Opinion
Docket No. 95301.
1963-11-25
ARTHUR SANSONE AND RAYDA JO SANSONE, PETITIONERS, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT
Arthur Sansone, pro se. Frank E. Phillips, for the respondent.
Arthur Sansone, pro se. Frank E. Phillips, for the respondent.
In 1959, petitioner was regularly employed at Sycamore facility, a division of General Dynamics Corporation, located about 9 miles from the General Dynamics plant in San Diego City. He worked at Sycamore for 5 years. Because there is no public transportation, petitioner drove in his own car daily between his residence and Sycamore. Held: (1) Petitioner was transferred to Sycamore in 1956; it became his regular and only place of employment; he was not temporarily assigned to work there. (2) Petitioner's daily trips to work were in the nature of commuting between his home and place of employment, the unreimbursed expenses of which were not business expenses under section 162(a), 1954 Code, but were nondeductible personal expenses under the rule of Commissioner v. Flowers, 326 U.S. 465, 470.
HARRON, Judge:
Respondent determined a deficiency in income tax for 1959 in the amount of $252. The question is whether automobile expense in the amount of $1,260 is nondeductible personal expense, or business expense deductible under section 162(a), 1954 Code. Petitioner claims a deduction for the expense of driving daily between his residence and place of employment. Some of the facts have been stipulated.
FINDINGS OF FACT
The stipulated facts are so found and are incorporated herein by reference.
Petitioners filed a joint return with the district director of internal revenue in Los Angeles, Calif. Arthur Sansone is referred to hereinafter as the petitioner.
General Facts
Petitioner is now employed by General Dynamics Corporation. Since 1953, he has been employed continuously by Convair Corporation, which merged with General Dynamics, and by General Dynamics, except for a leave of absence of 9 months prior to 1955 when he was employed by the United States Air Force. The merger of Convair and General Dynamics took place in about September 1956. There was no break in petitioner's employment when the merger occurred. Petitioner is a technician in radio, radar, electronics, and telemetry. At all times material, his job classification was either research and development technician, or assistant foreman in supervisory work.
One of the questions in this case requires consideration of the distance between the respective locations of petitioner's residence and place of work in 1959; but it is also material to consider distances between the location of that place of work and other residential areas, in view of petitioner's contentions. The foregoing will serve to explain the following details about the distances between several places.
In August 1956, and before, petitioner's job was at the Convair plant located in the downtown part of the city of San Diego, near the Bay of San Diego. Beginning on August 16, 1956, and for 5 years thereafter until August 28, 1961, petitioner worked at the Sycamore facility of General Dynamics in Sycamore Canyon, which is in San Diego County north of and not far from the main part of the city of San Diego. Soon after the merger in September 1956 of Convair and General Dynamics, the latter corporation in about 1957 established its main plant in the northern part of San Diego City at 5001 Kearney Mesa Road (also referred to in the record as Kearney Villa Road) in the Kearney Mesa district, and it is known as the Kearney Mesa plant. Also, at some time after the merger, the Convair plant, downtown, was devoted primarily to the construction of airplanes and certain departments were moved to the uptown Kearney Mesa plant, such as the one in which petitioner had been employed before going to Sycamore. Petitioner did not work at the Kearney Mesa plant until February 1963. However, it is necessary to relate the location of the Sycamore facility to some point in San Diego City and since Sycamore facility was and is operated by General Dynamics, it is practical to consider the distance between Sycamore and the Kearney Mesa plant of General Dynamics.
The Kearney Mesa plant is located just east of Highway 395 (Cabrillo Freeway) and nine-tenths of 1 mile south of the intersection of Highway 395 and Clairemont Mesa Boulevard. It is located about 8 miles north of the Convair plant.
The Sycamore facility is reached by driving over Pomerado Road. In 1959, the entrance to Sycamore was on that road. Pomerado Road joins Highway 395, on the south, a short distance north of the intersection of Clairemont Mesa Boulevard and Highway 395, and, accordingly Pomerado Road is but a short distance north of the Kearney Mesa plant. The distance from the Kearney Mesa plant parking lot to the 1959 entrance to Sycamore facility, going north via Highway 395 and Pomerado Road, is 9.1 miles. Sycamore is roughly 17.1 miles from the Convair plant, north via Highway 395 and Pomerado Road; or between 17 and 20 miles, depending upon the approach from the downtown part of San Diego.
