1957 U.S. Tax Ct. LEXIS 68">*68 Decision will be entered under Rule 50.
The petitioner, a parimutuel calculator at racetracks, is a native of Louisville, Kentucky, and maintained a residence there. He worked at Churchill Downs Race Track in Louisville for 38 days each year, 19 days in the spring and 19 days in the fall, which was the extent of the racing season there. While working at Churchill Downs he would arrange employment for the summer and winter seasons with officials of other racetracks who usually attended the Churchill Downs meet. He was employed at three or four different racetracks away from Louisville for 293 days during each of the years 1952 and 1953. Petitioner deducted $ 3,032.92 from his gross income for each year as "traveling expenses while away from home [Louisville] in pursuit of trade or business." Respondent disallowed the entire amounts determining that the claimed expenses were not incurred while "away from home" and also for lack of substantiation. Held, the petitioner's home was Louisville, Kentucky, and that traveling expenses (including meals and lodging), the amounts of which are herein determined, are deductible under section 23 (a) (1) (A), I. R. C. 1939. James E. Peurifoy, 27 T.C. 149 (1956),1957 U.S. Tax Ct. LEXIS 68">*69 followed.
29 T.C. 16">*16 The respondent determined deficiencies in petitioner's income tax for the calendar years 1952 and 1953 in the amounts of $ 729.73 and $ 747.98, respectively. The deficiencies are due to the respondent's disallowance of traveling expenses in the amount of $ 3,032.92 for each year. 1 The adjustment for the year 1952 is explained in the deficiency notice, as follows:
(a) Deductions for travel expense, claimed on your return for 1952 in the amount of $ 3,032.92, have been disallowed because they were not incurred while "away from home" and also for lack of satisfactory substantiation. Such disallowance is made under the provisions of section 23 (a) (1) of the1957 U.S. Tax Ct. LEXIS 68">*70 Internal Revenue Code of 1939.
The explanation of the adjustment for 1953 is similar.
The petitioner, by appropriate assignments of error, has placed the entire deficiencies in issue.
The questions involved are (1) whether the petitioner's "home" for purposes of section 23 (a) (1) (A), Internal Revenue Code of 1939, 2 was Louisville, Kentucky, as claimed by petitioner, or West Palm Beach, Florida, as claimed by the Commissioner, and (2) the amount of travel expenses incurred.
29 T.C. 16">*17 FINDINGS OF FACT.
Some of the facts have been stipulated; they are so found, and are incorporated herein by1957 U.S. Tax Ct. LEXIS 68">*71 this reference.
The petitioner, Alois Joseph Weidekamp, is an individual residing at 1891 Princeton Drive, Louisville, Kentucky. His returns for the years 1952 and 1953 were filed with the district director of internal revenue at Louisville.
Petitioner was born and reared in Louisville and attended grade school, high school, and college there. The petitioner's mother owned a home (1891 Princeton Drive) in Louisville. The petitioner, during the years involved, expended money for maintenance of, and for real property taxes on, this home and for the support of his mother. He had done this since his father's death in 1939. He regards that home as his residence and uses that address as his home address. Petitioner filed Kentucky State resident income tax returns for the calendar years 1952 and 1953. Petitioner filed New York State nonresident income tax returns for the calendar years 1952 and 1953. Petitioner has voted in Louisville since he became of age in 1933. Petitioner was a resident of Louisville, Kentucky.
From the time that petitioner was young he worked at Churchill Downs Race Track in Louisville. He has worked as a calculator in the parimutuel department for a number1957 U.S. Tax Ct. LEXIS 68">*72 of years. This is a specialized occupation. The racing season at Churchill Downs consists of a 19-day meet in the spring and a 19-day meet in the fall. Petitioner would work at each of these meets and would at that time arrange for summer and winter employment with officials of other tracks throughout the country who would usually be in attendance.
