                  T.C. Summary Opinion 2008-42



                     UNITED STATES TAX COURT



                 JOSEPH CORNELIUS, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket Nos. 4151-06S, 4157-06S.    Filed April 23, 2008.



     Joseph Cornelius, pro se.

     Jeffrey D. Heiderscheit, for respondent.



     CARLUZZO, Special Trial Judge:    Each of these consolidated

cases was heard pursuant to the provisions of section 7463.1




     1
        Unless otherwise indicated, section references are to the
Internal Revenue Code of 1986, as amended, in effect for the
relevant period. Rule references are to the Tax Court Rules of
Practice and Procedure.
                               - 2 -

Pursuant to section 7463(b), the decisions to be entered are not

reviewable by any other court, and this opinion shall not be

cited as precedent for any other case.

     In a notice of deficiency dated November 28, 2005,

respondent determined a $16,445 deficiency in petitioner’s 2002

Federal income tax and additions to tax of $100 and $40 under

section 6651(a)(1) and (2), respectively.    In a separate notice

of deficiency also dated November 28, 2005, respondent determined

a $19,420 deficiency in petitioner’s 2003 Federal income tax and

additions to tax of $1,033.20 and $413.28 under section

6651(a)(1) and (2), respectively.

     All of the adjustments made in the notices of deficiency

have been agreed upon by the parties.    The issues for decision

for each year are:   (1) Whether petitioner is entitled to all or

a portion of a deduction for employee business expenses claimed

on his Federal income tax return received by respondent after the

notice of deficiency was issued; and (2) whether petitioner is

liable for the section 6651(a) additions to tax.

                            Background

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

At the time each petition was filed, petitioner resided in

Austin, Texas.
                                - 3 -

     Petitioner continuously lived and worked in Austin, Texas,

from 1984 until March 2002.    From 1998 until December 2001, he

was employed there as a computer system administrator

specializing in the application and operation of certain business

management software.    Towards the close of 2001, petitioner’s

employer closed its Austin office and petitioner found himself

unemployed.

     In February 2002 petitioner was offered employment on an “as

needed basis” with Princeton Information Systems (PI).    He was

assigned to work in Boulder, Colorado, for a client of PI (the

Colorado assignment).    The Colorado assignment started on March

4, 2002, and continued through April 2003.    Petitioner stayed in

a hotel for the first 2 weeks of the Colorado assignment;

afterwards he lived in a rented condominium apartment.    He

maintained his apartment in Austin until June 2002.

     When the Colorado assignment terminated in April 2003,

another began almost immediately.    This second assignment was for

a client of PI in Basking Ridge, New Jersey (the New Jersey

assignment).   As before, petitioner was hired on an “as needed

basis” by PI in connection with this assignment.    Petitioner

lived and worked in New Jersey from April 2003 through July 2005

although in June 2004 his employment status changed.    While

living and working in New Jersey, petitioner stayed for the first
                               - 4 -

6 months at a Summerfield Suites and thereafter in a shared

rented apartment.

     From time to time while working in Colorado and New Jersey,

petitioner returned to Austin to visit family and friends.

     Petitioner’s 2002 Federal income tax return was not received

by respondent before January 27, 2006.   His 2003 Federal income

tax return was received by respondent on March 10, 2006.     Nothing

in the record suggests that petitioner requested or received an

extension to file either of those returns.    Each of those returns

includes a Schedule A, Itemized Deductions.   As relevant here, on

each Schedule A petitioner claimed a deduction for employee

business expenses.   The majority of each employee business

expense deduction consists of amounts attributable to expenses

for meals and lodging, some relating to the period that

petitioner was working in Colorado and some relating to the

period that petitioner was working in New Jersey.   A portion of

the deduction also is attributable to expenses incurred by

petitioner to travel back and forth to Austin from either

Colorado or New Jersey.

     Each return was prepared by a paid income tax return

preparer.   Each return was untimely because, according to

petitioner, he has a “bad habit of, once * * * [he is] overdue

on something, avoiding it.”
                               - 5 -

                            Discussion

1.   Employee Business Expense Deductions

      Ordinarily, a taxpayer may not deduct personal expenses,

such as the costs of meals and lodging.     Sec. 262.    However, if

properly substantiated, traveling expenses, including meals and

lodging, incurred by a taxpayer during the taxable year while

traveling away from home in the pursuit of a trade or business

are deductible.   Secs. 162(a)(2), 274(d).    To qualify for

deduction under section 162(a)(2), the traveling expense must be:

(1) Reasonable and necessary; (2) incurred while the taxpayer was

traveling “away from home”; and (3) directly related to the

conduct of the taxpayer’s trade or business.     Commissioner v.

Flowers, 326 U.S. 465, 470 (1946).     The reference to “home” in

section 162(a)(2) means the taxpayer’s tax home.        Mitchell v.

Commissioner, 74 T.C. 578, 581 (1980); Foote v. Commissioner, 67

T.C. 1, 4 (1976); Kroll v. Commissioner, 49 T.C. 557, 561-562

(1968).