During 1956 until sometime in 1957, petitioner lived in Clairemont, a residential district within the city limits of San Diego. At sometime in 1957, he moved to the town of Pacific Beach, a few miles southwest of Clairemont, where he lived until April 1958, when he bought and moved to another residence located 10 miles north of the town of Escondido. He thereafter lived there with his family during 1959 and all times material. Escondido is 36 miles north of the center of San Diego City and 18.4 miles northwest of Sycamore.
While petitioner worked at the Convair plant, he drove in his own car to work each day from his residence in Clairemont, a distance of 12 or 13 miles. Beginning on August 16, 1956, when he went to work at Sycamore, he drove in his own car from Clairemont to Sycamore, a distance of either 11 or 12.3 miles from the center of the Clairemont district, via Clairemont Mesa Boulevard to Highway 395, and then over Pomerado Road to Sycamore. Later, when he moved to Pacific Beach, about 4 miles farther west, he drove to work each day from there to Sycamore, a distance of about 16.3 miles via the same roads. When he moved to the Escondido area, he drove from his home to his work at Sycamore, a distance of 28.4 miles to the entrance of the facility. He drove a few more miles within the area of the Sycamore facility to the particular test site where he worked. Test site 1 is 1.5 miles from the 1959 entrance; test site 2 is 2.1 miles from that entrance.
There is no public transportation to the Sycamore facility and General Dynamics neither provided transportation to the entrance nor paid the employees working there any extra amount to cover the costs of providing their own transportation between work and their homes. All of the employees at Sycamore, at one time as many as 600, drove to work from their respective residences in the general area of Sycamore. The Sycamore facility is not in a town; it is a restricted area on Government-owned property in the hills; all of the employees live in nearby towns.
Throughout 1959 petitioner worked as an assistant foreman in the Astronautics Division at Sycamore. He was employed at Sycamore continuously for 5 years, from August 16, 1956, to August 28, 1961, when he volunteered to work at offsite locations and received the first of such assignments in Omaha, Nebr. His work at Sycamore did not involve any traveling to any other place in the performance of his duties. Sycamore was his regular and only post of duty. His salary in 1959 was $9,385.
In his 1959 return, petitioner deducted $1,260 for the expense of driving between his home and Sycamore, computed as follows: He drove 30 miles, each way, or 60 miles during 234 working days; he used a cost of 9 cents a mile; the total mileage was 14,040 miles; $1,260 is a rounded-off figure for the total mileage multiplied by 9 cents a mile.
Respondent disallowed the deduction because it was not an ordinary and necessary business expense.
Sycamore Facility
In 1955, an area of 2.25 square miles up in the hills on the Camp Elliott Naval Reservation in West Sycamore Canyon, San Diego County, was selected for the Sycamore facility. The location satisfied Convair's requirement that it should be within 30 miles from the Convair plant in San Diego City. It is near sources of water and electric power, on Government-owned land, away from inhabited areas, 6 miles east of Highway 395, and about 5 miles northeast of Miramar. Convair began construction of buildings and test facilities in 1955; they were substantially completed by August 1956.
Sycamore is a facility for making on-the-ground, static, deactivated test firing of Atlas and Centaur missiles; no missiles are launched. Such tests are a middle operation between laboratory work and launching a missile into flight. At all times the work at Sycamore has consisted of preparing missiles for and making static test-firings. The facilities include a two-story administration building with offices, cafeteria, engineering services, medical and fire departments; a missile assembly building; a standard calibration laboratory; a maintenance ship; service towers; blockhouse control centers; ground equipment; fuel storage areas; and other facilities. There are now three test stands, two for testing Atlas and one for testing Centaur missiles. In 1959 there were two Atlas testing sites. Each test stand utilized an open-truss, steel tower 100 feet high; a concrete blockhouse, control center, fuel storage area, and other facilities. The test instrumentation system and deactivated launcher assembly units are similar to those used at Cape Canaveral. Atlas test stand 1 was completed in August 1956, and test stand 2 was completed in 1957. A Centaur test stand and tower were completed in 1960. Atlas test stands 1 and 2 are 2.5 or 3 miles apart. General Dynamics operates a scheduled bus service within the area between the administration and other buildings and the test sites, but it does not provide bus service to Sycamore from any outside location.
