                  T.C. Summary Opinion 2008-151



                      UNITED STATES TAX COURT



                 LARRY W. KOEPKE, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 21111-05S.             Filed December 4, 2008.



     Larry W. Koepke, pro se.

     Lisa M. Oshiro, for respondent.




     GERBER, Judge:   This case was heard pursuant to the

provisions of section 7463 of the Internal Revenue Code in effect

when the petition was filed.1   Pursuant to section 7463(b), the

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


     1
       Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for 2003, the taxable year in
issue, and all Rule references are to the Tax Court Rules of
Practice and Procedure.
                                - 2 -

this opinion shall not be treated as precedent for any other

case. Respondent determined a $7,816 deficiency in petitioner’s

2003 Federal income tax.   The deficiency arises from respondent’s

disallowance of several deductions petitioner claimed on his 2003

income tax return.   Respondent, in his answer to petitioner’s

amended petition, asserted a $1,563.20 accuracy-related penalty

under section 6662(a).

     Respondent has conceded petitioner’s entitlement to the

following deductions:    State and local income tax--$5,414; real

estate tax--$2,986; home mortgage interest--$11,308; other

expenses--$185, subject to the 2 percent of adjusted gross income

(AGI) limitation; and union and professional dues--$738, subject

to the 2 percent of AGI limitation; and respondent has also

conceded that the section 6662(a) accuracy-related penalty does

not apply.

     The following deductions remain in controversy:   Gifts to

charity--$855; equipment--$224; unreimbursed employee expenses--

$14,308.

                           Background

     Petitioner resided in Wisconsin at the time his petition was

filed.   He worked for Northwest Airlines (Northwest) as an

aircraft mechanic for over 20 years.    Petitioner’s residence was

close to Northwest’s Minneapolis, Minnesota, home base.   During

2001 petitioner was Northwest’s lead mechanic in Alaska, but he
                                - 3 -

returned to Minneapolis during 2002.    During 2003 Northwest

instituted a reduction-in-force, and on March 26, 2003,

petitioner was displaced under a seniority system from his

Minneapolis position to a position in Newark, New Jersey.    This

seniority system was defined in the employment contract with

Northwest.

     Under the contract, if employees were laid off, they could

use their seniority to gain placement in a city where they were

most senior.   In effect, the use of the seniority system in a

layoff situation had a “domino effect” caused by the most senior

person who had been laid off selecting another city where he was

most senior and thereby displacing another employee and so on.

If there had been someone less senior in Minneapolis when

petitioner was laid off, he would have had the option to remain

in Minneapolis.   Because there was no less senior person in

Newark, petitioner moved to Newark where his seniority permitted

him to work.

     Under the circumstances, there was no way to determine the

length of time that petitioner would remain in Newark or any

other city.    On April 2, 2003, petitioner was served with another

reduction-in-force notice, but it was rescinded shortly

thereafter.    On May 23, 2003, however, another reduction-in-force

was issued.    A person from Minneapolis who was more senior than

petitioner exercised his seniority to bump petitioner in Newark
                               - 4 -

and, in turn, petitioner exercised his seniority to bump someone

less senior, thereby moving to Philadelphia, Pennsylvania.

Petitioner finished out 2003 in Philadelphia, but there were

occasions where he was close to being bumped again.    During the

period under consideration, Northwest laid off 2,700 people,

including 110 lead mechanics, and those layoffs generated

petitioner’s movement from city to city.

     Petitioner remained in Philadelphia until February or March

2005 when another round of layoffs occurred.    Subsequently, he

was forced to go to Houston, Texas, where he worked for 2-1/2

months, and then he moved to Seattle, Washington, where he

remained until the end of 2005.    Throughout the layoffs and

“seniority moves” from city to city, petitioner has always

maintained his house in the Minneapolis area and considered that

his permanent residence.   When petitioner was not working in

Minneapolis, he claimed deductions for travel from Minneapolis to

his duty station and transportation from what he considered his

temporary residence to the airport where he worked.

