# Petition — Felton v. Commissioner > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385011_1462%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition - **Published:** January 1, 1984 - **Citation:** 466 U.S. 972 ## Text Office - Supreme Court, U.S 83-1401 FILED FEB 21 1984 ALEXANDER L. STEVAS. CLERK No. IN THE SUPREME COURT OF THE UNITED STATES October Term, 1983 DONALD C. FELTON AND MARIANNE V. FELTON, Petitioners Vv. COMMISSIONER OF INTERNAL REVENUE, Respondent PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT WILLIAM W. OLIVER IU School of Law Bloomington, IN 47405 812-335-3939 PATRICK LOUIS BAUDE IU School of Law Bloomington, IN 47405 QUESTION PRESENTED Whether in determining the tax home under Section 162, I.R.C., of a wife, the wife should be treated the same as an unmarried person: thereby ignoring factors such as the employment situation of her husband; their ownership for thirteen (13) years of a residence in the city where her husband is employed; that it is feasible for her to perform most (but not all) of her duties to her employer in the city of the marital residence; tnat it would cost five times as much for her to live in an apartment in the other city as to rent transient facilities for the sixty (60) nights each year that she had to stay overnight in the other city; that she could not ii obtain employment in her field of expertise in the vicinity of the marital residence; and that her husband could not join her in a move of the marital residence unless he resigned his position, thereby suffering a dimunition of retirement benefits. ill TABLE OF CONTENTS Page Question Presented ......e.-. i Gpanione Belew .. « sé 6 6+ © 6 8 2 DEP SORICEILOR & 6.644 So 6 6 we 2 Constitutional and Statutory Provesions Involved ..s+#-.«eeees 3 meeceeent. OF €he Caee ..s1tvees 4 Reasons for Granting Review ... 8 Le The Decision in This Case of the Seventh Circuit is in Conflict With a Decision of the Second Circuit — . * a. *. . . . a > >. 8 oe This Case Presents an Appropriate Vehicle to Reach the "Home" Issue in a Limited Context .. 14 es ee This Case Can be Disposed of GUSGEAY 6 a4 +. 2. 4 eS 8 16 IV. The Issue in the Case is Smpeortent « « «ee + ee 6 20 V. Tnat This is a Small Tax Case Merits Favorable Con- ren ~ .« “o "aine. « 6 « -e ES) ee a ey ae ee INDEX TO APPENDICES Appendix A. Order, Court of Appeals for the Seventh Casemst ss s+ « 2s «3s Cee. Pr Appendix B. Opinion of the United States Tax Court ... Appendix C. Order. Petition for Rehearing Denied .... Appendix D. Excerpts from Briefs 26 27 26 28 Vv TABLE OF AUTHORITIES CITED Cases Page Comm. v. Stidger, 386 U.S. 287, 87 Ct. 1065, 18 L Ed 2d 53 (1967) . . . . . . . . >. . . * 9 Daly v. Comm. 631 F.2d 351, (4th Cats, 2000) ~s « « « 19,22,24 ,25 Flowers v. Comm., 326 U.S. 465, 66 S&S. Ct. 250, 90 L BA 203, reh den 326 U.S. 812, 66 S. Ct. 482, 90 L.Ed 496 ik ~~ 6-6 = = =. = «© « « Delbull Peurifoy v. Comm., 358 U.S. 59, 79 S. Ct. 104, 3 L Ed 2d 30, reh den 358 U.S. 913, 79 S. Ct. 227, 3 L.Ed 2d 234 [ames « © & 6 & 6 ee © 8 ec 9 Rosenspan v. United States, 438 F.2d 905 (2d Cir. 1971), cert. denied, 404 U.S. 864 (1971), reh'g denied, 404 ems See CEPrae « 6 6s ce ww eM Six v. United States, 450 F.2d con er. See 6 6 «¢..« « oh, Statutes Internal Revenue Code Sec. 162... 3 38 46 34 34 55 29 vi Miscellaneous Brookiyh Law Review, 1285 (1972) St. Johns Law Review 540 (1972) South Carolina Law Review 829 (1983) The Tax Lawyer 829 (1980-81) Texas Law Review 645 (1977) University of Florida Law Review 119 (1976) 122 University of Pennsylvania Law 49 18 Review 859, (1974) Virginia Law Review 125 (1963) Wake Forest Law Review 99 (1982) a | No. IN THE SUPREME COURT OF THE UNITED STATES October Term, 1983 DONALD C. FELTON and MARIANNE V. FELTON, Petitioners Vv. COMMISSIONER OF INTERNAL REVENUE, Respondent PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT The petitioners Donald C. Felton and Marianne V. Felton respectfully pray that a writ of certiorari issue to review the judgment and unpublished order of the United States Court of Appeals for the Seventh Circuit entered in this proceeding on October 21, 1983, a OPINIONS BELOW The unpublished order of the Court of Appeals appears as Appendix "A" hereto. The Memorandum findings of fact and Opinion of the United States Tax Court appears as Appendix "B" hereto. The order denying the Petition for Rehearing appears as Appendix "C" nereto. JURISDICTION The order of the Court of Appeals for the Seventm Circuit was entered on October 21, 1983. A timely Petition for Rehearing with Suggestion for Rehearing in banc was denied on November 22, 1983, and this petition for certiorari was filed within 90 days of that date. This Court's jurisdiction is invoked under 28 U.S.C, @ 1254(1). STATUTORY PROVISIONS INVOLVED I.R.S. § 162. Trade or business expenses (a) In general. - There shall i allowed as a deduction all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business, including - (1) a reasonable allowance for salaries or other compensation for personal services actually rendered; (2) traveling expenses (including amounts expended for meals and lodging other than amounts which are lavish or extravagant under the circumstances) while away from home in the pursuit of a trade or business; and (3) rentals or other payments required to be made as a condition to the continued use or possession for purposes of the trade or oes business, of property to which the taxpayer has not taken or is not taking title or in which he has no equity. For purposes of the preceding sentence, the place of residence of a Member of Congress (including any Delegate and Resident Commissioner) within the State, congressional district, or possession which he represents in Congress shall be considered his home, but amounts expended by such Members within each taxable year for living expenses shall not be deductible for income tax purposes in excess of $3,000. STATEMENT OF THE CASE Appellant