Operations began at Sycamore in August 1956 and have been carried on continuously up to the present time. General Dynamics expects to continue to operate Sycamore and has made studies of contemplated testing operations related to the development of advanced space vehicles and weapons systems programs. Most of the work is done under Government contracts. Convair began operations at Sycamore in August 1956 and assigned employees to work there. When Convair merged with General Dynamics in September 1956, most of those working there, including petitioner, became employees of the latter, and the Astronautics Division of General Dynamics took over and still carries on the operations at Sycamore. In August 1956, the first of Series A Atlas missiles was prepared for test-firing. The first Centaur missile was tested in December 1960. Since December 1956, tests have been made of Series A, B, C, D, E, and F Atlas missiles, and of Centaur missiles. Testing of Series F, Atlas, began in March 1961 and continued into 1963. Up to 1961, 147 tests had been completed; up to February 1962, there had been more than 329 countdowns. Prior to 1962, 600 employees had been required to support all operations; early in 1962, there were 400 employees at Sycamore.
Sycamore is not an offsite location because it is less than 30 miles from San Diego City, and none of those employed there are paid any of the extra allowances for working there which are paid employees at offsite locations. Employees at offsite locations are paid, in addition to regular pay, the following extra allowances: $90 per month extra salary; $14 per diem for the first 89 days; moving expenses if they move there; expense of transportation to the location and return, and if it is by automobile, the allowance is 8 cents per mile.
Since Sycamore is not located just outside a town, is in a restricted area, and is without living accommodations; no employees live there; all live in various towns in the general area and get to work in privately owned cars—their own or under car pool arrangements. Pomerado Road, connecting with other roads, reaches several towns and cities which are not far away including San Diego, La Jolla, Linda Vista, Pacific Beach, Clairemont, Lakeside, Santee, La Mesa, El Cajon, and Escondido. Escondido and Lakeside, each, are 18.4 miles from Sycamore. The closest town, Poway, 5.4 miles away, is small and in 1959 not more than five employees are known to have lived there.
Petitioner's Assignment and Living Arrangements
Up to August 16, 1956, petitioner was employed at the Convair plant in downtown San Diego in department 756 as a research and development technician in engineering and telemetry. On August 16, 1956, he was sent to Sycamore on a loan of 90 days, a customary period used by the personnel department in making a new assignment. If the employee remained at the new location beyond 90 days and the loan was not extended for another 90 days, at the end of the first 90 days the assignment became a regular transfer to the new location. On October 29, 1956, before the end of 90 days, petitioner was notified orally that he had been regularly transferred to department 573, Astronautics Division, the only one handling operations at Sycamore, and that he was to work there indefinitely until further notice. The transfer was noted in his personnel file. On October 29, 1956, petitioner's loan assignment to Sycamore ended, and Sycamore became his only place of employment and post of duty. No time limit was placed on his transfer and he was not assigned to any particular project having a short duration. In 1957, his job classification was changed from research technician to assistant foreman in supervisory work in telemetry in the preparation of Atlas missiles for test-firing. This was a promotion with a monthly salary increase of $13. During his 5 years at Sycamore, petitioner's duties were essentially the same; they did not involve traveling to other sites or working at any plant in San Diego; he never returned to the Convair plant to work. The operations at Sycamore, in general, were the preparation of missiles for test-firing and were not planned for just a few projects.
As above stated, petitioner lived with his family in the Clairemont section of San Diego City in 1956, where he owned a two-bedroom house. In 1957, he and his wife were divorced. The house was transferred out of his ownership under the divorce settlement. After the divorce, petitioner lived in Pacific Beach. Up to August 16, 1956, petitioner drove his automobile daily between his home and the San Diego plant, a distance of 12 or 13 miles each way; after August 16, 1956, he drove his automobile daily from Clairemont to Sycamore, 11 or 12.3 miles each way, and from Pacific Beach to Sycamore, about 16.3 miles each way.
Petitioner remarried on February 26, 1958, and in April 1958 he purchased country property, a two-bedroom house and 9 acres of unimproved land, 10 miles north of the town of Escondido. He lived there with his family in 1959 and at all times material. He drove to work daily between this home and the entrance to Sycamore, 28.4 miles. He still lives in the Escondido area but at another address. He selected the first property near Escondido because he preferred living in the country and the seller was willing to sell it without a down payment, which was financially advantageous. He did not carry on farming operations there, although at first he believed he might do so. He did not attempt to find a place to live in Poway.
Petitioner was not required to carry work tools in his car; there is no evidence that he did so while working at Sycamore.
Petitioner worked alternately at Atlas test sites 1 and 2 in 1959. He could use, if he wished, the General Dynamics bus within Sycamore to go from one test site to another. He drove to the site where he was working.
