holding that a taxpayer has no tax home if “he continuously travels and thus does not duplicate substantial, continuous living expenses for a permanent home DECISION TC-MD 190312N 6 maintained for some business reason”
How later courts described this case
- holding that a taxpayer has no tax home if “he continuously travels and thus does not duplicate substantial, continuous living expenses for a permanent home DECISION TC-MD 190312N 6 maintained for some business reason”
- taxpayer home during "idle time" but worked most nights touring with Disney On Ice
- requiring that the permanent home be “maintained for some business reason”
- applying the three objective factors identified
Written by the judges who cited it.
The opinion
KOZINSKI, Circuit Judge,
dissenting.
The Tax Code provides that travel expenses are fully deductible, so long as they are incurred while “away from home” in the pursuit of business. I.R.C. § 162(a)(2). Henderson fits comfortably within this language. He lived with his parents in Boise, which made their home his home under any reasonable definition of the term. And he incurred travel expenses in pursuing a job that moved from town to town. ‘Given the itinerant nature of his employment, Henderson could not have avoided these travel expenses by moving his home closer to work. He is thus easily distinguished from the taxpayer in Hantzis v. Commissioner, 638 F.2d 248 (1st Cir.1981), who could have avoided the travel expenses altogether by moving closer to her work. Hantzis’s extra-statutory requirement that a home is not a “tax home” unless dictated by business necessity has no application when the job itself has no fixed location.
The other reasons offered by the IRS for denying Henderson his traveling expense deduction are not supported by the Code or the regulations, nor. do they make any sense. That Henderson’s parents did not charge him room and board is of no consequence. Neither the Code nor common experience requires that a taxpayer pay for his home, else all minors and many in-laws would be deemed homeless. “Home” is not a term of art; it is a common English word meaning a permanent place where a person lives, keeps his belongings, receives his mail, houses his dog — just as Henderson did. Indeed, a grown son living in his parents’ house is said to be living “at home.” Whether he compensates his parents in cash, by doing chores or through filial affection is none of the Com-' missioner’s business. What matters is that, by going on the road in pursuit of his job, Henderson had to pay for food and lodging that he would not have had to buy had he stayed home.
James v. United States, 308 F.2d 204 (9th Cir.1962), cuts against the government. Despite some imprecise language in the opinion, the facts there were very different. George James was on the road 365 days a year and had no permanent home; he spent his entire life traveling from hotel to motel.' Wherever a weekend or holiday found him, he would stay there until it came time to go to his next location. James thus was, indeed, a tax turtle — someone with no fixed residence. *502 Henderson is very different: He had a home in Boise, a place where he returned when he wasn’t working. He was no more a tax turtle than anyone else who travels a lot- for' business. That his home happens to be owned by his parents makes it no less his home. 1
Fast planes and automobiles have turned us into a nation of itinerants. The tradition of families living together in one city, even under one roof, is sadly disappearing. Yet there is virtue in keeping families together, in parents who welcome their adult children under their roof. Leave it to the IRS to turn a family reunion into a - taxable event. Henderson is being hit with extra taxes because his lifestyle doesn’t conform to the IRS’s idea of normalcy. But why should the government get extra money because, the Hendersons chose to let their son live at home? Had they given him $600 a month to rent an apartment next door, Henderson surely would have gotten the travel deduction. I see no reason why the Henderson family ought to be penalized because the parents gave their son a gift of housing rather than cash — or why the Commissioner should be the beneficiary of this parental generosity. If Congress had said it must be so, I would bow to its wisdom. But Congress said no such thing and I do not feel bound to give the same deference to the Commissioner’s litigating position. 2 Given the dearth of authority or common sense supporting the Commissioner’s view, we are free to encourage happy family arrangements like those between Henderson and his mom and dad. In the -name of family values, I respectfully dissent.
. James's emphasis on duplication of expenses is unnecessary to the holding, and mistaken to boot. Duplication is one possible method of sifting out business expenses from personal ones, but not the method chosen by Congress. Section 162(a)(2) requires only that the taxpayer be away from home in pursuit of business; meals, for example, are fully deductible even though the expense is not duplicated back at home.
. Revenue Ruling 73-529 is entitled to some deference — exactly how much is unclear — but certainly far less than the statutesque deference we give regulations. See Estate of McLendon v. Commissioner, 135 F.3d 1017, 1023-24 (5th Cir.1998); First Chicago NBD Corp. v. Commissioner, 135 F.3d 457, 459-60 (7th Cir.1998). Because the Service cannot easily recant a position after a ruling is published, it has reason to be overly stingy in drafting. Institutional pressures may also drive the Service to stretch the language of the Code; it's easier for the Executive Branch to have the Service milk more revenue out of the existing Code than to persuade Congress to amend it. Moreover, unlike most regulations, Revenue Rulings are not subject to the notice-and-comment procedures of the Administrative Procedure Act. Ruling 73-529 sweeps too broadly to be persuasive here: Under the Ruling, Henderson would get no deduction even if he spent ten months a year at home instead of ten weeks, simply because he paid no rent.