Canterbury v. Comm'r

T.C. Summary Opinion 2009-118
UNITED STATES TAX COURT
JESS WILLARD CANTERBURY, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 17393-06S. Filed July 28, 2009.
Jess Willard Canterbury, pro se.
William F. Barry, Jr., for respondent.
ARMEN, Special Trial Judge: This case was heard pursuant to
the provisions of section 7463 of the Internal Revenue Code in
effect at the time that the petition was filed.1 Pursuant to
section 7463(b), the decision to be entered is not reviewable by
1
Unless otherwise indicated, all subsequent section
references are to the Internal Revenue Code in effect for 2003,
the taxable year in issue, and all Rule references are to the Tax
Court Rules of Practice and Procedure.
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any other court, and this opinion shall not be treated as
precedent for any other case.
Respondent determined a deficiency of $2,768 in petitioner’s
Federal income tax for 2003.
After the parties’ concessions, the issue for decision is
whether petitioner is entitled to a deduction of $4,866 for
travel expenses under section 162(a)(2). The resolution of this
issue turns on whether petitioner’s “tax home” was in the New
York City metropolitan area (hereinafter, New York) or in or
around Jacksonville, Florida (hereinafter, Jacksonville). We
hold that petitioner’s tax home was in New York and, therefore,
that he is not entitled to the deduction in issue.
Background
Some of the facts have been stipulated, and they are so
found. We incorporate by reference the parties’ stipulation of
facts and accompanying exhibits.
When the petition was filed, petitioner resided in the State
of Florida.
In 2003 petitioner began working as a barge mate with
Reinauer Transportation Cos., L.L.C. (Reinauer). At that time,
and at all relevant times thereafter, petitioner resided in
Jacksonville.
As a barge mate, petitioner was responsible for the
operation and safety of the barge, including assuring that the
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barge was transported in water deep enough to support the barge’s
draft.
After being offered a job with Reinauer, petitioner reported
to New York on January 20, 2003, and proceeded to Reinauer’s
barge in Brooklyn, where he filled out paperwork for Reinauer and
began his first assignment. Petitioner remained employed with
Reinauer until sometime in 2005. Petitioner was not required by
Reinauer to reside in New York. Throughout 2003, petitioner
lived in Jacksonville, where his daughter also lived.
Following petitioner’s initial assignment, Reinauer’s
dispatcher called petitioner to tell him when and where to report
to his next assignment. Once notified of his assignment,
petitioner reported directly to the barge whether stationed in
New York Harbor; Boston, Massachusetts; Portland, Maine;
Providence, Rhode Island; or Yorktown, Virginia. When assigned
to a barge stationed in New York Harbor, which was the case for
most of his assignments,2 petitioner usually flew to Newark, New
Jersey, and took a cab to the barge. The one occasion on which
the barge was stationed in Virginia, petitioner drove from
Florida to the barge. When petitioner was assigned to a barge
2
Petitioner had 13 assignments during 2003. Six of the
assignments originated in New York Harbor; three in Portland,
Maine; two in Boston, Massachusetts; one in Yorktown, Virginia;
and one assignment, beginning Oct. 10, 2003, did not designate an
origin, but the barge floated through the Erie basin en route to
Albany, and thus that assignment most likely originated in New
York Harbor.
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stationed in Maine, Massachusetts, or Rhode Island, Reinauer
arranged for petitioner to fly out of Newark; thus, petitioner
flew from Jacksonville to Newark in order to board the flight to
the barge location.
When the barge was stationed outside New York Harbor,
Reinauer made arrangements for or reimbursed petitioner for the
cost of his travel from New York to the other port. On the one
occasion when petitioner drove directly to the barge from his
residence in Florida, Reinauer did not reimburse him for his
transportation expenses. Reinauer also did not reimburse
petitioner for his expenses in traveling between Jacksonville and
New York.
In traveling from his residence in Jacksonville to New York
to report to his barge assignments, petitioner incurred airline
fares, cab expenses, and tolls of $4,866.
Before working for Reinauer, petitioner worked in
Jacksonville as well as in other locations around the country.
During 2003 he chose to work for Reinauer in New York because the
pay was twice the rate for the same work in Jacksonville. In
addition, in New York, a barge mate worked 2 weeks on and 2 weeks
off, whereas in Jacksonville a barge mate worked 2 weeks on and
only 1 week off.
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Discussion
Generally, expenditures for transportation to and from a
taxpayer’s workplace are considered personal expenses and are not
deductible. Sec. 262; secs. 1.162-2(e), 1.262-1(b)(5), Income
Tax Regs. However, travel expenses may be deducted under section
162(a)(2) if they are: (1) Ordinary and necessary; (2) incurred
while “away from home”; and (3) incurred in pursuit of a trade or
business. Commissioner v. Flowers, 326 U.S. 465, 470 (1946).
The reference to “home” in section 162(a)(2) means the taxpayer’s
“tax home”.3 Mitchell v. Commissioner, 74 T.C. 578, 581 (1980);
Foote v. Commissioner, 67 T.C. 1, 4 (1976); Kroll v.
Commissioner, 49 T.C. 557, 561-562 (1968).
