TAX COURT OPINION

Case: Glen Tremayne Morgan
Docket Number: 7695-17S
Judge: Carluzzo
Opinion Type: bench
Filed: 04/27/2018
Pages: 8

RMM UNITED STATES TAX COURT WASHINGTON, DC 20217 GLEN TREMAYNE MORGAN, Petitioner, v. ) ) ) ) Docket No. 7695-17S COMMISSIONER OF INTERNAL REVENUE, Respondent. ) ) ) ORDER Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is ORDERED that the Clerk of the Court shall transmit herewith to petitioner and to respondent a copy of the pages of the transcript of the trial in the above case before Chief Special Trial Judge Lewis R. Carluzzo at Denver, Colorado, containing his oral findings of fact and opinion rendered at the trial session at which the case was heard. In accordance with the oral findings of fact and opinion, a decision will be entered under Rule 155. (Signed) Lewis R. Carluzzo Special Trial Judge Dated: Washington, D.C. April 27, 2018 SERVED Apr 27 2018 Bench Opinion by Special Trial Judge Lewis R. Carluzzo 3 April 18, 2018 Glen Tremayne Morgan v. Commissioner of Internal Revenue Docket No. 7695-17S The Court has decided to render oral findings of fact and opinion in this case and the following represents the Court's oral findings of fact and opinion (bench opinion). Section references made in this bench opinion are to the Internal Revenue Code of 1986, as amended, in 1 2 3 4 5 6 7 8 9 10 effect for the relevant periods, and Rule references are 11 12 13 14 to the Tax Court Rules of Practice and Procedure. This bench opinion is made pursuant to the authority granted by section 7459(b) and Rule 152. This proceeding for the redetermination of a 15 deficiency is a small tax case subject to the provisions 16 of section 7463 and Rules 170 through 174. Pursuant to 17 18 19 section 7463(b) the decision entered in this case shall not be treated as precedent for any other case. Glen Tremayne Morgan appeared on his own behalf. 20 Michael Thomas Garrett appeared on behalf of respondent. 21 22 In a notice of deficiency dated January 13, 2017 (notice), respondent determined a deficiency in 23 petitioner's 2015 Federal income tax. Petitioner now 24 concedes the adjustment giving rise to the deficiency. We 25 must decide whether petitioner is entitled to various cribers 4 1 2 3 4 5 6 7 8 9 itemized deductions, intended to be, but not claimed on petitioner's timely filed 2015 Federal income tax return (original return). Those deductions are shown on one or the other of amended returns submitted to, but not processed by respondent after the notice was issued. Some of the facts have been stipulated and are so found. At the time the petition was filed, petitioner was a resident of Colorado. During the year in issue, and for many years 10 prior, petitioner was an employee of a company or 11 12 companies that provided asbestos remediation services to its customers. Petitioner's job mostly involved removing 13 existing flooring that contained asbestos in commercial 14 and residential buildings. During 2015, he donated some 15 of the flooring supplies left over from various jobsites 16 to the Pikes Peak Habitat for Humanity Restore (Restore). 17 18 19 20 21 The items donated are shown on a receipt Restore provided to petitioner at the time of the donation. During 2015 petitioner had no regular place of employment. Instead, upon instructions from his employer received prior to or on the day of an assignment, 22 petitioner used his car to travel to the location of his 23 24 25 employer's customer that required his services. His employer did not reimburse petitioner for the costs to do so. Petitioner noted the days and locations he traveled VCribers en34522solopetemeemihea,mitwwwememue 5 1 2 3 4 5 6 7 8 9 on handwritten sheets of looseleaf paper. These notes show the dates, locations and, in some entries, the name of the customer. The mileage between his residence and the jobsite as shown on his notes was determined with reference to MapQuest. Petitioner's travel notes show that he worked at approximately 25 jobsites during 2015, and that he drove a total of 18,968 miles to do so, although the deduction he claimed on an amended return for mileage exceeded the 10 mileage shown on his notes. The distance between 11 petitioner's residence and the jobsites, according to his 12 notes, varied from 20 miles to 58 miles, with a majority 13 of the jobsites being 50 miles or less from his residence. 