     For 2003 petitioner deducted $10,572 of “Unreimbursed

Employee Business Expenses” as follows:    Standard automobile

mileage–$3,252; travel expense while away from home--$4,840;

meals and entertainment--$2,480.    Respondent disallowed the

entire amount for failure to substantiate and/or otherwise meet

the requirements of section 274(d).    Petitioner prepared logs
                                - 5 -

detailing the $10,572 of expenditures at the end of the year

2003.

                             Discussion

       In general, the Commissioner’s determinations in a notice of

deficiency are presumed correct.    Welch v. Helvering, 290 U.S.

111, 115 (1933).    In pertinent part, Rule 142(a)(1) provides the

general rule that “The burden of proof shall be upon the

petitioner”.    In certain circumstances, however, if the taxpayer

introduces credible evidence with respect to any factual issue

relevant to ascertaining the proper tax liability, section 7491

places the burden of proof on the Commissioner.    Sec. 7491(a)(1);

Rule 142(a)(2).    Section 7491(a)(1) applies only if the taxpayer

complies with substantiation requirements, maintains all required

records, and cooperates with the Commissioner’s requests for

witnesses, information, documents, meetings, and interviews.

Sec. 7491(a)(2).    The record shows that petitioner did not comply

with the substantiation requirements.     In addition, no question

was raised by the parties as to the burden or proof or going

forward with evidence.

       This Court has considered the deductibility of travel,

meals, and lodging expenses of similarly situated Northwest

employees who were likewise bumped or displaced by layoffs and

downsizing.    See, e.g., Wasik v. Commissioner, T.C. Memo. 2007-

148.    The question that is decided in each of these cases is
                               - 6 -

whether the taxpayer was temporarily away from home within the

meaning of section 162.

     A taxpayer may deduct such expenses while away from home in

the pursuit of a trade or business.    Secs. 162(a)(2), 262(a);

Commissioner v. Flowers, 326 U.S. 465 (1946).    The word “home”

for purposes of section 162(a)(2) generally refers to the area of

a taxpayer’s principal place of employment, not the taxpayer’s

personal residence.   Daly v. Commissioner, 72 T.C. 190, 195

(1979), affd. 662 F.2d 253 (4th Cir. 1981).    There is an

exception to the general rule that a taxpayer’s tax home is his

or her principal place of employment if the taxpayer’s employment

away from home is temporary.   Peurifoy v. Commissioner, 358 U.S.

59, 60 (1958);   Mitchell v. Commissioner, T.C. Memo. 1999-283.

     Petitioner argues that his employment in cities other than

Minneapolis was temporary under the union contract with Northwest

because he ultimately had a guaranteed position in Minneapolis

once his seniority situation was such that he could return.    In

other words, he had a right to bump less senior Northwest

employees in Minneapolis, and Northwest could not defeat that

right by a new hire or transfer of an existing employee with less

seniority.   That aspect of the union contract, petitioner

contends, makes Minneapolis his tax home, and his positions in

other cities are temporary.
                                - 7 -

     We consider all of the facts and circumstances when

considering the situs of and/or whether a taxpayer has a tax

home.   See Rev. Rul. 73-529, 1973-2 C.B. 37.   A taxpayer must

generally have some business justification to maintain a

residence, beyond purely personal reasons, so as to be entitled

to deduct expenses incurred while temporarily away from that

home.   Hantzis v. Commissioner, 638 F.2d 248, 255 (1st Cir.

1981), revg. T.C. Memo. 1979-299; Bochner v. Commissioner, 67

T.C. 824, 828 (1977).   If a taxpayer has no business connection

with the primary residence, it has been held that there is no

compelling reason to maintain that residence and incur

substantial, continuous, and duplicative expenses elsewhere.      See

Henderson v. Commissioner, 143 F.3d 497, 499 (9th Cir. 1998),

affg. T.C. Memo. 1995-559; Hantzis v. Commissioner, supra.     In

that situation, the expenses incurred while temporarily away from

that residence are not deductible. Hantzis v. Commissioner,

supra; Bochner v. Commissioner, supra.