Marianne V. Felton (her Ph.D. in Economics almost completed) in 1978, could not find employment as an economist in or within commuting aBn distance of Bloomington, Indiana, where she and her husband owned a residence in which they had lived with their children for about 13 years. She accepted employment in 1978 in New Albany, Indiana (about 100 miles away), at Indiana University Southeast (a regional campus), only after her employer-to-be agreed her classes would be bunched so she would need stay overnight in New Albany only two nights each week, so that she could return to Bloomington where most of her work (class preparation, research and reading to keep current) was done and where she could use the superior library and computer facilities at the main campus of Indiana University. She did not teach in the summer, and worked many more hours in Bloomington than in New Albany. elles Her husband had held a staff position at the main campus of Indiana University in Bloomington, Indiana, since 1965, and if he resigned in 1978 to move to New Albany before completing 15 years of service he would have suffered a diminution in retirement benefits. During the period in controversy (August 15, 1978 to December 31, 1978), Mrs. Felton slept as a transient in New Albany for 30 nights (2 nights for each of 15 weeks) and the rest of the time she lived at the established marital residence in Bloomington, Indiana. In New Albany she paid five dollars ($5.00) a night to a widow for sleeping privileges in one of the bedrooms in the widow's residence. It would have cost at least five times as much for Mrs. Felton to have rented, furnished and maintained an apartment in New Albany. afte The petitioners deducted the traveling expenses to New Albany for the period August 15 through December 31, 1978 on their federal income tax return. The Commissioner disallowed the deduction of these expenses, and the petitioners sought a redetermination of that disallowance in a petition to the U.S. Tax Court. The U.S. Tax Court found that the petitioners' tax home was in New Albany during the period August 15, 1978 through December 31, 1978 and that as a result the traveling expenses for that period could not be deducted. The Court of Appeals for the Seventh Circuit affirmed in an unpublished Order. The petitioners are placed at some disadvantage in stating the question presented by the fact that neither the Tax Court nor the Seventh Circuit answered their arguments. The Tax Court a x did in its footnote 6 say "While petitioner's (sic] point (problem of families with spouses employed in different cities] perhaps is appealing sociologically, it has no basis in law." In the Appendix "D" there are a few excerpts from arguments made in briefs filed in this case to show that the question presented to this Court was presented to the Tax Court and the Seventh Circuit. REASONS FOR GRANTING REVIEW I. THE DECISION IN THIS CASE OF THE SEVENTH CIRCUIT IS IN CONFLICT WITH A DECISION OF THE SECOND CIRCUIT. The unpublished order of the Seventh Circuit acknowledged this conflict. At page 4 the order states, "For purposes of the travel expense deduction, a taxpayer's ‘home' is the place of his or ~~ her business rather than the place of u4 residence. This is footnote 4: “We note that the Supreme Court has never decided this guestion and that the Second Circuit disagrees with this court's position on the issue of the location of a taxpayer's ‘home.' See Six v. United States, 450 F.2d 66 (2d Cir. 1971); Rosenspan v. United States, 438 F.2d 905 (2d Cir. 1971), cert. denied, 404 U.S. 864 (1971), reh'g denied, 404 U.S. 959 (1971). Indeed this Court itself has on three occasions recognized the conflict between the circuits about the definition of "home," Flowers v. Comnm., 326 U.S. 465, 472 (1946); Peurifoy v. Comm., 358 U.S. 59, 60 (1958); and Comm. v. Stidger, 386 U.S. 287, 291 (1967). However, in each of these cases the Court decided the case on other grounds, nie and did not have to try to formulate a definition for the word "home" in Sec. 162. Not only has this Court recognized the existence of this conflict about the meaning of the word "home," but also commentators have often discussed this conflict in legal periodicals, see, e.g., 38 Brooklyn L.R. 1285, (1972); 122 U. Pa. L.R. 859, 922 (1974); 46 St. Johns L.R. 540, 541 (1972); 29 U. Fla. L.R. 119, 126-8 (1976); and 49 Va. L.R. 125, 161 (1963). Petitioners could cite many cases on each of the respective sides of the question, is home, home or place of business under Sec. 162, I.R.C. Petitioners choose not to do so. Compilations of cases can be found at 29 U. Fla. L.R. 119, 126-8 (1976) and 49 Va. L.R. 125, 131-6 (1963). As will be seen in the argument below, petitioners ali« rely primarily upon the conflict between circuits on the meaning of home in the context of spouses employed in different cities. Petitioners promise (if certiorari is granted) not to advance in the argument any attempted all encompassing definition of "home" under Sec. 162. The failure to grant certiorari in Rosenspan is no reason for denying certiorari in this case. Rosenspan and Six present two different contexts about the relationship of home to place of business. In Rosenspan the taxpayer was an unmarried traveling salesman who traveled almost constantly, had no home, and wanted to call his employer's place of business his home. The appeal of the taxpayer's plight in Rosenspan is very limited: while he incurs transient type expenses, having no home, those expenses are not duplicative and, if he prevails, éi@e almost all his costs during a year fcr meals and lodging become deductible. Six presents a context of a wite employed away from an established marital residence, as does the present case. In that case, Ethel Merman (a famous actress) had in 1953 married Mr. Six, President of Continental Airlines, with headquarters in Denver. They purchased jointly a residence in the Denver area, which was the single marital residence at least through 1958. On December, 1958 she went to New York City to perform in a play, "Gypsy." Her expenses in New York City in the taxable year 1959 were at issue. The district court had decided the refund suit before the Second Circuit had adopted its "home is home" test in Rosenspan and accordingly the Second Circuit remanded for further proceedings and findings in light of Rosenspan. The oi) 3= citations do not reveal any furtner Opinions in Six, and clearly this Court has not denied certiorari in a case involving a conflict about the meaning of home in the context of spouses employed in different cities. While the Second Circuit did not decide the factual guestion of where the home was in Six, it is clear it believed marriage counts, for it mentioned "her marriage to Mr. Six, who continued to live in the Englewood home" as a relevant factor. 