In 1961, petitioner volunteered to take an offsite assignment away from Sycamore. He received several during the 18 months beginning August 29, 1961, and ending in February 1963. While working at offsite locations, General Dynamics paid him the usual extra offsite compensation and traveling expense in addition to his regular salary. He had five offsite assignments: On August 29, 1961, he went from Sycamore to a base in Omaha, Nebr., for 6 months; he went from Omaha to Salina, Kans., for 2 1/2 months; he then returned to the Kearney Mesa plant in San Diego for a 2-week vacation and reassignment; he then went to Spokane, Wash., for 3 months; then from Spokane to Cheyenne, Wyo., for 2 1/2 months; he returned for 3 weeks to the Kearney Mesa plant for a reassignment; he then went back to Spokane for 8 weeks. He returned to and was assigned to the Kearney Mesa plant in February 1963, where he has worked continuously ever since. He asked to be relieved of offsite assignments in February 1963, because he did not want to do any more traveling, and his post of duty then became the Kearney Mesa plant. His job classification became research technician, a lower classification than assistant foreman.
ULTIMATE FINDINGS
On October 29, 1956, Sycamore facility became petitioner's only post of duty and regular place of employment. He was regularly transferred there for an indefinite period which lasted 5 years, until August 28, 1961, when he volunteered to take offsite assignments. Sycamore was not a temporary, secondary, or minor place of petitioner's work. Petitioner was not assigned on October 29, 1956, to work at Sycamore for only a few months or 1 year; he was transferred to Sycamore for an indefinite period of substantially long duration and there was a reasonable probability, known to him at that time, that he would be employed at Sycamore for a long period.
Sycamore was not and is not a temporary division and work site of General Dynamics. It was established in 1955 as a site where operations would be carried on for a substantially long period and would not be terminated within any foreseeable short period.
Sycamore is not in a remote location; it is accessible and fairly close to San Diego City and other residential areas. The general area of Sycamore includes the environs of San Diego City, Escondido, and several other towns. Petitioner's residence in 1959 near Escondido was within the general area of Sycamore.
Petitioner's reasons in 1958 for selecting the Escondido area and property 10 miles north of Escondido as the location of his residence were purely personal involving his own preferences, choice, and convenience.
Petitioner's expenses in 1959 of driving his automobile daily between his residence and Sycamore are nondeductible, personal expense, and are not business expense, nor expense incurred in performing services as a employee, nor expense of traveling ‘while away from home in the pursuit of a trade or business' within section 162(a)(2).
OPINION
The issue is whether petitioner's expense of driving daily to work from his residence and return is ordinary and necessary business expense within section 162(a),
or nondeductible personal expense under section 262. Respondent disallowed a deduction of $1,260. Petitioner had the burden of proving that the expense is deductible.
SEC. 162. 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—(2) Traveling expenses (including the entire amount expended for meals and lodging) while away from home in the pursuit of a trade or business;
Petitioner in effect essentially relies on Harry F. Schurer, 3 T.C. 544, and part of Rev. Rul. 54-497, 1954-2 C.B. 75, 81. In this ruling, dealing with railroad employees, there are discussed at length the meanings of expenses paid and incurred while in travel status ‘away from home,’ ‘principal or regular post of duty,’ ‘temporary or minor post of duty’ away from the principal post of duty, ‘strictly temporary,‘ and related matters, and at page 81 the following statement is made:
An employee's expenses for transportation within the vicinity of the city or other comparable area which constitutes his minor or temporary post of duty, such as for ‘commuting’ between his minor or temporary terminal and the place or places where he obtains his meals and lodging in that area, are held to be nondeductible personal expenses. However, when an employee's minor or temporary terminal is located in a remote area and he must travel 10 or 15 miles, for example, to the nearest town or other location where he can obtain necessary living accommodations, his transportation expenses so incurred are not regarded as being in the nature of commuting expenses, but may be deducted in computing adjusted gross income. (Emphasis added.)
Petitioner relies also on examples 9, 10, and 11 in Treasury Department Publication 300 (1956) dealing with explanations of the circumstances under which travel and transportation expenses either are or are not deductible. This publication is reprinted in 56-4 P.-H. Fed. Taxes par. 76,425, and 63-2 C.C.H.Fed.Tax Rep.par. 1350.1433.
The contentions of petitioner, evidently based on his understanding of the above (with respect to the meaning of which for tax purposes he has not had the aid of counsel), are as follows: In 1959, Sycamore was a minor or temporary location of his job, and Sycamore was located in a ‘remote area’; therefore, he claims that his expenses of driving daily to Sycamore from his residence, and back, are deductible under section 162(a) as expenses incurred while ‘away from home.’
The only case cited by petitioner is Crowther v. Commissioner, 269 F.2d 292, reversing 28 T.C. 1293, although because of his reliance on certain tax service statements he relies in effect on the Schurer case.