     Petitioner’s work situation before and during 2003 was such

that he was subject to being laid off because of Northwest’s

downsizing.   Although he was in no city for an extended period,

under the employment contract his choices were either to be laid

off and not work or to exercise his seniority and bump an

employee in a different city.   Petitioner’s work situation was

indeterminate, as he did not know when and if Northwest would
                                - 8 -

continue to downsize and/or the length of time that he would

remain in any particular city where he had bumped a less senior

person.   We recognize that petitioner maintained a home in the

Minneapolis area and he intended to use the terms of the union

contract to return to Minneapolis if his seniority was such that

he could.    We are also sympathetic to petitioner’s situation, as

we recognize that he was forced to involuntarily move from city

to city in order to continue earning a living.

     These circumstances, however, do not make Minneapolis

petitioner’s tax home at the time that he chose to move from

there in order to continue working for Northwest, albeit in

another city.   When he moved from Minneapolis, his business ties

to that location ended.   The reality of petitioner’s situation

was that he did not know how long he would be in any of the

cities in which he worked or where he would go next.   With those

circumstances petitioner’s time in any city could not be termed

“temporary”, and there was no way to predict or know when he

could   return to Minneapolis under the seniority system.

     Although petitioner’s situation is a hardship upon him,

there is no statutory provision that provides relief for his

situation.   Under established principles of tax law, petitioner

was not “away from home” during 2003, and we must hold that he is

not entitled to deduct the $10,572 in travel and meal expenses.
                                - 9 -

     With respect to the remaining employee business items in

dispute, respondent determined that petitioner failed to

substantiate or to show the employee business purpose of the

claimed expenditures.   See secs. 162, 212.    Taxpayers are

required to maintain records sufficient to permit the

verification of income and expenses.    Sec. 6001.   As a general

rule, if the trial record provides sufficient evidence that the

taxpayer has incurred a deductible expense, but the taxpayer is

unable to adequately substantiate the precise amount of the

deduction, the Court may estimate the amount of the deductible

expense and allow a deduction to that extent.     Cohan v.

Commissioner, 39 F.2d 540, 543-544 (2d Cir. 1930).     Such

estimates are to be made bearing heavily against the

taxpayer whose inexactitude in substantiating the amount of the

expense is of his own making.    Id. at 544.   However, in order for

the Court to estimate the amount of an expense, the Court must

have some basis upon which an estimate may be made.     Vanicek v.

Commissioner, 85 T.C. 731, 742-743 (1985).

     During 2003 petitioner purchased a device for $224 that

permitted his computer to receive wireless Internet service.

During 2003 he lived in places where wireless Internet service

was available, and he used that service to check Northwest’s

postings of changes of post of duty because of seniority.

Petitioner also paid $312, during 2003, for an Internet service
                              - 10 -

provider.   Although petitioner has adequately substantiated these

expenditures and it was ordinary and necessary for him to keep

abreast of his work assignments, some portion of petitioner’s use

of the Internet was personal and not business related.   On the

record before us, we find and hold that petitioner is entitled to

deduct $100 for 2003, and respondent is sustained on the

disallowance of the remaining $436 ($224 plus $312 equals $536,

less $100 equals $436).

     We find and hold that for 2003 petitioner is entitled to

deduct the following amounts as employee business-related items:

$70 to maintain his mechanic’s license; $156 for prescription

safety glasses; $154 for steel-toed, special-soled boots that

remained at the work place because of acid and oil accumulation;

$1,022 for tools needed to properly perform his job; $92 for

transportation between job and union meetings; $68.36 for a

winter parka with the Northwest logo because such clothing was

necessary but not provided by Northwest; and $822 for cleaning

uniforms provided by Northwest.

     During 2003 petitioner attended church intermittently and

would make contributions on each such occasion.   Petitioner

recorded the date and amount of each contribution on a calendar

which he used to assist in the preparation of his 2003 tax

return.   He attended church on 24 occasions during 2003 and made

contributions ranging from $10 to $50, for a total of $855 for
                              - 11 -

the year.   Based on the record, petitioner is entitled to deduct

$855 for contributions for 2003.

     To reflect the foregoing,

                                      Decision will be entered

                                 under Rule 155.