The petitioner's occupation during the years here involved was that of a calculator in the parimutuel departments of racing establishments located in various parts of the United States. The names and locations of the various racing establishments at which the petitioner was employed during the years in issue, the amounts paid by each, the percentage of his total income paid by each, and the days worked at each are as follows:
| Year 1952 | ||||
| Name | Place | Amount | Per cent | Approximate |
| days 1 | ||||
| West Flagler Kennel Club | Miami, Fla. | $ 200 | 2.4 | 10 |
| Palm Beach Kennel Club | West Palm Beach, Fla. | 2,205 | 26.3 | 111 |
| Churchill Downs, Inc. | Louisville, Ky. | 638 | 7.6 | 38 |
| Buffalo Trotting Assn., Inc. | Hamburg, N. Y. | 2,448 | 29.3 | 78 |
| Genesee-Monroe Racing Assn. | Batavia, N. Y. | 2,886 | 34.4 | 94 |
| Total | 8,377 | 100.0 | 331 |
| Year 1953 | ||||
| Name | Place | Amount | Per cent | Approximate |
| days 1 | ||||
| Palm Beach Kennel Club | West Palm Beach, Fla. | $ 2,377 | 27.4 | 121 |
| Churchill Downs, Inc. | Louisville, Ky. | 650 | 7.5 | 38 |
| Buffalo Trotting Assn., Inc. | Hamburg, N. Y. | 2,520 | 29.1 | 78 |
| Genesee-Monroe Racing Assn. | Batavia, N. Y. | 3,120 | 36.0 | 94 |
| Total | 8,667 | 100.0 | 331 |
The various tracks at which petitioner was employed during the years 1952 and 1953 were not associated with one another, but each was independent of the other. The petitioner would contract with the parimutuel managers of each separate track for employment for the duration of the racing season at each track at a fixed daily rate.
During the years in question petitioner returned to, and lived in, Louisville, Kentucky, when his employment ended at the tracks outside of Louisville. The petitioner claimed no deduction for expenses while employed or living at Louisville during the taxable years involved.
In each of his 1952 and 1953 returns the petitioner deducted as "traveling expenses away1957 U.S. Tax Ct. LEXIS 68">*74 from home in pursuit of trade or business," the amount of $ 3,032.92. That amount represents the petitioner's estimate of his expenses away from Louisville, computed as follows:
| Meals and lodging | ||
| 293 days (121 days Miami and West Palm Beach, 78 days Hamburg, | ||
| and 94 days Batavia) at $ 9 per day | $ 2,637.00 | |
| Transportation | ||
| Louisville, Ky., to Miami Beach, Fla., and return (2,300 | ||
| miles X $ 0.07) | $ 161.00 | |
| Louisville, Ky., to Hamburg, N. Y., and return (1,668 miles | ||
| X $ 0.07) | 116.76 | |
| Louisville, Ky., to Batavia, N. Y., and return (1,688 miles | ||
| X $ 0.07) | 118.16 | 395.92 |
| 3,032.92 |
Petitioner traveled to and from Louisville and the other places of employment by automobile. Petitioner used the average of 7 cents per mile for automobile transportation upon the advice of Internal Revenue Service personnel. Petitioner claimed no other travel expense or automobile expense. In 1952 and 1953, petitioner did not return to Louisville, Kentucky, between his engagements at Hamburg, New York, and Batavia, New York. At the hearing of this proceeding the petitioner conceded that he erred in both taxable years in charging mileage from Louisville, Kentucky, to Batavia, 1957 U.S. Tax Ct. LEXIS 68">*75 New York. He concedes that in going to Batavia he traveled only from Hamburg, New 29 T.C. 16">*19 York, a distance of about 60 miles, and not from Louisville, as claimed on his returns.
Petitioner dined in restaurants and stayed in a private home, motel, or hotel while away from Louisville. Petitioner estimated his meals and lodging while away at $ 9 per day, including $ 4.50 to $ 5 per day for meals. Lodging in Hamburg and Batavia was about $ 15 to $ 20 per week, while it was more expensive in Florida, especially during the winter tourist season.