450 F.2d 66, 70. There can be no reasonable doubt that the petitioner would have prevailed before the Second Circuit in an appeal from the Tax Court. If that court remanded for further proceedings and findings about where her home was, despite the fact Mrs. Six had a one year lease in New York, spent only a few days in June, 1959 at the marital residence, aha and was divorced from Mr. Six in December of the next year, then a fortiori, it would decide a finding that Mrs. Felton's home was in New Albany, Clearly erroneous, when she spent only 60 nights in 1978 in New Albany as a transient and had a home the rest of the year with her husband in Bloomington and at the time of the trial (if I may go outside the record, to the present time) she and her husband were devoted to each other. II. THIS CASE PRESENTS AN APPROPRIATE VEHICLE TO REACH THE "HOME" ISSUE IN A LIMITED CONTEXT. As noted in the first reason for granting the writ (conflict between circuits), this Court has had before it three cases in which it acknowledged the conflict about the meaning of "home, " but decided the case on another ground at S.. without reaching the issue as to the meaning of “home." Petitioners believe that this case is one in which the "home" issue, limited to the context of two earner families, will have to be reached if certiorari is granted. Both courts below have decided the case on the "nome is place of business" premise. If the Commissioner decides to avoid an argument before this Court on "home" in this case because he prefers to argue it in a future case on a record in which the wife rents an apartment in the other city for the academic year, he may try to shift the argument and ask that this case be decided on an "exigencies of the business "test" i.e., the third test in Flowers, supra. The petitioners' answer to that argument, if made, will be: She is married, and you must look at the employments of both husband and wife and aie their joint efforts as man and wife to produce a flow of income to support the consumption and the savings, if any, of a family unit and its members. Thus it appears this case presents a record on which, if the writ is granted, this Court will have to face the relevance of marriage to travel expense cases, whether it be under the second or third tests of Flowers, supra. Further, petitioners have difficulty seeing how marriage could be relevant to one of the tests, without also being relevant to both. III. THIS CASE CAN BE DISPOSED OF QUICKLY. Leading cases such as Flowers, Supra, arose at a time when husbands were usually gainfully employed and wives were infrequently employed outside the home. In a case where only the = husband was employed, it is natural to refer to the exigencies of "his" job. One facet of the petitioners' argument that in a two earner family, you must look at “their” employments because they are engaged jointly in an effort to earn income to support the family as a consumption unit (and to the extent there are savings, an investing unit) and combine with that a fundamental aspect of our society: we favor a wife and her husband living together in a single residence. Petitioners believe it to be self evident that consideration of marriage and the legitimate employment concerns of one's spouse is relevant to a traveling expense issue. Perhaps the decisions of tne two courts below can be explained by a reluctance to be the first court to draw a new distinction between one earner and two earner -18-_ couples, faced with a host of cases referring to "his" job and "his" place of business in situations where only tne husband was employed. Furthermore, tne failure to respond to the petitioners' arguments may be explained by a reluctance to be in a position to be quoted as saying "marriage doesn't count." But this Court is under no restraints in drawing a distinction between one earner and two earner families, and if this Court should reverse, a pro family posture would enhance the image of the Court. If this Court grants certiorari, this case should not reguire much of this Court's time if it concludes as a rule of law that marriage is relevant in a case of two spouses employed in different cities and then that it was clearly erroneous to decide in this case that Mrs. Felton's "tax home" was in New a} 9- Albany. The lower courts could on a case by case basis develop a body of “two earner traveling expense” law with this Court probably not having to join the issue again. One nuance in the proceedings below was sympathy for the petitioners' plight. The Tax Court footnote saw their argument "appealing sociologically," and there is this sentence from the brief of the appellee before the Seventh Circuit, "Although we sympathize with taxpayers' plight and that of similarly situated families, any relief in this regard, as pointed out by Judge Murnaghan in his concurring Opinion in Daly, can only come from the Congress." This is tantamount to an argument that the courts have painted themselves into a corner so that “marriage doesn't count," even though the courts below «25a were