The question presented is whether in the taxable year, petitioner's employment at Sycamore was ‘temporary,‘ so as to bring the disputed expenses within the exception to the general rule stated in Commissioner v. Flowers, 326 U.S. 465, and so as to bring the expenses within the rule of Schurer.
At the outset, it must be emphasized that except for the use of the adjective ‘remote’ in the example given in Rev. Rul. 54-497, supra, ‘remoteness' of the location of a taxpayer's job ordinarily is not a test of whether transportation or travel expense incurred in going to and from a work site comes within the statutory category of traveling expenses ‘while away from home.’ In Wright v. Hartsell, 305 F.2d 221, affirming 182 F.Supp. 725 (not cited by petitioner), the court gave consideration to a situation similar to the example given in Rev. Rul. 54-497, quoted above. Hartsell, which is distinguishable, is considered hereinafter.
Upon consideration of the entire record and all of petitioner's argument, it is found and concluded that in 1959 petitioner's assignment to Sycamore was not temporary; the Schurer case and the part of Rev. Rul. 54-497 quoted above, the ruling relied upon, do not apply here; the expenses in dispute were in the nature of the expense of commuting to work; the general rule applies; the expenses do not come within any exception to the general rule, discussed hereinafter; the expenses are not deductible. Respondent's determination is sustained. The question is controlled by Leo M. Verner, 39 T.C. 749, 756.
Consideration first is given to petitioner's contention that his assignment to Sycamore was temporary, that it was a temporary or minor place of employment. The concept of being temporarily employed at a place embraces the correlative situation of having another place where the taxpayer is regularly or customarily employed, which continues to be the taxpayer's place of regular employment during the period in which he is temporarily employed at the second place; i.e., the taxpayer is away from the place or area or town of his regular employment while he is temporarily employed at some other town or place. See Coburn v. Commissioner, 138 F.2d 763; Rev. Rul. 60-189, 1960-1 C.B. 60, 62. Thus, in Harry F. Schurer, supra, the taxpayer, a journeyman plumber, had always carried on his trade as a plumber in Pittsburgh and was a member of a local union in that city, and he had his residence there. Due to the heavy demand for plumbers to assist in war construction, he was requested in 1941 by his union to go to work for short periods at construction projects in three different towns. He worked at Indiantown Gap, Pa., for 4 weeks; at Aberdeen, Md., for 9 weeks; and at Morgantown, W. Va., for 33 weeks, all in 1941. After each job was completed, he returned to Pittsburgh. This Court found that Schurer's employment at each of the three towns during 1941 was temporary employment ‘away from home’ in pursuit of his trade, and relying upon Coburn v. Commissioner, supra, concluded that Schurer's expenses for meals and lodging while at each town and his transportation expenses from Pittsburgh to each town, and return, were deductible as traveling expenses ‘while away from home in the pursuit of a trade.’ Sec. 23(a)(1), I.R.C. 1939.
Petitioner has not established that he had a principal and regular place of employment other than at Sycamore during the period October 29, 1956, to August 28, 1961. From August 16 to October 29, 1956, petitioner was assigned from the Convair plant in San Diego City to Sycamore on a 90-day loan. Before expiration of the 90-day period, he was regularly transferred to department 573 at Sycamore and advised that he was to work there until further notice. He understood at that time, on October 29, 1956, that he would be expected to work at Sycamore for longer than a short time the end of which was then reasonably foreseeable, and in this case he testified that he understood he would be expected to work there for a substantially long period. Convair merged with General Dynamics in about September 1956 (according to the record in this case) and thereafter the work at the Convair plant was exclusively the construction of airplanes. There is nothing in the record to show that as of October 29, 1956, or any subsequent time, petitioner expected to or could have returned to the Convair plant, and he never again worked there. The only other main plant which he could claim as a place of regular employment was the new General Dynamics plant in the Kearney Mesa area of San Diego City, but he never was assigned to any work there until after August 28, 1961. In fact, his first new assignment was in Omaha, Nebr., an offsite location, to which he apparently went on August 29, 1961. We went to Omaha directly from Sycamore, not from the Kearney Mesa plant. He admits that he was not assigned to any regular work at the Kearney Mesa plant of General Dynamics until February 1963, where he now works. (Incidentally, he still lives outside the town of Escondido in a different house than he occupied in 1959 and goes to work at the Kearney Mesa plant from there, a distance of 30 miles, or more.)
It must be concluded that in the taxable year 1959 petitioner did not have any principal place of employment other than Sycamore with respect to which Sycamore could or might be a secondary or minor place of employment.