Petitioner's home was Louisville, Kentucky. Petitioner actually expended during each year involved at least 7 cents per mile for automobile travel or the total amount of $ 282.66, computed as follows:
| Miles | ||
| Louisville, Ky., to Hamburg, N. Y. | 834 | |
| Hamburg, N. Y., to Batavia, N. Y. | 60 | |
| Batavia, N. Y., to Louisville, Ky. | 844 | |
| Louisville, Ky., to Miami Beach, Fla., and return | 2,300 | |
| 4,038 | ||
| $ 0.07 | per mile | |
| 282.66 |
Petitioner actually expended $ 8 per day for meals and lodging, or $ 2,344 (293 daysX$ 8 per day) in each year. While away from Louisville petitioner expended $ 2,626.66 ($ 282.66+$ 2,344) during each year involved 1957 U.S. Tax Ct. LEXIS 68">*76 on traveling expenses while away from home in pursuit of trade or business.
OPINION.
The petitioner, a parimutuel calculator at racetracks, is a native of Louisville, Kentucky, and maintained a residence there. He worked at Churchill Downs Race Track in Louisville for 38 days each year, 19 days in the spring and 19 days in the fall, which was the extent of the racing season there. While working at Churchill Downs he would arrange employment for the summer and winter seasons with officials of other racetracks who usually attended the Churchill Downs meet. He was employed at three or four different racetracks away from Louisville for 293 days during each of the years 1952 and 1953. Petitioner deducted $ 3,032.92 from his gross income for each year as "traveling expenses while away from home [Louisville] in pursuit of trade or business." 3 These amounts were computed by taking travel (between Louisville and other places of 29 T.C. 16">*20 employment, viz, Hamburg, New York, Batavia, New York, and West Palm Beach, Florida) at 7 cents per mile and meals and lodging at $ 9 per day (for the 293 days away from Louisville).
1957 U.S. Tax Ct. LEXIS 68">*77 The respondent disallowed the entire amount in each year, determining that the claimed expenses were not incurred while "away from home," and, also, for lack of substantiation. Respondent, in his opening statement at the hearing, took the position that the petitioner's home for the purpose of section 23 (a) (1) (A) was wherever he happened to be employed, relying on Wilson John Fisher, 423 T.C. 218 (1954), affd. (C. A. 7, 1956) 230 F.2d 79. On brief, the respondent has modified his position. He agrees that petitioner had a home within the meaning of section 23 (a) (1) (A), but contends that petitioner's home was West Palm Beach, Florida, the place where he was employed the greatest number of days during each of the years involved, rather than Louisville, Kentucky. Respondent agrees that, insofar as substantiated, the cost of travel from his "home" to his other places of employment and the cost of meals and lodging while there are deductible.
1957 U.S. Tax Ct. LEXIS 68">*78 Thus, the question here, aside from the substantiation question which will be discussed later, is whether the petitioner's home was in Louisville, where he maintained his residence and where he spent about 72 days, including 38 days working, or was it in West Palm Beach, where he was employed for about 4 months in each year.
In James E. Peurifoy, 27 T.C. 149 (1956), the taxpayers, construction workers, maintained a residence at a particular place, belonged to a local union at or near their residence, and obtained employment through that union. They worked at various job sites both at or near their residences, and at distant points. There was no particular place where they principally had employment. They returned to their residences at the completion of a job. The three taxpayers were employed at a distant job site for 20 1/2 months, 12 1/2 months, and 8 1/2 months, respectively, portions of which fell within the taxable year. The question involved was whether the cost of 29 T.C. 16">*21 transportation between the residences and the job sites and the cost of meals and lodging while at the job site constituted traveling expenses incurred while away from1957 U.S. Tax Ct. LEXIS 68">*79 home in pursuit of trade or business under section 23 (a) (1) (A). We noted that the situation was not one where the taxpayer, for personal reasons, maintains his residence at a place other than that of his actual employment. We held that employment at the distant job site was no different from the other jobs which formed the general pattern of the taxpayers' employment and that it was temporary, rather than indefinite, in duration. Being temporary, it would not be reasonable to expect the taxpayers to shift their residences to the place of employment or to regard the distant post as their "home" for tax purposes. We, therefore, concluded that the expenses in question were properly deductible as traveling expenses.