14 15 16 At trial petitioner called the Court's attention to an IRS publication that addresses deductions for travel to temporary jobsites. The Court treated that document as 17 petitioner's pretrial memorandum and had it filed as such. 18 That document provides a sufficient explanation of the 19 applicable law and we see no need to repeat that analysis 20 21 22 23 24 25 here. All of petitioner's jobsites were "temporary", but as petitioner's pretrial memorandum correctly points out, taxpayers such as petitioner, who have no regular place of employment, may only deduct travel expenses to temporary jobsites if the jobsite is outside of the metropolitan area where the taxpayer lives and normally works. Schurer bers 6 1 2 3 4 5 6 7 8 9 v. Commissioner, 3 T.C. 544 (1944); Rev. Rul. 99-7, 1999-1 C.B. 361. Expenses incurred by a taxpayer to travel to temporary jobsites within the taxpayer' s metropolitan area are treated as non-deductible personal commuting expenses. See sec. 262; Fausner v. Commissioner, 413 U.S. 838, 839 (1973); Commissioner v. Flowers, 326 U.S. 465, 473-474 (1946); sec. 1.262-1(b)(5), Income Tax Regs. These rules, at least to some extent, undermine petitioner's claim to the mileage deduction because the 10 record does not clearly show the extent of the 11 metropolitan area in which petitioner lived and routinely 12 worked. But we think it would be unfair to deny the 13 entire deduction because we lack that specific 14 15 information. Because the deduction is for mileage, the 16 written substantiation requirements of section 274 and its 17 18 corresponding regulation apply, and we note that respondent questioned the reliability of the notes 19 petitioner kept in an apparent attempt to satisfy those 20 21 22 requirements. During petitioner's cross examination at trial, questions by respondent's counsel suggested that the notes were not contemporaneously made, as required by 23 the statute and as petitioner claimed, but apparently made 24 after the fact based upon his recollection or reference to 25 other materials not made available to the respondent or cribers 7 the Court. We have given serious consideration to the implications of respondent's concerns, but we are satisfied from the structure of the notes coupled with petitioner's testimony that the notes are reliable enough, and contain sufficient information to meet the requirements of section 274. That is not to say, however, that petitioner is entitled to a deduction for the mileage shown on his notes. Instead, keeping in mind the rules applicable to temporary jobsites as discussed above, and without any evidence in the record that establishes the extent of the 1 2 3 4 5 6 7 8 9 10 11 12 metropolitan area where petitioner lived and routinely 13 worked, we supply that definition with reference to miles 14 driven as shown in petitioner's notes and acknowledge that 15 our approach lacks the precision we would otherwise 16 prefer. 17 Taking into account the information shown on 18 petitioner's notes, we find that travel to jobsites 40 19 miles or less are within the relevant metropolitan area 20 21 22 23 and petitioner is not entitled to a deduction for travel to those jobsites. More likely than not, some of the jobsites shown to be more than 40 miles from petitioner's residence would be considered inside the relevant 24 metropolitan area, and some would not. In the absence of 25 specific evidence on the point, we find that petitioner is cribers $73½(cid:16)06022Soloperatmaemeennet|wwwescrbetsmet 8 1 2 3 4 entitled to a deduction for one-half of those miles. Taking into account the above findings, we'll leave it up to the parties to calculate petitioner's allowable deduction for travel by applying the relevant standard 5 mileage rate to the number of miles petitioner traveled to 6 7 8 9 10 11 12 jobsites outside of the relevant metropolitan area as now defined. As for petitioner's entitlement to the charitable contribution deduction here in dispute, we find as follows: 1. On the basis of petitioner's testimony and the receipt petitioner received from Restore, we find that 13 petitioner donated the items shown on the receipt. 14 15 2. The receipt issued by Restore is not a "contemporaneous written acknowledgment" as required in 16 section 170(f)(8) because it lacks a statement as to 17 whether the done organization provided any goods or 18 19 20 21 22 services to petitioner in return for the contribution. 3. The fair market value of the items purchased donated to Restore totaled at least $249, 4. In the absence of the required contemporaneous written acknowledgment, section 23 170(f)(8) (A) limits petitioner's allowable charitable 24 25 contribution deduction to $249. That being so, we find that petitioner is ribe øn>4maso!.pmene.whumi!.w.maems»« 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 4 I 9 entitled to a $249 charitable contribution deduction for the items donated to Restore. To reflect the foregoing and petitioner's concessions, decision will be entered under Rule 155. This concludes the Court's bench opinion in this matter. (Whereupon, at 4:06 p.m., the above-entitled matter was concluded.) ectibers 97334%2250loperationseerrbersnetlawwescrhesme