reluctant to state that explicitly. This Court can obviously Say that marriage is relevant in a two earner traveling expense case, for the law about traveling expenses is of judicial origin. Assuming for purposes of argument that some Courts of Appeal (but not the Second Circuit) believe they are in corner, this Court is the perfect tribunal to disabuse those courts of the belief that marriage is irrelevant in a two earner traveling expense issue. IV. THE ISSUE IN THE CASE IS IMPORTANT. Two trends in our society make the issue in this case one of inecennine importance. First, an increasing percentage of wives work and second, an increasing percentage of women have specialized qualifications for which =2) = employment is not readily available in almost every area, in contrast to employments such as secretaries, waitresses, elementary school teacners, and store clerks. Indeed the facts in this case are likely to emerge as the typical case, i.e., the wife witn a bachelor's degree whose husband has an established position and who goes back for an advanced degree. Once she has an advanced degree she may have to 100k to another geographical area for employment utilizing her ee education. Recent articles, comments and notes in legal periodicals reflect the importance of the traveling expense deduction in the context of two earner family. In Popkin, "Deduction of the Traveling Expenses by the Two Worker Family," 55 Texas L. Rev. 645 (1977), the author starts his article with this sentence, “As it has become more common =%2~ for both spouses to work, an ability to deduct additional expenses tnat result from the decision of both husband and wife to work has increased in importance." He suggests (for married persons) as a test for the deductibility of traveling expenses “what could reasonably be expected of a married individual." One of his premises is that the usual life style of married persons is to live together and that this is recognized by various provisions in the Internal Revenue Code. Some recent writing about the two earner family has been a reaction to Daly v. Comm., which, while distinguishable, has some similarity to this case. There were two Daly Opinions, the first, 631 F.2d 35l, (4th Cir., 1980) by a three judge panel and the second after a rehearing en banc. The similarity of Daly to this case is o§Ga that Mr. Daly obtained a sales territory which did not include the site of the Marital residence. His wife had a sestvion as manager of a store in the general vicinity of the marital residence. Thus Mr. Daly faced a problem similar to Mrs. Felton in the present case -- whether to move away from the existing marital residence. Both Mr. Daly and Mrs. Felton accommodated to the spouse's employment and kept a single marital residence, rather than setting up a separate, second home. Mr. Daly did some office work at the marital residence, but unfortunately for him the selling could be done only in the territory -- and the hours worked in the territory were at least twice as many as the hours of work at the marital residence. Mrs. Felton, Since she could do her research, class preparation, and reading to keep current > in her field in the vicinity of the Marital residence, worked more than twice as many hours at the marital residence as she dia in New Albany. One aspect of the Daly case was that the husband did not argue that "his wife's legitimate employment concerns should play a role in determining where his tax home should be fixed." We do make the argument here that her husband's legitimate employment concerns must be considered in determining Mrs. Felton's tax home. Daly produced a sharp division among the judges of the Fourth Circuit. The first decision was for the taxpayer by a 2 to 1 vote. On the rehearing en banc nine judges participated: five joined in the majority opinion, Judge Murnaghan concurred in an opinion that in some ways reads more like a dissent, and three judges dissented. If the position =4S0 of Senior Circuit Judge Field, who voted for the taxpayers in the first Daly Opinion, but did not sit on the en banc rehearing, is taken into account the vote is five for the majority, one judge concurring, and four judges in dissent. "Comment - Daly v. Commissioner: Effect of the Tax Home Rule Under Section 162 on Two-Earner Families," 34 The Tax Lawyer 829 (1980-1) is a comment on the first Daly opinion. The author found shortcomings in the legal analysis, but that "its outcome may be justifiable on social policy grounds." The conclusion of the author was "that two-earner spouses who cannot avoid working in different cities should be granted traveling expense deduction... In the Winn and Winn, "Till Death Do We Split: Married Couples and Single Persons under the Individual Income =26< Tax," 34 S. Car. L.R. 829, 864 the authors see the first Daly as a case "departing from settled rules, (but] recogniz(ing] sociological and demographic change." A case note on the second Daly Opinion, 18 Wake Forest L.R. 99 (1982) sees tne result as involving “harsh consequences" for a salesman with a territory, instead of a single pjlace to work. V. THAT THIS IS A SMALL TAX CASE MERITS FAVORABLE CONSIDERATION. The amount of tax at issue in this proceeding is slightly more than $700. Such cases are likely to arise in the academic world since much of the work of a professor may be performed at any place where there are adequate library and other research facilities available. The tax deficiencies will a typically be small, so that the cost of litigation through to this Court will typically be far greater than the amount of the tax deficiency. If the Court does not grant certiorari in this case to address the conflict between circuits in the context of a two earner family, there may not be another opportunity for the Court to resolve the conflict until a case arises involving spouses in top tax brackets, such as a famous actress and the president of a large corporation. CONCLUSION