Evening star., 1941-03-24
Court Upho|ds
j. ). Workers in
DC. TaxAppeaI
Employees Claiming
DomiciIe Elsewhere
Ruled Exempt
BACKGROUND

D1C II dAOO ~ u
Amount OF reUenue TO be de-
riUed from District income tar
has been in doubt since Sweeney
decision on the Intangible prop
erty tar. In this decision it 1U1S
held that q Justice Department
empJOye, 1COrking here, 1UdS not
subject TO the tar since he held
permanent residence in MdSS1-
chuSeHS Decision lrdS generally
held 10 be applicable TO income
tar Fire thousand persons sub
SeQuently hare paid the District
income tar under formal protest.
Attempts to reUiSe the income
tar ldW to make it apply to all
incomes earned here lCere turned
dorm recently by House COM
nltttee.
In two decisions today. the United
States Court of Appeals decided
that Federal employees on duty here,
claiming a permanent home else
where. are exempt from the District
of Columbia income tax.
The cases involved Paul M. De
Hart, chief clerk of the Personnel
and Organization Division of the
National Guard Bureau, War De-
partment. who protested a payment
of S1636 for local income tax, on
his showing that he is domiciled in
Harrisburg. Pa. and Henry G.
Murphy, economist in the Treasury
Department. who contended his
domicile is in Detroit and protested
a tax payment of S2555.
Both men paid income taxes here
for the year ending December 81.
1899. and on their contention of
domiCile elsewhere. their protest was
upheld by the Board of Tax Appeals
for the District of Columbia.
Greater Difficulty Seen.
Corporation Counsel Keech sad
the opinion of the Court of Appeals
in the Dehart and Murphy cases
would make administration of the
local income tax law even more
difficult than heretofore"
He said ne would study the opinion
before deciding whether it would be
advisable to seek a review by the
Supreme Court
Mr.. Keech expressed the belief
that the decision unquestionablv
would influence" others who had
paid the tax TO make application for
a refund Existing law he explained.
allows two years in which TO file q
claim for a refund"
/ From what l have been told about
the courts opinion" he said, 1T ap-
pears that there is a strong presenta-
ton as to Government employees
when they come TO the District to
serve the Federal Government. and
the rebuttal presentation will re-
qulre uneQuivocal evidence indi-
eating an intention 10 abandon the
original domicile.
The picture could be different II
the taxpayer is not in the Govern
ment service
/ 10000 Believed Affected.
| Declaring it would be impossible
| TO make an accurate estimate of the
| number Of Government employees
who might be affected by today's
decision. District tax officials said
they believed it unlikely the total
would exceed 10000
I would be surprised if the figure
ran that high one officer on the
income tax division said.
I He pointed out that only about
| $500 persons filed claims for refund
on their income tax payments last
year These claims involved tax
payments totaling s65 900.
! Tax Assessor Edward A. Dent has
denied approximately 100 appeals
/ for refund by persons claiming
| domiclle elsewhere. and only about
100 of these have appealed their
cases to the Board of Tax Appeals.
District legal experts took the view
| that today's decision could not be
! considered blanket exemption for
all Federal employees with legal resi-
dence in the States, and said they
would continue their past policy OF
deciding each case on its own merits.
At the same time. however, tax Of
! flcials expressed fear that the ap-
] pellate courts action might have
the effect of deterring Government
| employees from filing their local re-
turns on 1910 income. These are due
April Is
Filing Under Protest Advised.
/ They added, however, they would
continue to advise all Government
workers TO file their 194l returns un-
der protest. They pointed out that
if the appellate courts ruling is re-
versed those who did not file returns
would be liable to penalties.
Some 20 of the 100 cases which
were appealed to the Board of Tax
Appeals after being turned down by
/ the tax assessor have been acted on
by 10 V. Morgan, sole member of
the appeals board and the remainder
have been placed on the reserve
calendar pending decision in the
cases before the courts
1t was pointed out at the District
(See INCOME TAX. Page A-4)