing the deduction of traveling expenses

only if it is the former. E.g., Peurifoy v. Commissioner, 358

U.S. 59 (1958) (per curiam); Kasun v. United States, 671

F.2d 1059 (7th Cir. 1982); Michael D. Rose & John C.

Chommie, Federal Income Taxation § 3.10, pp. 117-20 (3d ed.

1988). The Internal Revenue Code does not explicitly

adopt the distinction, but does provide (with an immaterial exception) that “the taxpayer shall not be treated as

being temporarily away from home during any period

of employment if such period exceeds 1 year.” 26 U.S.C.

§ 162(a).

The problem with the Tax Court’s distinction is that

work can be, and usually is, both temporary and indefinite,

as in our lawyer example. A lawsuit he is trying in

London might settle on the second day, or last a month;

his sojourn away from his office will therefore be both

temporary and indefinite. Indeed all work is indefinite

and much “permanent” work is really temporary. An
No. 08-2169 7

academic lawyer might accept a five-year appointment

as an assistant professor with every expectation of obtaining tenure at the end of that period at that or another

law school; yet one would not describe him as a “temporary” employee even if he left after six months and

thus was not barred from claiming temporary status by

the one-year rule. Our imaginary Wilbert who has a

permanent job in Anchorage but is reluctant to move

there from Minneapolis might argue (at least until he

had worked a year, the statutory cutoff for “temporary”

work) that no job is “permanent”—he might be fired, or

he might harbor realistic hopes of getting a better job

back in Minneapolis. That possibility would not permit

him to deduct the expense of commuting from

Minnesota to Alaska.

So “temporary versus indefinite” does not work well as

a test of deductibility and neither does “personal choice

versus reasonable response to the employment situation,”

tempting as the latter formula is because of its realism.

If no reasonable person would relocate to his new place

of work because of uncertainty about the duration of

the new job, his choice to stay where he is, unlike a

choice to commute from a suburb to the city in which

one’s office is located rather than live in the city, is not

an optional personal choice like deciding to stay at a

Four Seasons or a Ritz Carlton, but a choice forced by

circumstances. Wilbert when first notified that he was

being laid off could foresee a series of temporary jobs all

across the country and not even limited, as we know, to

the lower 48 states, and the costs of moving his home to

the location of each temporary job would have been
8 No. 08-2169

prohibitive. It would have meant moving four times in

one year on a mechanic’s salary to cities hundreds or (in

the case of Anchorage versus Minneapolis, Chicago, or

New York) thousands of miles apart.

The problem with a test that focuses on the reasonableness of the taxpayer’s decision not to move is that it

is bound to prove nebulous in application. For it just

asks the taxpayer to give a good reason for not moving

his home when he gets a job in a different place, and if

he gave a good reason then his traveling expenses

would be deductible as the product of a reasonable balancing of personal and business considerations. In the oftcited case of Hantzis v. Commissioner, 638 F.2d 248 (1st

Cir. 1981), the question was whether a law student who

lived in Boston with her husband during the school year

could deduct her traveling expenses when she took a

summer job in New York. Given the temporary nature

of the job, it made perfectly good sense for her to retain

her home in Boston and just camp out, as it were, in

New York. What persuaded the court to reject the deduction was that she had no business reason to retain the

house in Boston. Id. at 255. Stated differently, she had no

business reason to be living in two places at once, id. at 256,

unlike the lawyer in our example. And so the expenses

she incurred living in New York could not be thought

“ordinary and necessary expenses . . . incurred . . . in

carrying on any trade or business.”

If this seems rather a mechanical reading of the statute,

it has the support not only of the influential precedent

of Hantzis but also of the even more influential precedent
No. 08-2169 9

of Commissioner v. Flowers, 326 U.S. 465, 474 (1946), where

the Supreme Court said that “the exigencies of business

rather than the personal conveniences and necessities

of the traveler must be the motivating factors” in the

decision to travel. The “business exigencies” rule, though

harsh, is supported by compelling considerations of

administrability. To apply a test of reasonableness the

Internal Revenue Service would first have to decide

whether the taxpayer should have moved to his new

place of work. This might require answering such questions as whether the schools in the area of his new job

were far worse than those his children currently attend,

whether his elderly parents live near his existing home

and require his attention, and whether his children

have psychological problems that make it difficult for

them to find new friends. Were it decided that it was

reasonable for the taxpayer to stay put, it would then

become necessary to determine whether the expenses he

incurred in traveling to and from his various places of

work for home visits had been reasonable—whether in

other words such commutes, in point of frequency, were

“ordinary and necessary” business expenses. The Internal

Revenue Service would have to establish norms of reasonable home visits that presumably would vary with

such things as distance and how many of the taxpayer’s

children were living at home and how old they were.