For these reasons, a writ of certiorari should issue to review the judgment and unpublished order of the Seventh Circuit. Respectfully submitted, YE WILL W. OL R IU School of Law Bloomington, IN 47405 APPENDIX A UNITED STATES COURT OF APPEALS For the Seventh Circuit Chicago, Illinois 60604 Submitted: September 7, 1983* Octoper 21, 1983 Before Hon. Richard D. Cudahy, Circuit Judge Hon. John L. Coffey, Circuit Judge Hon. Joel M. Flaum, Circuit Judge DONALD C. FELTON and Appeal from MARIANNE V. FELTON, the United Petitioners-Appellants, States Tax Court No. 82-1540 vs. No. 3120-80 William M, COMMISSIONER OF INTERNAL Fay, Judge. REVENUE, Respondent-Appellee. This is an appeal from a decision of the United States Tax Court upholding the appellee Commissioner's disallowance of certain travel expenses deducted by 1 the appellant, Marianne V. Felton, for the taxable year 1978. Felton v. Commissioner, 43 T.C.M. (CCH) 278 (1982). We affirm. Ii. During the period in question, the Feltons resided in Bloomington, Indiana. Mr. Felton worked in Bloomington and his wife was completing her Ph.D. in economics at Indiana University. During the academic years 1976-1977 and 1977-1978, Mrs. Felton worked on a temporary basis as a visiting lecturer at Indiana University Southeast (IUSE), located in New Albany, Indiana. New Albany is approximately , 100 miles from Bloomington. The Feltons lived in Bloomington while Mrs. Felton was a visiting lecturer at IUSE. @ For the 1978-1979 academic year, appellant accepted a permanent, tenure-track position at IUSE, after unsuccessfully attempting to find satisfactory employment closer to Bloomington. Appellant did not move to New Albany, Dut continued to reside in Bloomington. Mrs. Felton's duties as a professor included teaching classes, preparing for Classes, holding office hours to meet with students and doing research. The university provided appellant with an office and a classroom in New Albany to perform her duties. To minimize the expense of traveling to New Albany, appellant arranged her schedule so that her classes and office hours were on Monday nights, Tuesday mornings, Wednesday nights and Thursday mornings. ~ Mrs. Felton stayed overnight in New Albany on Mondays and Wednesdays and Spent the rest of the week in Bloomington. Appellant calculated that She worked 22 hours a week in New Albany and 30 hours a week in Bloomington. The researcn facilities available in Bloomington were more extensive than those in New Albany. Many of the materials available in Bloomington could be acquired by the New Albany library using the inter-library loan system, but certain journals and books were unavailable through inter-library loan. Economics professors at IUSE generally traveled to Bloomington three or four times a year to use the research facilities there. A computer center was also located in Bloomington, wnich Mrs. Felton considered essential to her work. From August, 1978 tnrough December, 1978, appellant incurred expenses of $1,701.03 in traveling between Bloomington and New Albany and in securing overnight lodging twice a week. The Tax Court held that the expenses were nondeductibdble commuting costs. The court found that Mrs. Felton's tax "home" was New Albany, not Bloomington. The expenses at issue could not be deducted, the court ruled, because Mrs. Felton was not away from “home" when they were incurred. This appeal followed. kids The starting point for analyzing the deductibility of traveling expenses under § 162(a) of the Internal Revenue Code” is Commissioner v. Flowers, 326 U.S. 465 (1946). The Supreme Court set forth three conditions which must be satisfied before travel expenses are deductible: (1) the expense must be reasonable and necessary; (2) tne expense must be incurred wnile away from home; and (3) the expense must be incurred in the pursuit of business. Id. at 470. The taxpayer must meet all three requirements for the expense to be deductible. The purpose of the deduction for business travel expenses is "to mitigate the burden of the taxpayer who, because of the exigencies of his trade or business, must maintain two places of abode and thereby incur additional and duplicate living expenses." Kroll v. Commissioner, 49 TeC. 557, 562 (1968). Whether or not a particular expenditure satisfies all three conditions "is purely a question of fact in most instances. And the Tax Court's inferences and conclusions on such a factual matter, under established principles, should not be disturbed by an appellate court." Flowers, 326 U.S. aa at 470 (citations omitted). See also Michel v. Commissioner, 629 F.2d 1071, 1073 (5th Cir. 1980); Coombs v. Commissioner, 608 F.2d 1269, 1274 (9th Cir. 1979); 4A Mertens, Law of Federal Income Taxation § 25.93 (1979). The Tax Court's findings will not be disturbed on appeal unless clearly erroneous. Fed. R. Civ. P. 52(a); 26 U.S.C. y 7482(a); see Commissioner v. Duberstein, 363 U.S. 278, 291 (1960). The Tax Court's findings in the instant case are supported by the record. For purposes of the travel expense deduction, a taxpayer's “nome" is the place of his or her business rather than the place of residence. Weiberg v. Commissioner, 639 F.2a 434, 437 (8th Cir. 1981); Michel v. Commissioner, 629 F.2d at 1073; Markey v. Commissioner, 490 F.2d 1249, 1253 (6th Cir. 1974); England v. United States, 345 F.2d 414, 417 (7tn Cir. 1965), cert. denied, 3382 U.S. 986 (1966). Cf. Daly v. Commissioner, 662 F.2d 253 (4th cir. 1981); Jones v. United States. 