Toner v. Commissioner

Sterrett, J.,

concurring: While I agree with the result reached by the majority that petitioner’s educational expenses are not deductible, I premise my conclusion on a different ground.

The majority, in making reference to section 1.162-5(b)(2), Income Tax Regs., seems to be saying that that subparagraph requires disallowance of educational expenses incurred in order to meet the minimum educational requirements necessary for qualification in another trade or business, with the implication that such trade or business is a new trade or business. If that subparagraph actually so provided, subparagraph (3) of that regulation would be redundant. In my view, subparagraph (2) in fact refers to any present trade or business of the taxpayer other than his employment.

It is section 1.162-5(b)(3), Income Tax Regs., that disqualifies the petitioner herein from deducting her educational expenses.1 That subparagraph provides for the nondeductibility of expenditures made with respect to “a program of study being pursued by him which will lead to qualifying him in a new trade or business.” Herein petitioner’s program of study led to her qualification for certification by the State as a teacher. Once certified, petitioner could teach in public schools, Catholic high schools, or in private nonreligious schools. I find this situation analogous to the line of cases in which we have found a significant qualitative difference between accountants and certified public accountants. E.g., Glenn v. Commissioner, 62 T.C. 270, 275 (1974). As in that line of cases I find that the difference in petitioner’s potential scope of practice as a certified teacher is significant when compared to that of a noncertified teacher.2

Apparently this subsection was not considered by the parties. See n. 2 of the majority opinion. However, we may uphold a deficiency based on legal grounds other than those relied upon by respondent. Wilkes-Barre Carriage Co. v. Commissioner, 39 T.C. 839, 845 (1963), affd. per curiam 332 F.2d 421 (2d Cir. 1964), and cases cited thereat.

Because we find a significant distinction between a certified and a noncertified teacher, the language of sec. 1.162-5(bX3)(i), Income Tax Regs., stating that all teaching duties involve the same general type of work is inapplicable. Cf. Diaz v. Commissioner, 70 T.C. 1067, 1075 (1978).