A situation comparable to that involved in Peurifoy, supra, is present here. Since the racetrack at his residence only operated for a short time each year petitioner sought employment at other tracks. He was not principally employed at any one place. Each job was temporary. The only distinction is the fact that petitioner knew in advance how long he was to be employed at each post, while in Peurifoy the taxpayers did not usually1957 U.S. Tax Ct. LEXIS 68">*80 know in advance the length of time they would be employed at any job. We do not regard that distinction as material. We think that here, as in Peurifoy, the petitioner could not reasonably be expected to move his residence from Louisville to West Palm Beach, Florida, because of his employment there (West Palm Beach) for about 4 months (120 days in 1952 and 110 days in 1953) during each of the 2 years involved. Accordingly, we think that petitioner's traveling expenses away from Louisville are deductible under section 23 (a) (1) (A).
The next question is the amount of traveling expenses incurred away from Louisville. Petitioner did not submit in evidence detailed records of his expenditures and it appears that he did not keep such records. Petitioner, having traveled to and from his other places of employment by automobile, estimated his travel expenses at 7 cents per mile. We are satisfied from the record that that amount is reasonable and that petitioner expended at least that amount for automobile travel.
In regard to the expense for meals and lodging we do not think the record substantiates the petitioner's estimate of $ 9 per day. Petitioner testified that meals ranged1957 U.S. Tax Ct. LEXIS 68">*81 from $ 4.50 to $ 5 per day and that lodging was $ 15 to $ 20 per week while at Hamburg and Batavia but more expensive in Florida. "Bearing heavily * * * upon the taxpayer whose inexactitude is of his own making," Cohan v. Commissioner, 29 T.C. 16">*22 (C. A. 2, 1930) 39 F.2d 540, 544, we think that $ 8 per day is the amount petitioner expended for meals and lodging.
We have computed the petitioner's traveling expenses (including meals and lodging) in our Findings of Fact, which amount should be used in a recomputation under Rule 50.
Decision will be entered under Rule 50.
Footnotes
1. The respondent increased the allowable standard deduction by $ 303.30 in each year because of the increase in adjusted gross income resulting from the aforementioned disallowance.↩
2. All section references are to the Internal Revenue Code of 1939, as amended.↩
1. If away from Louisville, days include the traveling time of one or two days to and from Louisville at beginning and ending of employment.↩
3. SEC. 22. GROSS INCOME.
(n) Definition of "Adjusted Gross Income". -- As used in this chapter the term "adjusted gross income" means the gross income minus --
* * * *
(2) Expenses of travel and lodging in connection with employment. -- The deductions allowed by section 23 which consist of expenses of travel, meals, and lodging while away from home, paid or incurred by the taxpayer in connection with the performance by him of services as an employee;
SEC. 23. DEDUCTIONS FROM GROSS INCOME.In computing net income there shall be allowed as deductions:
(a) Expenses. --
(1) Trade or business expenses. --
(A) In General. -- All the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business, including * * * traveling expenses (including the entire amount expended for meals and lodging) while away from home in the pursuit of a trade or business; * * *↩
4. The Fisher↩ case involved a professional musician, a native of Milwaukee, Wisconsin, who performed in hotel dining rooms and cocktail lounges throughout the country. His family lived, and had their place of abode, wherever petitioner happened to be working. Petitioner paid part of the telephone bill at his mother-in-law's apartment in Milwaukee, and maintained a mailing address and voted there. We held that petitioner, while away from Milwaukee, was not away from "home."