Court Opinion

ID: 4481729
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:15:03.813801+00
Date Added: 2024-06-11T14:54:00.906970
License: Public Domain

Dkennen, /., concurring: I think that to allow the deduction sought by petitioner would require us to go beyond permissible limits in allowing the deduction of “extra” personal living expenses, which the taxpayer incurs by his own choice and for his own benefit, under the guise of travel expenses incurred while away from home in the pursuit of a trade or business. In the past this Court has frequently considered this issue to be a factual issue with the conclusion depending on the particular circumstances involved. In doing so, I think we have gradually extended the principles of law on which the deduction of such expenses might be allowable and have undermined the provisions of the law which disallow the deduction of personal living expenses. I am glad that Judge Simpson recognized this in this case and has taken a hard look at where those decisions were leading. Section 262 of the Code specifically disallows the deduction of personal living expenses. There can 'be no question that the expenses here involved are of the type normally considered to be nondeductible personal living expenses. However, it is recognized that expenditures of this nature may be deductible if they take on the additional character of travel expenses incurred while away from home in the pursuit of a trade or business. But, it was firmly established by the Supreme Court in Commissioner v. Flowers, 326 U.S. 465 (or at least so I thought), that for expenditures of this nature to be allowable to an employe© they must be incurred “while traveling,” “while away from home,” and “in pursuit of business,” which was said to mean “that there must be a direct connection between the expenditure and the carrying on of a trade or business of the taxpayer or his employer. Moreover, such an expenditure must be necessary or appropriate to the development or pursuit of the business or trade.” If this was an issue of first impression, I would have difficulty in recognizing that expenditures for food and lodging while teaching school for 9% months in one location could be said to be expenses incurred “while traveling.” However, I realize that the Courts have long accepted being temporarily away from home in the pursuit of a trade or business as being in a travel status for this purpose even though the taxpayer is not constantly on the move. The second condition stated by the Supreme Court in the Flowers case is that the expenses must be incurred while “away from home.” Petitioner argues that the expenditures are deductible as “away from home” expenses because his employment was intended to be “temporary” rather than “indefinite” or “permanent.” I recognize that this test has been used when an employee is sent to a temporary post of duty by his employer, and where the nature of the employment is temporary in itself, and I agree that it is relevant under those circumstances. However, I do not believe this has been used as a criterion where the nature of the job is not temporary and where the post of duty or principal place of employment has been chosen by the employee himself rather than his employer. To allow the deduction simply because the taxpayer decides for ‘himself that he will take a job away from home for only 9% months or 1 school year makes a mockery out of the principle applied by this and other Courts time and again in the “away from home” cases, and which is recognized by petitioner here, that a man’s home for tax purposes is considered to be in the vicinity of his principal place of employment. See cases cited in the majority opinion and the discussion and cases cited in Commissioner v. Stidger, 386 U.S. 287, but cf. Burns v. Gray, 287 F. 2d 698 (C.A. 6). In addition, the “temporary” versus “indefinite” employment question usually arises only where work at a new place of employment would cause a shift from one tax home to another. See Peurifoy v. Commissioner, 358 U.S. 59, affirming per curiam 254 F. 2d 483. If we consider this taxpayer’s business to be that of being a schoolteacher, no such shift occurred. Petitioner had never taught school in Knoxville or any place else before he took the teaching position in Georgia. The third condition expressed in Flowers is that the expense must be incurred in pursuit of business, that there must be a direct connection between the expenditure and the carrying on of the trade or business of the taxpayer or his employer, and that it must be necessary or appropriate to the development and pursuit of the business. Obviously the expense can be “incurred in pursuit of a business” only if there is a business to which the expenses are proximately related. Sec. 162(a). Such business may be that of an employer or the taxpayer himself, but it cannot be a business in which taxpayer merely intends, desires, or expects to engage in at some future time. Quite clearly, petitioner’s meals and lodging expenses in Georgia and North Carolina were not incurred in carrying on the school districts’ business, because as far as the school districts were concerned, petitioner’s personal wish to return to Knoxville was not related to their business. Petitioner’s personal expenses for meals and lodging were no different from those of the other teachers who moved their families to, and became residents of, the community which they served. It can be no more successfully argued in this case that petitioner’s extra living expenses were incurred in the pursuit of his employer’s business and were directly related to the prosecution of that business than it was in the Flowers case. Thus we are left with the question whether these expenses were incurred in pursuit of, had a direct connection with the carrying on of, and were necessary or appropriate to the development and pursuit of, a trade or business of the taxpayer individually. Certainly it cannot be said that petitioner’s expenditures for food and lodging were necessary or directly connected, or were beneficial, to the jobs petitioner was employed to perform. Petitioner or someone else could have performed the jobs whether they were living away from home or not. In my opinion, the only way in which these expenditures could even remotely be considered incurred in and necessary to a trade or business of the petitioner is by recognizing that petitioner’s business was that of being an employee, which is a concept relied on more and more by this Court in recent years to permit the deduction of personal living expenses. When the Supreme Court said in Flowers that there must be a direct connection between the expenditure and the carrying on of the trade or business of the taxpayer, in my opinion it was referring to a trade or business actually conducted by the taxpayer in his individual capacity rather than for someone else, and that it did not have in mind the carrying on of the business of being an employee. Otherwise, it would have discussed this concept, because certainly Flowers was as much in the business of being an employee as is petitioner here. However, while I believe this concept can lead to unwarranted and unintended results, its use may be justified if the expenses considered to be incurred in tbe pursuit of that business are limited to those directly related to and for the benefit of the job the taxpayer is employed to perform. But I do not believe the statutory provisions will permit the deduction of personal living expenses incurred by a taxpayer for his own convenience in order to obtain and retain a job as an employee simply because he, subjectively, considers the job to be temporary so far as he is concerned. It seems to me we would be embracing the affirmative of the above concept to reach the conclusion petitioner seeks. In my opinion, to so extend the employee-business concept distorts the purpose and meaning of section 162, makes almost meaningless, for any employee who wants to live in one place and work elsewhere, the provisions of section 262, and flies directly in the face of the conclusion reached by the Supreme Court in Commissioner v. Flowers, supra. If we were to allow the deduction sought here, I would view it as an open invitation to any schoolteacher, retired legal stenographer (see Virginia C. Avery, T.C. Memo. 1970-269), or other person who wants to live one place and work at “temporary” jobs away from his residence, to claim as deductions the personal living expenses he incurs while attending his out-of-town employment. Of course, if all such deductions were allowed it would result in inequity and discrimination against those schoolteachers or fellow employees, working side by side, who live in the vicinity of their jobs and are not permitted to deduct their living expenses. In view of the uncertainty and confusion caused by the seemingly inconsistent positions sometimes taken by the lower courts in cases involving this issue, I suggest that either the Supreme Court (which has approached it but backed off on several occasions, see Peurifoy and Stidger, both supra) or Congress should define more specifically what is meant by the word “home” when used in the context of travel expenses while away from home in the pursuit of a trade or business. I agree that the deductions for petitioner’s living expenses while teaching school in Georgia and North Carolina should be denied. Tietjens, Foeeestek, Scott, Fbatheeston, and Quealy, JJ., agree with this concurring opinion.