United States Court of Appeals,
Eleventh Circuit.
Nos. 94-2340, 94-2776.
Dan P. BUTTS and Cynthia D. Butts, Petitioners-Appellees,
v.
COMMISSIONER OF INTERNAL REVENUE, Respondent-Appellant.
A. Wayne SMITHWICK and Roseanne M. Smithwick, Petitioners-
Appellees,
v.
COMMISSIONER OF INTERNAL REVENUE, Respondent-Appellant.
April 10, 1995.
Appeals from the Decision of the United States Tax Court. (Nos.
18289-92, 1458-92).
Before DUBINA, Circuit Judge, RONEY and ESCHBACH*, Senior Circuit
Judges.
PER CURIAM:
These two appeals by the Commissioner of Internal Revenue,
consolidated for oral argument, involve the appropriate tax
treatment to be given to the arrangement of the taxpayers as agents
selling life, automobile, fire, and other types of insurance for
Allstate Insurance Company. The Commissioner of Internal Revenue
contends they should be treated as employees. The taxpayers
successfully contended in the United States Tax Court that they are
independent contractors. We affirm.
These cases were heard and appealed separately from the
decisions of different Tax Court judges, but the controlling facts
are the same. When taxpayers first started selling Allstate
*
Honorable Jesse E. Eschbach, Senior U.S. Circuit Judge of
the Seventh Circuit, sitting by designation.
insurance, they were concededly employees working under an Allstate
Agent Compensation Agreement. Subsequently, they entered into a
"Neighborhood Office Agent Amendment to Allstate Compensation
Agreement."
The case of Dan P. and Cynthia Butts was first decided by Tax
Court Judge Marvin P. Peterson on October 21, 1993. The sole issue
presented was whether petitioner Dan P. Butts performed services
for Allstate as an employee or as an independent contractor. Based
upon a hearing and some stipulated facts in a thoroughly reasoned
opinion, Judge Peterson held that petitioners had met their burden
of proving that Mr. Butts' professional relationship with Allstate
was not as an employee, rather that he was associated with Allstate
as an independent contractor. Thus, the taxpayers' business
deductions were to be reported under Schedule C of the tax return
and not as Schedule A unreimbursed employee business expenses.
Butts v. Commissioner of Internal Revenue, T.C.Memo 1993-478, 66
T.C.M. (CCH) 1041, 1993 WL 410704 (U.S.Tax Ct.1993).
Subsequently, on December 9, 1993, Tax Court Judge Charles E.
Clapp, II, decided that the A. Wayne and Roseanne M. Smithwick
case, involving the identical Allstate agreements involved in the
Butts case, had no relevant facts that are distinguishable from the
Butts case. Accordingly, Judge Clapp decided the case for the
petitioners on the basis of the reasoning in Butts. Smithwick v.
Commissioner of Internal Revenue, T.C.Memo 1993-582, 66 T.C.M.
(CCH) 1545, 1993 WL 503911 (U.S.Tax Ct.1993).
Prior to oral argument, this Court was advised of yet another
case involving the identical Allstate agreements in which the Tax
Court, relying on the decision in Butts, reached the same
conclusion. Mosteirin v. Commissioner of Internal Revenue, No.
3996-94 (U.S.Tax Ct., Jan. 13, 1995). We were informed at oral
argument that there are currently pending eleven other cases
concerning the same issue.
We affirm based upon the findings and reasoning of the Tax
Court's decision in Butts. Prompt resolution of the issue by this
Court is critical. Since the Tax Court's detailed opinion is
readily available to the tax bench and bar and no additional
arguments were made to this Court that were not properly treated in
Judge Peterson's opinion, there is no need to prepare a detailed
opinion of this Court nor to attach the Tax Court decision for
reference. This opinion is sufficient to establish the law of this
Circuit for precedential purposes.
AFFIRMED.