648 F.2d 1081 (6th Cir. 1981); Hantzis v. Commissioner, 638 F.2d 248 (lst Cir. 1981), cert. denied, 452 U.S. 962 (1981); Coomos v. Commissioner, 608 F.2d 1269 (9th Cir. 1979). Appellant claims that her "nome" during the taxadle year in question, within the meaning of I.R.C. 9 162(a)(2), was Bloomington. Her argument is based primarily upon her claim that she performed more work in Bloomington (30 hours per week, on tne average) than in New Albany (22 hours per week). But it is not the place where work is performed, but rather the requirements of the taxpayer's business as to where the taxpayer must work that is determinative in ascertaining the be: nin location of a taxpayer's "home." "The exigencies of business rather tnan the personal conveniences and necessities of the traveler must be the motivating factors." Flowers, 326 U.S. at 474. In this case, the only location where appellant was required to work was in New Albany, where she taught classes and neld office hours for students. Her decision to do work in Bloomington was ba.ed primarily upon personal convenience, not upon business necessity. Her husband was working in Bloomington and the Feltons had a home there. Appellant's employer did not require her to live in Bloomington nor did it reguire that she work in Bloomington. Compare United States v. Blanc, 278 F.2d 571 (5th Cir. 1960) (state supreme court justice required by law to live in one community and work in another). o1O= Appellant asks this court to adopt a "reasonableness to move" test. Under the proposed approach, the deductibility of the travel expenses at issue would depend on whether it was reasonable to expect Mrs. Felton to move ner residence to New Albany after accepting the permanent position at IUSE. We decline to adopt this argument for the reasons stated in Kasun v. United States, 671 F.2d 1059, 1062 (7th Cir. 1982). Tnere was sufficient evidence for the Tax Court to find that Mrs. Felton's tax "home" was New Albany. The expenses at issue in this case are not deductible under § 162(a)(2) because appellant was not away from that "nome" when those expenses were incurred. Appellant's expenses were nondeductible commuting expenses. For the foregoing oneuden, the decision of the Tax Court is AFFIRMED. -ll- *After preliminary examination of the briefs, the court notified the parties tnat it nad tentatively concluded that oral argument would mot be helpful to tne court in tnis case. The motice provided that any party might file a "Statement as to Need of Oral Argument." See Rule 34(a), Fed. R. App. P. (effective Aug. 1, 1979); Circuit Rale 14(£). Petitioner-appellants nave filed such a statement and requested oral argument. Upon consideration of that statement, the briefs, and the record, the request for oral argument is denied and the appeal is submitted on the briets and record. lappellant, Donald C. Felton, husband of Marianne V. Felton, is a party to this action because he and his spouse filed a joint federal income tax return for the year in question. Further references to "appellant" are to Mrs. Felton. 2For the academic years 1974-1977 and 1977-1978, the Commissioner allowed taxpayer to deduct travel expenses between Bloomington and New Albany because her job was "temporary." Those expenses are not at issue in the instant appeal. 3section 162(a)(2) of the Internal Revenue Code of 1954, as amended, provides as follows: § 612. Trade or business expenses (a) In general.--There shall be allowed as a deduction all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business, including-- -l2- (2) traveling expenses (including amounts expended for meals and lodging other than amounts which are lavisn Or extravagant under the circumstances) while away from home in the pursuit of a trade or business. 4We mote that the Supreme Court nas never decided this question and that the Second Circuit disagrees with this court's position on the issue of tne location of a taxpayer's "nome." See Six v. United States, 450 F.2d 66 (2d Cir. 1971); Rosenspan v. United States, 438 F.2qa 905 (2a Cir. 1971), cert. denied, 404 U.S. 864 (1971), ren'g denied, 404 U.S. 959 (1971). «130 APPENDIX B QQ IR” ~ Wana UNITED STATES TAX DONALD C. FELTON and MARIANNE V. Felt Petitioners V. COMMISSIONER OF INTERNAL REVENUE ~ Respondent Docket No. 3120-80. William W. Oliver, for the petitioner Deborah Gehring, for the MEMORANDUM FINDINGS OF FAC’ AND OPINION FAY, Judge: Respondent determined deficiencies of $1,354.00 and $1,429.63 in petitioners' Federal income tax for 1977 and 1978, respectively. The only issue for decision is whether certain travel expenses incurred in 1978 are non-deductible personal expenses or «lé@- Ordinary and necessary business expenses deductible under section 162.2 FINDINGS OF FACT Some facts have been stipulated and are found accordingly. Petitioners, Donald C. Felton and Marianne V. Felton, were residents of Indiana when they filed their petition in this case. In 1961, Donald C. Felton retired from the army, and petitioners moved to Bloomington, Ind., so he could attend Indiana University. After obtaining a degree, he accepted employment with Indiana University in Bloomington and remained in that position through the years in issue. In 1968, Marianne V. Felton (hereinafter petitioner) enrolled in Indiana University in Bloomington and received her Master's degree in 1971. -15- Her specialty is cultural economics. She was unable to find satisfactory employment in that field in the immediate Bloomington area. For a while, she taught part-time in Indianapolis, which is about 50 miles from Bloomington. During «he academic years 1976-1977 and 1977-1978, petitioner was employed On a temporary basis as a Visiting Lecturer in Economics at Indiana University Southeast in New Albany, Ind. While New Albany is approximately 100 miles from Bloomington, petitioner did not move her personal residence to New Albany.” For the academic year 1978-1979 {August 15, 1978, to May 15, 1979), petitioner obtained a full-time, permanent position at Indiana University Southeast in New Albany. From August through December 1978, she was a =16« Lecturer. Effective January 1979, sne became an Assistant Professor of Economics--a promotion which carried not Only the benefits of a salary increase but the benefits of tenure credit as well. Her promotion resulted from her successful completion of a Ph.D. in Economics at Indiana University in Bloomington