In 1959, Sycamore was not a place of temporary employment of petitioner, and, also, it was not a temporary ‘plant’ or division of General Dynamics, contrary to petitioner's argument, for the following reasons. The Sycamore facility was planned as one which would be operated in connection with the Atlas ICBM program for a substantial length of time. Construction of the facilities consumed about 1 year and they are in themselves substantial. Static testing of Atlas missiles of several series began in 1956 and continued into 1963, at least. The record indicates that Sycamore is not a temporary facility and petitioner has not established the contrary. Petitioner was assigned at Sycamore to do supervisory work in preparing Atlas missiles for testing. When he went to Sycamore in August 1956, the assignment was for a 90-day loan period and, therefore, it was at first temporary. But on October 29, 1956, he was notified that he was being transferred from department 756 at the Convair plant to department 573 at Sycamore and that he was to work there until further notice, no date being indicated as a termination of the assignment. In 1957, his job classification was advanced to assistant foreman in supervisory work. By the end of 1958, he had worked at Sycamore for over 2 years. There is no evidence that by the end of 1958, petitioner had any understanding that his work there would be terminated in the near future. In fact, he worked at Sycamore for 5 years and when he left in August 1961, it was not because his assignment to Sycamore had been terminated by his employer. Rather, it was because he volunteered to take his first assignment to an offsite location where General Dynamics was conducting a program or project. By 1959, petitioner's employment at Sycamore had become ‘indefinite,‘ one which was not temporary, and it had become evident to him that it was very likely and probable that his employment there would not be relatively short but would be for a substantially long period. In Harvey v. Commissioner, 283 F.2d 491, reversing 32 T.C. 1368 on other grounds, a test suggested is whether there was a reasonable probability known to an employee (‘known to him’) at the time he was transferred to a new post of duty that he would be employed there for a long period of time. In this case, upon the entire record, under the above test, we think that the only conclusion which properly can be made is that as of October 29, 1956, there was a reasonable probability known to petitioner that he would be employed at Sycamore for a long period of time. That was certainly the situation by the end of 1958. In Wright v. Hartsell, supra, the Court of Appeals for the Ninth Circuit stated that proper test is that ‘if the prospects are that his work will continue for an ‘indefinite’ or ‘indeterminate’ or ‘substantially long’ period, then the deduction (for travel expenses) is disallowed.' See also Claunch v. Commissioner, 264 F.2d 309, affirming 29 T.C. 1047; Cockrell v. Commissioner, 321 F.2d 504, affirming 38 T.C. 470; Floyd Garlock, 34 T.C. 611, 615. Moreover, ‘temporary’ employment may ripen ‘into a substantial, indefinite, or indeterminate, rather than a temporary duration,‘ Floyd Garlock, supra at 615; Arnold P. Bark 6 T.C. 851, 855; Leo M. Verner, supra at 754. In Beatrice H. Albert, 13 T.C. 129, 131, this Court observed that employment at a place may not be ‘permanent’ but, on the other hand, if it is of ‘indefinite’
duration rather than temporary, a deduction for commuting expenses, or expenses of going to work from one's place of abode, must be denied.
The rule of Harry F. Schurer, 3 T.C. 544, followed in E. G. Leach, 12 T.C. 20, to the effect that ‘temporary’ employment comes within the concept of traveling ‘away from home’ has been applied in comparatively few cases by this Court. In a substantial number of subsequent cases where the facts did not show that employment at a place was temporary, it was concluded that the employment was not temporary. In order to distinguish the Schurer case, the terms ‘indefinite’ and ‘indeterminate’ were used to describe the duration of the particular taxpayer's employment at a place. The origin of the expression ‘indefinite duration of employment’ was simply one of convenience to distinguish the Schurer case; that expression means ‘not temporary.’ See Peurifoy v. Commissioner, 358 U.S. 59; and Rev. Rul. 60-189, 1960-1 C.B. 60, 62.
In the taxable year 1959 petitioner, at Sycamore, was not working at a place of temporary employment. His transportation expenses between his residence and Sycamore do not come within the Schurer rule or the exceptions to the general rule on which he relies set forth in Rev. Rul. 54-497, 1954-2 C.B. 75, 81, and Treasury Department Publication 300 (1956), and are not deductible.
