Court Opinion

ID: 4624616
Source: CourtListenerOpinion
Date Created: 2020-11-21 02:55:31.663625+00
Date Added: 2024-06-11T07:56:33.746838
License: Public Domain

CHARLES J. TOBIN, PETITIONER, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT.Tobin v. CommissionerDocket No. 25922.United States Board of Tax Appeals17 B.T.A. 1261; 1929 BTA LEXIS 2158; November 6, 1929, Promulgated *2158  The compensation received by the petitioner during the year 1923 as counsel of the New York State Commission to Examine Laws Relating to Children, in which capacity he was an employee of the State of New York, was not subject to Federal income tax.  Lawrence Graves, Esq., for the petitioner.  R. Ritterbush, Esq., for the respondent.  MURDOCK *1261  The Commissioner determined a deficiency of $203.21 in the petitioner's income tax for the calendar year 1923.  The petitioner alleges that the Commissioner erroneously included in his taxable income for the year 1923, $2,250 received as compensation for services rendered as counsel of the New York State Commission to Examine Laws Relating to Children.  FINDINGS OF FACT.  The petitioner is an attorney at law residing at Albany, N.Y.In 1920 a bill was enacted in New York State which provided for the creating of the "New York State Commission to Examine Laws Relating to Children." This commission consisted of three senators, appointed by the temporary president of the senate; three members of the assembly, appointed by the speaker of the assembly; five persons to represent the public at large, *2159  appointed by the governor; and five persons to represent respectively the following five state departments or commissions, the head of each such department or commission appointing one such person: department of education, department of labor, department of health, state board of charities and state probation commission.  The general purpose of the commission was to study all laws relating to child welfare, investigate the operation and effect of such laws upon children, ascertain any overlapping or duplication of laws and the activities of any public office, department or commission thereunder, and make recommendations to the legislature of remedial legislation which it might deem proper as a result of its investigations.  The act authorized the commission to employ necessary assistants, as a part of its expenses.  In February, 1922, the commission appointed the petitioner as its counsel.  The appointment was made by the commission itself and was communicated to the petitioner merely by calling him to one of its meetings.  There was no written contract *1262  of employment.  The petitioner's appointment was not for any fixed period.  The services rendered by the petitioner*2160  during 1923 consisted of attending meetings of the commission which were held in various parts of the State, appearing before legislative committees and the governor in regard to proposed remedial legislation, and drafting bills.  In all his work he acted under the direction of this committee.  He received aid in the drafting of bills by conferring with the heads of the various departments represented on the commission and with other persons who he thought might be of particular aid to him, including his law partners.  The original act creating the commission called for a report to the state legislature at its next session.  In 1921, however, the act was amended so as to read, "The commission shall make reports of its proceedings annually to the legislature." The commission made reports down to and including the year 1926.  After that time, the legislature failed to make any further appropriation, although the act under which the commission was created was not repealed.  The petitioner's salary was fixed by the commission at $2,500 per year.  During the taxable year in question, 1923, the petitioner's income from the commission was $2,250.  The commission's pay roll was first approved*2161  by its chairman, then by the state comptroller, and finally was paid by check from the state treasurer.  During 1923 while the petitioner was acting as counsel for the commission, he was free to accept other employment.  He was not required by the commission to spend any specific number of days or hours on its work, but merely to perform his required duties in a reasonable time.  The commission did not instruct the petitioner how he should perform his work, but rather they merely assigned him the work and he had the general task of doing it.  OPINION.  MURDOCK: The petitioner contends that he was an employee of the State of New York, and that therefore his salary received as such employee was not subject to Federal income tax.  For a history of the provisions of the various revenue acts relating to the taxability of the compensation of state employees, see . It will be noted that the petitioner was engaged to do certain routine work for the commission.  He was not to perform any specific task or to accomplish any definite result.  Rather, he was to do whatever work was assigned to him by the commission. *2162  His work was continuous and in a sense was permanent.  Clearly, he was subject to the control of the commission, and although he *1263  was to use his skill in performing the various duties assigned to him, under the circumstances we hold that he was an employee of the State and not an independent contractor, and therefore, the salary which he received from the State is not subject to Federal income tax because to tax such income would be contrary to the law that the Federal Government may not tax the instrumentalities of a State.  ; affirmed in principle, ; ; ; . There is no deficiency.  Judgment will be entered for the petitioner.