As a general rule, a taxpayer’s principal place of
employment is his tax home, not where his personal residence is
located, if different from his principal place of employment.
Mitchell v. Commissioner, supra at 581; Kroll v. Commissioner,
supra at 561-562. An exception to the general rule exists where
a taxpayer accepts temporary, rather than indefinite, employment
away from his personal residence; in that case, the taxpayer’s
personal residence may be his tax home. Peurifoy v.
3
The vocational “tax home” concept was first construed by
this Court in Bixler v. Commissioner, 5 B.T.A. 1181, 1184 (1927),
and has been steadfastly upheld by this Court. See, e.g., Horton
v. Commissioner, 86 T.C. 589 (1986); Leamy v. Commissioner, 85
T.C. 798 (1985); Foote v. Commissioner, 67 T.C. 1 (1976); Kroll
v. Commissioner, 49 T.C. 557 (1968).
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Commissioner, 358 U.S. 59, 60 (1958). Section 162(a) provides
that the taxpayer shall not be treated as being temporarily away
from home during any period of employment if such period exceeds
1 year. Similarly, if a taxpayer does not have a principal place
of employment, the courts have determined that his residence may
be his tax home. Johnson v. Commissioner, 115 T.C. 210, 221
(2000).
A taxpayer whose employer does not require him to travel may
not deduct transportation expenses, as they are more in the
nature of nondeductible personal commuting expenses.
Commissioner v. Flowers, supra at 473. “The exigencies of
business rather than the personal conveniences and necessities of
the traveler must be the motivating factors.” Id. at 474.
This Court has differentiated between deductible and
nondeductible transportation expenses, holding that a riverboat
pilot’s transportation expenses between his residence and points
of assignment and return were nondeductible commuting expenses,
whereas transportation expenses attributable to traveling
directly from one assignment to another were deductible. Heuer
v. Commissioner, 32 T.C. 947, 953 (1959) (taxpayer commuted from
his residence to more than 100 points of assignment and from one
assignment to another), affd. 283 F.2d 865 (5th Cir. 1960). The
distance a taxpayer commutes to work, no matter how far, still
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represents nondeductible commuting expenses under section 262.
Commissioner v. Flowers, supra at 473.
Although the subjective intent of the taxpayer is a factor
to be considered in determining tax home for purposes of
162(a)(2), this Court and others have consistently focused on
more objective criteria. Foote v. Commissioner, supra at 3-4.
Petitioner contends that his tax home was in Jacksonville,
as that was where he maintained a home and resided while he was
not working on Reinauer’s barges. Respondent argues that
petitioner’s tax home was not his residence in Jacksonville, but
rather in New York at his principal place of employment. We
agree with respondent.
In January 2003 petitioner began employment as a barge mate
with Reinauer and reported to New York, where he completed
paperwork and received his first assignment. Although each
assignment typically lasted a fortnight, petitioner remained
employed by Reinauer until 2005. Thus, his employment with
Reinauer was not temporary within the meaning of section 162(a)
in that he was employed for a period in excess of 1 year.
There is ample evidence in the record to support the
conclusion that New York was petitioner’s principal place of
employment. For each assignment, Reinauer’s dispatcher called
petitioner directly to inform him when and where to report to the
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barge for his next assignment, and petitioner reported directly
to the designated location. Most of petitioner’s assignments
originated in New York. If the barge was stationed in New York
Harbor, petitioner flew to Newark from Jacksonville to catch the
barge. If the barge was north of New York, in Maine,
Massachusetts, or Rhode Island, petitioner flew to Newark,
boarded another plane, and flew to the location of the barge.
Reinauer reimbursed petitioner for his transportation expenses
between New York and the northern locations but did not reimburse
him for travel between Florida and New York. For the one
assignment south of New York, in Virginia, petitioner drove his
personal vehicle to the barge at Yorktown and was not reimbursed
for such travel. This pattern of reimbursement indicates that
petitioner’s travel from Florida to New York was regarded by his
employer as a home-to-work commute.
Petitioner testified at trial that he took the job with
Reinauer because he received more pay for less work. Indeed, he
earned twice as much working as a barge mate in New York compared
with working in Jacksonville; moreover, following a 2-week work
period, petitioner received 2 weeks off rather than only 1 week.
Petitioner’s daughter also lived in Jacksonville. The rate of
pay, the time off, and the proximity to his daughter suggest that
it was personal choice and not business exigencies that dictated
the decision by petitioner to maintain his residence in
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Jacksonville and commute to New York. See Commissioner v.
Flowers, supra at 474.
Consequently, because petitioner’s position with Reinauer
lasted more than 1 year, and further because most of his
assignments originated in New York, his principal place of
employment, and therefore his tax home, was in New York for the
relevant period.
In conclusion, because petitioner was not “away from home”
within the meaning of section 162(a)(2), he is not entitled to a
deduction for expenses incurred for traveling between Florida and
New York. Instead, his costs were in the nature of personal
expenses for commuting. We thus sustain respondent’s
determination on this issue.
Conclusion
We have considered all of the other arguments made by
petitioner and, to the extent that we have not specifically
addressed them, we conclude that they are without merit.
To reflect our disposition of the disputed issue, as well as
the parties’ concessions,
Decision will be entered
under Rule 155.