                   T.C. Summary Opinion 2009-183


                      UNITED STATES TAX COURT



               NANCY BADAYOS MAGIMOT, Petitioner v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 1590-08S.               Filed December 3, 2009.



     Keith S. Blair, John B. Snyder, and Jean Hartman (student),

for petitioner.

     Noelle C. White, for respondent.



     DEAN, Special Trial Judge:   This case was heard under the

provisions of section 7463 of the Internal Revenue Code in effect

when the petition was filed.   Pursuant to section 7463(b), the

decision to be entered is not reviewable by any other court, and

this opinion shall not be treated as precedent for any other

case.   Unless otherwise indicated, subsequent section references
                               - 2 -

are to the Internal Revenue Code in effect for the years at

issue, and all Rule references are to the Tax Court Rules of

Practice and Procedure.

      Respondent determined deficiencies in petitioner’s Federal

income taxes of $9,454 for 2003 and $8,856 for 2004.    The issue

for decision is whether petitioner was eligible for an exemption

from income tax in 2003 and 2004 under the Convention With

Respect to Taxes on Income, U.S.-Phil., art. 21, Oct. 1, 1976, 34

U.S.T. 1277 (article 21).

                            Background

      Some of the facts have been stipulated and are so found.

The stipulation of facts and the exhibits received into evidence

are incorporated herein by reference.    When petitioner filed her

petition, she resided in Maryland.

      Petitioner electronically filed Forms 1040, U.S. Individual

Income Tax Return, for 2003 and 2004.    On Schedule A, Itemized

Deductions, for 2003, she deducted $1,548 of State and local

income taxes and $55,174 of income as tax exempt under article

21.   On Schedule A for 2004, she deducted $1,319 of State and

local income taxes and $55,096 of income as tax exempt under

article 21.

      On November 2, 2007, respondent issued to petitioner a

notice of deficiency disallowing the article 21 deductions for
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2003 and 2004 and the State and local income tax deduction for

2004.1

     Petitioner is a citizen of the Philippines and is trained as

an educator with teaching experience in both the United States

and the Philippines.   In 2002 the Ravenswood City School District

(Ravenswood) in California interviewed her in the Philippines and

hired her to teach in the United States.   Petitioner agreed to

teach at Ravenswood and signed a 3-year teaching contract.

The Amity Institute (Amity), a nonprofit organization that

sponsors international educators to teach at schools in the

United States, agreed to sponsor petitioner’s teaching visa for a

3-year term.   On May 13, 2002, petitioner signed a 3-year

contract with Amity for its services.

     Petitioner then applied for an exchange visitor (J-1) visa,

requesting a 3-year period from July 25, 2002, through July 24,

2005.    She was issued a visa effective June 3, 2002, through July

24, 2005.

     Petitioner arrived in the United States on August 9, 2002,

and from August 2002 through June 2006 she taught at Ravenswood.

In 2003 and 2004 petitioner earned $55,174 and $55,096,

respectively, and on Schedule A she reported a miscellaneous

itemized deduction of $55,174 for 2003 and $55,096 for 2004.


     1
      Respondent also disallowed the standard deduction for 2003.
Respondent concedes that petitioner is entitled to the standard
deduction for both 2003 and 2004.
                                 - 4 -

For 2003 and 2004 respondent determined that petitioner’s

Ravenswood salary was taxable income.

                              Discussion

     Generally, the Commissioner’s determinations in a notice of

deficiency are presumed correct, and the taxpayer has the burden

of proving that those determinations are erroneous.    See Rule

142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933).     In certain

circumstances, however, section 7491(a)(1) places the burden of

proof on the Commissioner.    Petitioner has not alleged that

section 7491 is applicable, nor has she established compliance

with the requirements of section 7491(a)(2)(A).    Therefore, the

burden of proof does not shift to respondent.

     The interpretation of treaty provisions must begin with the

language of the treaty.     N.W. Life Assurance Co. of Can. v.

Commissioner, 107 T.C. 363, 378-379 (1996).     The role of the

judiciary in interpreting treaty provisions is to decide their

underlying intent or purpose.     Estate of Silver v. Commissioner,

120 T.C. 430, 434 (2003).    The Court therefore will begin its

analysis by examining the treaty itself.    Article 21, Teachers,

provides:

          (1) Where a resident of one of the Contracting States
     is invited by the Government of the other Contracting State,
     a political subdivision or local authority thereof, or by a
     university or other recognized educational institution in
     that other Contracting State to come to that other
     Contracting State for a period not expected to exceed 2
     years for the purpose of teaching or engaging in research,
     or both, at a university or other recognized educational
                                - 5 -

     institution and such resident comes to that other
     Contracting State primarily for such purpose, his income
     from personal services for teaching or research at such
     university or educational institution shall be exempt from
     tax by that other Contracting State for a period not
     exceeding 2 years from the date of his arrival in that other
     Contracting State.

     Respondent contends that petitioner fails to qualify for

benefits under article 21 because she did not establish that she

came to the United States “for a period not expected to exceed 2

years for the purpose of teaching”.     In support, respondent cites

the Treasury Department Technical Explanation of article 21.

Treasury Department Technical Explanation of the Convention

Between the United States and the Philippines, 1984-2 C.B. 412,

424 (Treaty explanation).   The Treaty explanation for article 21

states that “if the period of the visit had been expected to

exceed two years then the exemption does not apply to any of the

income earned.”   Id.   The plain language and the Treaty

explanation of article 21 specify that petitioner must establish

that she agreed to teach in the United States “for a period not

expected to exceed 2 years”.    Id.

     In support of her contention that she did not expect her

stay in the United States to exceed 2 years, petitioner alleges

that the length of the Amity contract and the term of her visa

stay are not indicative of her expectation.    She asserts that she

was required to sign a 3-year contract with Amity because Amity
                               - 6 -

did not offer contract terms for less than 3 years and she was

unaware that she could request a visa for less than 3 years.

     Petitioner testified that she did not expect to remain in

the United States for over 2 years.    During her first 2 years in

the United States her family remained in the Philippines, and she

visited them during her winter and summer breaks.   She signed

only yearly apartment leases in the United States, and in 2004

she purchased a home in the Philippines.

     Notwithstanding whether petitioner had a choice regarding

the length of the Amity contract, she signed the contract.    The

contract indicates that she expected to remain in the United

States for a period to exceed 2 years.   Petitioner alleges that

had she not signed the contract, she would not have been able to

teach in the United States.   But she did not provide the Court

with any credible evidence, beyond her testimony, demonstrating

that it was Amity’s policy to restrict contract offers to a 3-

year term.   By signing a 3-year contract, petitioner acknowledged

that she would stay in the United States for more than 2 years.

Without more, the Court cannot find that she expected to remain

in the United States for less than 2 years.

     In addition, petitioner applied for a visa and requested a

3-year term, indicating that she would remain in the United

States for over 2 years.   The Amity contract and petitioner’s

request for a visa, both of which were in effect for a 3-year
                                 - 7 -

period, indicate that petitioner expected to stay in the United

States for more than 2 years.

     The record also indicates that Ravenswood expected

petitioner to teach at the school for 3 years under their

agreement.

     The foregoing evidence indicates that all parties involved--

petitioner, Amity, and Ravenswood--expected petitioner’s stay in

the United States to extend for more than 2 years.         Therefore

petitioner is not entitled to the benefit under article 21, and

respondent’s determination is sustained.

     Other arguments made by the parties and not discussed herein

were considered and rejected as irrelevant, without merit, or

moot.

     To reflect the foregoing,


                                              Decision will be entered

                                         under Rule 155.