in December 1978. Although petitioner's employment in New Albany became permanent in August 1978, she still did not move her personal residence there. Petitioner arranged her schedule whereby she taught on Monday nights, Tuesday mornings, Wednesday nights and Thursday mornings, and she maintained office nours in New Albany on those days. With that schedule, petitioner was able to limit her nights in New Albany to two each week. Thus, she would drive to New Albany on Monday, return to Bloomington ni Pa on Tuesday, drive to New Albany on Wednesday, and return to Bloomington on Thursday. On the nights sne stayed in New Albany, petitioner rented a room. Petitioner calculates that she spent an average of 22 hours each week working in New Albany. As a lecturer at Indiana University Southeast, petitioner was expected to do scholarly research as well as to teach classes.” Some of her preparation and most of her research was done in Bloomington. By petitioner's calculation, she spent an average of 30 hours each week working in Bloomington. Petitioner's research was aimed at tnree related goals: (1) keeping abreast of developments in her field; (2) completing her doctorate dissertation; and (3) preparing scholarly articles and papers. The library facilities at Bloomington are =16~ more expansive than tnose at New Albany. While materials could be obtained by the New Albany library from the Bloomington library through inter-library loan, some journals and reference books were unavailable through that system. There was also a computer center in Bloomiagton which petitioner considered essential to her work. In general, professors in the Indiana University Southeast Economics Department made three or four trips to Bloomington each year to use the facilities there. From August 1978 through December 1978, petitioner incurred expenses of $1,701.03 traveling between New Albany and Bloomington. In his statutory notice of deficiency, respondent disallowed the deduction of those expenses.” o19~ OPINION The issue presented is whether expenses incurred by petitioner Marianne V. Felton in traveling between Bloomington and New Albany from August 1978 through December 1978 are section 162 ordinary and necessary ousiness expenses or section 262 nondeductible personal expenses. Respondent contends petitioner's “tax home" was New Albany, and the expenses she incurred were nondeductible commuting expenses. Respondent also maintains since petitioner's choice to live in Bloomington was personal, the expenses were not incurred in the pursuit of a trade or business. Petitioner contends Bloomington was her "tax home," and her expenses are deductible as “away from home" traveling expenses under section 162(a)(2). Additionally, petitioner argues the «30= deduction should be allowed, because it was unreasonable to expect ner to move her personal residence to New Albany. Section 162({a)(2) permits a taxpayer to deduct traveling expenses, including meals, lodging, and transportation, incurred while “away from home" in the pursuit of a trade or business. See also Commissioner v. Flowers, 326 U.S. 465, 470 (1946). The purpose of that deduction is “to mitigate tne burden of the taxpayer who, because of tne exigencies of his trade or business, must maintain two places of abode and thereby incur additional and duplicate living expenses." Kroll v. Commissioner, 49 T.C. 557, 562 (1968) (emphasis added). Thus, it is the expenses arising from business considerations that fall within section 162(a)(2). With that in mind, this Court has consistently interpreted =Zi« "home," as it is used in section 162(a)(2), as referring to the vicinity of a taxpayer's principal place of business, rather than to the taxpayer's personal residence. Mitchell v. Commissioner, 74 T.C. 578 (1980); Montgomery v. Commissioner, 64 T.C. 175 (1975), affd. 532 F.2d 1088 (6th Cir. 1976); Coerver v. Commissioner, 36 7.c. 252 (1961), affd. 297 F.2d 837 (3d Cir. 1962). In determining a taxpayer's "home," an objective test applies. Foote v. Commissioner, 67 T.C. 1 (1976). While that test has occasionally been stated as an inguiry into whether it would be reasonable for a taxpayer to move his personal residence to the vicinity of the business location under consideration, that does not mean that subjective elements, such as personal preference or family location, come into oo play. See generally Tucker v. Commissioner, 55 T.C. 783 (1971). See also Frederick v. United States, 603 F.2d 1292 (8th Cir. 1979). In the case before us, we find petitioner Marianne V. Felton's tax "nome" was in New Albany during the period in issue. The focal point of a university lecturer's duties is teacning in the classroom and dealing with Students. Those duties take place almost exclusively on campus. While research is an integral part of the job, in most cases it can be accomplished principally on campus. We are unconvinced this case is any different. Petitioner's teaching and interaction with students occurred in New Albany. While some of her research necessarily was done in Bloomington, most of it could have been done in New Albany. It appears to us petitioner chose to center “23 her researcn activities in Bloomington for personal reasons. Those reasons can play no part in the determination of her tax "home." As the Circuit Court of Appeals for the Eighth Circuit said, "The job, not the taxpayer's pattern of living, is the crucial matter." Frederick v. United States, supra at 6 1295. Having found petitioner's tax "home" was New Albany, the expenses at issue herein cannot be deducted under section 162(a)(2) simply because petitioner was not away from that "home" when those expenses were incurred.’ Viewed as expenses of traveling from Bloomington to New Albany, petitioner's expenses are nondeductible costs of commuting. Commissioner v. Flowers, supra. To reflect concessions and the foregoing, Decision will be entered under Rule 155. 