We are sympathetic to Wilbert’s plight and recognize

the artificiality of supposing that, as the government

argues, he made merely a personal choice to “commute”

from Minneapolis to Anchorage, and Chicago, and New
10 No. 08-2169

York, as if Minneapolis were a suburb of those cities. But

the statutory language, the precedents, and the considerations of administrability that we have emphasized

persuade us to reject the test of reasonableness. The

“temporary versus indefinite” test is no better, so we

fall back on the rule of Flowers and Hantzis that unless the

taxpayer has a business rather than a personal reason to

be living in two places he cannot deduct his traveling

expenses if he decides not to move. Indeed, Wilbert’s

situation is really no different from the common case of

the construction worker who works at different sites

throughout the country, never certain how long each stint

will last and reluctant therefore to relocate his home. The

construction worker loses, as must Wilbert. E.g., Yeats v.

Commissioner, 873 F.2d 1159 (8th Cir. 1989).

We might well have a different case if Wilbert had had

a firm, justified expectation of being restored to his job at

the Minneapolis airport within a short time of his initial

layoff. Suppose the airline had said to him, “We must lay

you off, but you will be able to bump a less senior employee in Anchorage for a few weeks, and we are

confident that by then, given your seniority, you will

be able to return to Minneapolis.” His situation would

then be comparable to that of a Minneapolis lawyer

ordered by his senior partner to spend the next month

trying a case in Anchorage. But that is not this case.

Wilbert has another string to his bow, however, arguing

that he had two businesses, not one, the other being the

sale of real estate, and that because that business was

centered in Minneapolis he had a business reason to live
No. 08-2169 11

near there. This would be a good argument if selling real

estate were his main business. Andrews v. Commissioner,

supra, 931 F.2d at 138; Ziporyn v. Commissioner, T.C. Memo

1997-151, 1997 WL 129359; Sherman v. Commissioner, 16 T.C.

332, 337 (1951); William A. Klein, Joseph Bankman &

Daniel N. Shaviro, Federal Income Taxation 465 (14th ed.

2006); 1 Boris I. Bittker & Lawrence Lokken, Federal Taxation of Income, Estates and Gifts ¶ 21.1.6, pp. 21-20 to 21-21

(3d ed. 1999). But obviously it is not, or at least was not

in 2003, when his total income (and in an accrual rather

than a cash sense) from selling real estate was only $2,000.

As explained in Andrews, “The guiding policy must be

that the taxpayer is reasonably expected to locate his

‘home,’ for tax purposes, at his ‘major post of duty’ so as

to minimize the amount of business travel away from

home that is required; a decision to do otherwise is motivated not by business necessity but by personal considerations, and should not give rise to greater business travel

deductions.” 931 F.2d at 138. If Wilbert had had to travel

back to Minneapolis from his new tax “homes” from time

to time in order to attend to his real estate business, the

travel expense (if the business was really the reason for

the travel home), and conceivably even some of his

living expenses at his home (his “secondary” home, in a

tax sense, since his primary home for tax purposes

would follow his work), might have been deductible, just

as his expenses for the office equipment that he purchased in his real estate business were. 1 Bittker & Lokken,

supra, ¶ 21.1.6, p. 21-21; see Sherman v. Commissioner, supra.

But he does not argue for such a deduction.
12 No. 08-2169

For completeness we note that if Wilbert’s wife had a

business in Minneapolis, this would make it all the

more reasonable for Wilbert not to move away from

Minneapolis. But it would not permit him to deduct his

traveling expenses, because his decision to live with his

wife (if only on occasional weekends) would (setting

aside any considerations relating to his real estate sideline) be a personal rather than a business decision. Hantzis

v. Commissioner, supra, 638 F.2d at 254 and n. 11 (“in this

respect, Mr. and Mrs. Hantzis’ situation is analogous to

cases involving spouses with careers in different locations. Each must independently satisfy the requirement that deductions taken for travel expenses incurred in

the pursuit of a trade or business arise while he or she is

away from home”); Chwalow v. Commissioner, 470 F.2d

475, 477-78 (3d Cir. 1972); 1 Bittker & Lokken, supra,

¶ 21.1.8, pp. 21-23 to 21-24; Rose & Chommie, supra,

§ 3.10, pp. 114-15.

The appeal presents some additional issues, but they

are adequately discussed in the Tax Court’s opinion.

AFFIRMED.

1-21-09