Petitioner has not established that he could not have mitigated, or reduced, his going-to-work transportation expenses. He admits that many employees at Sycamore did so by participating in car pools with others. We are not satisfied that he could not have participated with others in car pools a good deal of the time during 1959. With respect to the location of his residence in 1959, 10 miles north of Escondido, that location was a matter of personal choice, and if that location made participation in car pools with others, as a means of reducing transportation expense, difficult, the difficulty resulted from petitioner's personal reasons for selecting a distantly located and somewhat inaccessible location for a residence. Furthermore, it was not petitioner's job at Sycamore which determined that he should move his residence to the Escondido area. He could have continued to live in Clairemont, or another section of San Diego City, and thereby reduced his mileage in driving to Sycamore to 12, 14, or 18 miles, each way.
Upon consideration of the whole record and all of the circumstances, it is our view that there is little merit in petitioner's claim that the transportation expenses at issue are deductible. Petitioner's situation was similar to that of an employee of a corporation who is transferred from one office or plant to a branch office or subsidiary plant within the same general area. Sycamore is located in San Diego County in the same general area as the location of the main plant of General Dynamics at Kearney Mesa. When petitioner was transferred to Sycamore in 1956, the transfer did not necessitate moving his family residence from where it was in 1956. In fact, the mileage from Clairemont to Sycamore, 12 or 13 miles, was much less than the mileage from his 1959 residence near Escondido to Sycamore, 28.4 miles. ‘The job, not the taxpayer's pattern of living,‘ is the crucial matter in considering whether the transportation costs of going to work are deductible as business expenses under section 162(a). Carragan v. Commissioner, 197 F.2d 246, 249; O'Toole v. Commissioner, 243 F.2d 302, 303; Cockrell v. Commissioner, supra. In the instant case, it was petitioner's pattern of living, not his job at Sycamore, which caused the amount of mileage involved in the transportation expense at issue. That expense was similar to the expense of commuting to work, which always has been treated as nondeductible personal expense. Beatrice H. Albert, supra; Commissioner v. Flowers, supra; Commissioner v. Peurifoy, 358 U.S. 59. The general rule that the expenses of transportation between the taxpayer's residence and place of work are personal and not deductible as a business or away-from-home traveling expense has been held to apply regardless of the distance between those two locations, the lack of public transportation, the use of the taxpayer's automobile, and in spite of equitable considerations. The cases cited in the margin
illustrate the variety of circumstances under which deductions for such expenses have been denied. In United States v. Woodall, 255 F.2d 370, 373, in denying such deduction the court noted that ‘What should be allowed as an expense deduction is a matter of policy for Congress, not the Courts.’
Barnhill v. Commissioner, 148 F.2d 913; Carragan v. Commissioner, 197 F.2d 246, 249; Donnelly v. Commissioner, 262 F.2d 411, affirming 28 T.C. 1278; Green v. Commissioner, 298 F.2d 890, affirming 35 T.C. 764; Leo M. Verner, 39 T.c. 749, 756; Clarence J. Sapp, 36 T.C. 852, affirmed per curiam 309 F.2d 143; Lenke Marot, 36 T.C. 238; William L. Heuer, Jr., 32 T.C. 947, 951-953, affirmed per curiam 238 F.2d 865; Darrell Spear Courtney, 32 T.C. 334, 344; Chester C. Hand, Sr., 16 T.C. 1410; Williard I. Thompson, 15 T.C. 609, 612-613, reversed on another issue 193 F.2d 586; Beatrice H. Albert, 13 T.C. 129; John C. Bruton, 9 T.C. 882; Charles H. Sachs, 6 B.T.A. 68; Leo C. Cockrell, 38 T.C. 470, affd. 321 F.2d 504; Kalist v. Commissioner, 321 F.2d 508, affirming a Memorandum Opinion of this Court; Frank N. Smith, 21 T.C. 991; Joseph M. Winn, 32 T.C. 220; Benson v. Godwin, 164 F.Supp. 70; O'Toole v. Commissioner, 243 F.2d 302; United States v. Woodall, 255 F.2d 370; Commissioner v. Janss, 260 F.2d 99.
The taxpayer who takes business trips has the burden of the double expense of maintaining his family residence or regular place of abode and of paying additional sums for living accommodations, meals, and traveling expenses at the place to which his business trip takes him. In the case of an employee, his employer's business necessitates the business trip, and ordinarily a business trip is of relatively short duration. Section 162(a)(2) allows a ‘special deduction to mitigate the burden which this taxpayer carries.’ Harvey v. Commissioner, supra; James v. United States, 176 F.Supp. 270, 272. The petitioner during the taxable year was not under the burden of such double expenses.
