Source: http://www.chanrobles.com/usa/us_supremecourt/338/258/case.php
Timestamp: 2019-10-18 16:01:03
Document Index: 655794893

Matched Legal Cases: ['§ 307', '§ 22', '§ 22', '§ 22', '§ 307', '§ 22']

COMMISSIONER V. CONNELLY, 338 U. S. 258 (1949) - US SUPREME COURT DECISIONS ON-LINE
US Supreme Court Decisions On-Line> Volume 338 > COMMISSIONER V. CONNELLY, 338 U. S. 258 (1949)
COMMISSIONER V. CONNELLY, 338 U. S. 258 (1949)
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A civil service employee of the Coast Guard who was enrolled temporarily during the war as an officer in the Coast Guard Reserve under the Coast Guard Auxiliary and Reserve Act, 14 U.S.C. § 307, but who served without compensation other than that of his civilian position and who performed after enrollment duties identical with those he had previously performed, is not entitled to the $1,500 exclusion from gross income provided by § 22(b)(13)(A) of the Internal Revenue Code in the case of compensation received "for active service as a commissioned officer" in the military or naval forces. Pp. 338 U. S. 258-262.
The Tax Court sustained the Commissioner of Internal Revenue's disallowance of a claim by a taxpayer for exclusion of $1,500 from gross income provided by § 22(b)(13)(A) of the Internal Revenue Code. 8 T.C. 848. The Court of Appeals reversed. 84 U.S.App.D.C. 260, 172 F.2d 877. This Court granted certiorari. 337 U.S. 924. Reversed, p. 338 U. S. 262.
The question we have here is whether respondent William I. Connelly, hereafter referred to as the taxpayer, is entitled to the $1,500 exclusion from gross income provided chanroblesvirtualawlibrary
by § 22(b)(13)(A) of the Internal Revenue Code. [Footnote 1] The taxpayer claimed this additional allowance for the taxable years 1943 and 1944. The Commissioner disallowed the sum deducted. The Tax Court sustained the Commissioner, 8 T.C. 848, and the Court of Appeals reversed, one judge dissenting. 84 U.S.App.D.C. 260, 172, F.2d 877. We granted certiorari. 337 U.S. 924.
On February 19, 1943, taxpayer was a civil service employee in the legal division of the Coast Guard. On that date, he was enrolled as a lieutenant commander within one of the six classifications which constituted the temporary members of the Coast Guard Reserve. [Footnote 2] His enrollment was under authority of the Coast Guard Auxiliary and Reserve Act, which provided for the enrolling of "persons (including Government employees without pay other than the compensation of their civilian positions)." 55 Stat. 12, as amended, 56 Stat. 1021, 14 U.S.C. § 307. On April 24, 1944, he was reenrolled as a commander, and his class was described as "Coast Guard Civil Service Employees."
After enrollment, taxpayer performed duties identical with those which he had previously performed. At the time he was enrolled, his civil service rating was P-5. Later this rating was raised to P-6, and his rank was increased at the same time to that of commander. He received the same pay after enrollment that he had received as a civil service employee. He received overtime pay as a civil service employee, deductions were made from chanroblesvirtualawlibrary
In Mitchell v. Cohen, 333 U. S. 411, we held that one employed in a department of the Federal Government as a civil service employee who was enrolled temporarily in the Volunteer Port Security Force of the Coast Guard Reserve and who worked part-time as a reservist without pay was not an "ex-serviceman" within the meaning of the Veterans' Preference Act. Looking to the legislative history of that statute, we found that the overshadowing purpose of the Act was to favor those who had a real record of military service.
The Court of Appeals found in this case that, by the application of "long established criteria -- oath of office, military duty, and subjection to military discipline," taxpayer had acquired a military status, and was thus entitled to the exclusion. We agree that he had a military status chanroblesvirtualawlibrary
for some purposes. But the question for tax purposes is whether he received his pay in that status. To come within § 22(b)(13)(A), he must have received his compensation "for active service as a commissioned officer." We understand this to mean that, if taxpayer received his pay as a commissioned officer, he would be entitled to the exclusion. It seems equally plain that, if he received his pay as a civil service employee and served without military pay and allowances, he is not entitled to the claimed exclusion. [Footnote 3] As in the Cohen case, the emphasis of the statute is on a military, and not on a civilian, status.
"advisable to clarify this authority [enrollment of temporary members without the pay of their military rank] and resolve any doubt of its applicability to Government employees by specifically providing for temporary membership in the Coast Guard Reserve of Government employees without military pay but with continuance in their civilian positions and the receipt of the compensation thereof. [Footnote 4]"
From the date of the enactment of the enrollment statute, there seems to have been no deviation from the view chanroblesvirtualawlibrary
The Court of Appeals ignored the status in which taxpayer was compensated and gave effect to his military status which was provided only to facilitate the performance of his duties in wartime. [Footnote 5] Taxpayer's rank was for the purpose of getting the job done, and not for the purpose of receiving compensation.
These classifications and the organization of the Coast Guard Reserve are detailed in Mitchell v. Cohen, 333 U. S. 411, 333 U. S. 412-414.
See Judge Edgerton, dissenting in part, below:
". . . I would be unable, in view of the rule that tax exemptions are strictly construed, to say that the compensation of a man who did not receive a commissioned officer's pay, but served 'without pay other than the compensation of [his] civilian positions' was 'received . . . for active service as a commissioned officer.' 84 U.S.App.D.C. at 263, 172 F.2d 880."