24- lall section references are to the Internal Revenue Code ot 1954, as amended. during tne academic years 1970-1977 and 1977-1978, petitioner incurred expenses of $5,128.53 traveling between Bloomington and New Albany. For purposes of this case, respondent concedes that during those years petitioner's employment was temporary, and her travel expenses are thus deductible. 3Petitioner's dissertation was completed in early November 1978 and successfully defended on December 4, 1978. l . . . . *There were also some minor administrative duties attached to petitioner's employment. 2In his statutory notice of deficiency, respondent also disallowed the deduction of travel expenses incurred by petitioner during the academic years 1976-1977 and 1977-1978. As previously noted, respondent now concedes the deductibility of those expenses because petitioner's employment during those years was temporary. Sas part of her “reasonable to move" argument, petitioner argues that failure to consider personal elements in a case such as hers puts undue strain on two job families. While petitioner's point perhaps is appealing sociologically, it has no basis in law. See Foote v. Commissioner, 67 T.C. 1, 6-7 (1976); Tucker v. Commissioner, 55 T.C. 783, 788 (1971). See also Daly v. Commissioner, F.2d, 48 AFTR2d 81-6008, 81-2 U.S.T.C. 4 9721 (4tn Cir. 1981) (Murnaghan, Jr., concurring), revg. 631 F.2d 351 (4th Cir. 1980), and affg. 72 T.C. 190 (1979). Having found that petitioner's expenses are not deductible under sec. 162(a)(2) because -25- she was not "away from home," we do not address respondent's argument concerning "in pursuit of a trade or business."’ However, see the discussion in Commissioner v. Hantzis, 638 F.2d 248 (lst Cir. 1981). Spetitioner makes no argument concerning the deductibility of any transportation expenses for traveling from her tax "home," New Albany, to Bloomington to do any research which could not be done in New Albany. Therefore, we do not address that question. However, see Chappie v. Commissioner, 73 T.C. 823, 828-829 (1980), and note concession made in Montgomery v. Commissioner, 64 T.C. 175 (1975), attd. 532 F.2d 1088 (6th Cir. 1976). -20- APPENDIX C UNITED STATES COURT OF APPEALS For the Seventh Circuit Chicago, Illinois 60604 November 22, 1983 Before Hon. Richard D. Cudany, Circuit Judge Hon. Jonn L. Coffey, Circuit Judge Hon. Joel M. Flaum, Circuit Judge DONALD C. FELTON and Appeal from MARIANNE V. FELTON, the United Petitioners-Appellants, States Tax Court No. 82-1540 vs. No. 3120-80 William M. COMMISSIONER OF INTERNAL Fay, Judge. REVENUE, Respondent-Appellee. ORDER On consideration of the petition for reharing and suggestion for rehearing in banc filed in the above-entitled cause =2J= panel have voted to deny a rehearing Accordingly, aa) ’ rr : ‘ e IT IS ORDERED that the aforesaid petition for renearing be, and the same 1s nereby, DENIED. -28- APPENDIX D QUOTATIONS TO SHOW QUESTION PRESENTED BRIEF FOR APPELLANTS, SEVENTH CIRCUIT Page l. "Maintenance of a Single marital residence should be an objective of the law, even including tax law. Page ll. "Perhaps as a result of ignoring... the petitioner's (sic] arguments about the relevance of marital obligations to a "tax home" issue, the [Tax] Court failed to find various uncontroverted facts relevant to the petitioners’ argument, such as, e.g., that ner husband Colonel Felton could in the fall of 1978 have joined her in a move to New Albany and obtain -29- employment in that Vici eo ~ ct kK: Only by Tesigning from the Staff of Indiana University and Suffering a Jjiminution of his retirement benerits from tnat Page 15. “(The author] ie, Suggests (for Married persons) @S a4 test for the fecuctibility Of travel ©*penses what could rh reasonably be expected o " married individual. REPLY BRIEF FOR THE APPELLANTS, SEVENTH CIRCUIT Page + "In effect the POSition of the Service and the Tax Court is that you can't for Personal [i.e,, desire to live with her husband in their established marital residence) ~Siie reasons contract to do the majority of your work away from the place you teach. ‘The appellants’ position is that when the employment duties are such that they do not have to be performed in any particular place, married persons should be encouraged to do as mucn work as is feasible under their employment responsibilities in the vicinity of the marital residence when it is not feasible for their spouse to change employment and move the marital residence," AMICUS BRIEF OF THE AMERICAN ASSOCIATION OF UNivERSITY PROFESSORS BEFORE THE SEVENTH CIRCUIT Page 2. "This case involves the application of these =3i- principles to tne two-worker housenold. It is unreasonable to expect a working wife to Separate from her husband and abandon the marital domicile. . - »« We therefore urge the court to adopt a rule tnat permits the deduction of traveling expenses whenever the taxpayer-spouse is traveling to the secondary or minor place of work of the marital unit. BRIEF FOR THE PETITIONERS, U.S. TAX COURT Page als "Reasonable choice of a nome under all the circumstances must include the Circumstances of a taxpayer's marriage." = |} REPLY BRIEF FOR PETITIONERS, U.S. TAX COURT Page 7. “Comm. v. Flowers, 326 U.S. 465 (1946) involved a high bracket taxpayer, whose wife did not work, and who wanted a tax deduction to help subsidize the extra cost arising from his and his wife's choice not to move the marital residence to the area where he was pursuing his profession. The instant case involves the SErvice wanting a working wife at prohibitive, wasteful cost to establish a residence away from the marital residence where her husband is working, even though under the arrangement with her employer it is feasible for her to spend five nights a week at home with her husband and do > oO TT . a) _— Ww i = ‘ ; > = a ry j r-4 4 4 “ . ¥ Ma I c- 7 > ! v 4 “G4 iJ i) hu "” - ~ A --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385011_1462%3A1. Public record. Not legal advice.