In Commissioner v. Flowers, supra, the United States Supreme Court declared that three conditions must be satisfied before a deduction can be allowed under the applicable statute; that ‘Failure to satisfy any one of the three conditions destroys the travel expense deduction’; that it is a question of fact in most instances whether a particular expenditure fulfills the three conditions; and that it is the exigencies of the business involved and the interests of the employer rather than the personal conveniences and necessities of the employee which must motivate the traveling expense. Petitioner's expenses do not satisfy the second and third conditions, namely, that the expense must be incurred ‘while away from home,‘ and that the expense must be directly related to and necessary to the pursuit of the employer's business.
Consideration has been given to the cases of Crowther v. Commissioner, supra; Wright v. Hartsell, supra; and Mathews v. Commissioner, 310 F.2d 111, reversing per curiam 36 T.C. 482. These cases are on their facts distinguishable from the instant case.
This Court has stated the reasons making Hartsell distinguishable from the case of Verner, and since the facts here closely resemble those of Verner, the same distinction is made here. Leo M. Verner, supra, at 755-756. Hartsell, a construction worker, has his regular place of abode in Pocatello, Idaho (which also was the area of his general employment and location of his union), 70 miles (140 miles round trip) from the AEC site extending over 1,500 square miles in a desert in southeastern Idaho. The closest town with housing accommodations is Arco, 46 miles from that site. He drove daily between Pocatello and that site; he received for such trips allowances from his several employers. It was held that part of the expense was deductible because directly related to the exigencies of business rather than the taxpayer's personal necessity and convenience; and that other expense incurred in the performance of a temporary job, one of several jobs held in the taxable period, was deductible. In the instant case, petitioner's job was not temporary, towns providing housing are located 12 to 18 miles from Sycamore; the respective locations of Sycamore and the AEC site in the Hartsell case are not comparable; Sycamore is not in a ‘remote’ area. The distance which petitioner drove to work could have been reduced from 30 miles to 12 or 14 miles if he had wished to mitigate his transportation expense by selecting a residence in a town closer to Sycamore, which he could have done. His argument that the closest town, Poway, did not have available housing is not in point. The point which is significant is that the location of Sycamore is such that all employees working there have a choice of several towns with available housing which are less than 20 miles distant and petitioner was not obliged to live 30 miles away. We regard a 30-mile trip as commuting distance the expense of which is personal under the general rule. Leo M. Verner, supra.
The cases of Crowther and Mathews involved workers employed in the logging industry. The Court of Appeals for the Ninth Circuit concluded in both cases that the exception to the general rule properly should be made because each taxpayer worked at several ‘temporary’ jobs at different log sites for different employers. Deductions were allowed for the automobile expense of driving to the various log sites, which allowances come under the rule of Harry F. Schurer, supra. The court concluded that the facts in Mathews were indistinguishable from those in Crowther.
In Mathews this Court was of the opinion that the taxpayer ‘was permanently employed in a generally defined area’ and that to treat each new work location as a ‘temporary’ job amounted to an unjustifiable fragmentization of what we regarded as ‘continuous employment extending over an indefinite period.’ Edward Mathews, 36 T.C. 483, 486. In effect, we took the same view in Crowther. The Court of Appeals disagreed with this view in both cases. In Crowther, Hartsell, and Mathews, the Court of Appeals took the view that the conditions and circumstances under which each taxpayer obtained particular jobs were such that each job should be considered separately, even though all of the jobs of each taxpayer were located in a particular geographical area, and that so regarded, each taxpayer worked at several ‘temporary’ jobs during a tax period, thus, in effect, bringing the automobile expense of daily trips to a particular job site within the rule of Harry F. Schurer, supra, the exception to the general rule that expenses of getting to work are personal.
This case does not involve a taxpayer who worked for different employers at different work sites during the taxable period. We do not have the problem here of determining whether a taxpayer's general employment within a defined area should or should not be fragmentized into a series of ‘temporary’ jobs. The basic distinction here is that petitioner worked continuously before, during, and after the taxable year for one employer and he had just one job, which was not temporary. The fact that during 1959 he sometimes worked at test site 1 rather than test site 2 is not material; his work was the same at both sites; the Sycamore area is a relatively small one of 2.25 square miles; and the facts here do not justify breaking up petitioner's employment at Sycamore into fragments. Petitioner, unlike the taxpayers in the cases cited above, was not employed temporarily at various work locations by one employer or by different employers, and his employment in the taxable year was not comparable to their particular situations. The cases of Hartsell, Crowther, and Mathews are distinguishable and inapplicable; the rule of Schurer does not apply.
It is held that petitioner's automobile expenses during 1959 are not deductible under section 162(a).
Decision will be entered for the respondent.