      For each year in issue, a portion of the employee business

expense deduction includes amounts for meals and lodging expenses

incurred while petitioner was working in either Colorado or New

Jersey.   According to petitioner, the meals and lodging expenses

were incurred while he was away from home for business purposes.
                                  - 6 -

According to respondent, petitioner was not away from home while

working in either Colorado or New Jersey.

     Generally, a taxpayer’s tax home is determined by the

location of the taxpayer’s regular or principal (if more than one

regular) place of business regardless of where the taxpayer’s

residence is located.      Mitchell v. Commissioner, supra at 581;

Kroll v. Commissioner, supra at 561-562; sec. 1.911-2(b), Income

Tax Regs.    Usually, if the location of the taxpayer’s regular

place of business changes, so does the taxpayer’s tax home--from

the old location to the new location--unless the period of

employment at the new location is, or is reasonably expected to

be, temporary.    Kroll v. Commissioner, supra, at 562-563;

Mitchell v. Commissioner, T.C. Memo. 1999-283.      By law, a

“taxpayer shall not be treated as being temporarily away from

home during any period of employment if such period exceeds 1

year.”    Sec. 162(a).

     According to petitioner neither Boulder, Colorado, nor

Basking Ridge, New Jersey, should be treated as his tax home

during the years in issue because his assignments there were

temporary.    See Horton v. Commissioner, 86 T.C. 589, 593-595

(1986).   Respondent points out that both assignments exceeded

1 year in duration.      Relying upon the above-quoted language

of section 162(a), respondent argues that neither of petitioner’s

assignments may be considered temporary.
                               - 7 -

According to respondent, petitioner’s tax home was in Boulder

during the period that he was assigned to work and lived there,

and his tax home was in Baskin Ridge during the period that he

worked and lived there.   Respondent argues that the meals and

lodging expenses petitioner incurred during those periods of

employment are nondeductible personal expenses because the

expenses were not incurred while petitioner was traveling away

from his tax home.   See sec. 262(a).   For the following reasons,

we agree with respondent.

     Given the circumstances surrounding his employment during

2002 and 2003, we can understand why petitioner might consider

his PI assignments to be “temporary”, as that word is commonly

used and understood.   Nevertheless, because each of petitioner’s

assignments was for a period that exceeded 1 year, neither can be

treated as a temporary assignment for Federal income tax

purposes.   Consequently, because petitioner’s Colorado assignment

lasted for more than 1 year, that location is considered his tax

home during the period he worked there.   Similarly, because

petitioner’s New Jersey assignment lasted for more than 1 year,

his tax home changed from Boulder to Baskin Ridge, and the latter

location was his tax home during the period that he worked there.

It follows that petitioner is not entitled to the portion of the

employee business expense deduction attributable to amounts for

meals and lodging for either year in issue.
                                 - 8 -

      Furthermore, because the expenses related to traveling back

and forth between Austin and Colorado or Austin and New Jersey

were incurred for personal purposes, petitioner is not entitled

to a deduction for those expenses.       See Commissioner v. Flowers,

supra.

      Because the remaining itemized deductions claimed for each

year do not exceed the standard deduction applicable to

petitioner’s filing status, see sec. 63, we need not consider

petitioner’s entitlement to those deductions.

      On the other hand, as discussed at trial, we think it

appropriate to address an issue not raised by petitioner.      It

appears that petitioner might be entitled to a section 217 moving

expense deduction for his move from Austin to Colorado in 2002

and/or for his move from Colorado to New Jersey in 2003.      If so,

the Court expects that the parties will take the allowance of

such deductions into account in the computations for entry of

decision in each case.

2.   Section 6651(a) Additions to Tax

      Petitioner’s 2002 return was due to be filed on or before

April 15, 2003, but it was not submitted for filing before

January 2006; his 2003 return was due to be filed on or before

April 15, 2004, but it was not received by respondent until March

2006.    See sec. 6072(a).   Consequently, respondent imposed a

section 6651(a)(1) addition to tax for each year in issue.
                                - 9 -

     Section 6651(a)(1) provides for an addition to tax of 5

percent of the amount of the tax required to have been shown on

the return if the failure to file is for not more than 1 month,

with an additional 5 percent for each month in which the failure

to file continues, to a maximum of 25 percent of the tax in the

aggregate.   If an income tax return is not filed within 60 days

of the prescribed date for filing (including extensions), the

addition to tax imposed is not less than the lesser of $100 or

100 percent of the amount required to be shown as a tax on the

return.   The addition to tax is applicable unless it is shown

that the failure to file is due to reasonable cause and not due

to willful neglect.    The amount of the addition to tax is

calculated on the net amount due.    Sec. 6651(b).

     It is not clear whether petitioner’s return for either year

in issue was filed or processed by respondent, although it is

clear that both returns were received by respondent more than 4

months late.   Petitioner’s explanation for his failure to file a

timely return for each year hardly establishes reasonable grounds

for that failure.    Otherwise, petitioner does not challenge the

amount of the section 6651(a)(1) addition to tax for either year,

and nothing in the record suggests that the amounts are not

properly computed.    Respondent’s imposition of the section

6651(a)(1) addition to tax for each year in issue is sustained.
                               - 10 -

     Respondent also imposed a section 6651(a)(2) addition to tax

for each year in issue.    In general, that section provides for an

addition to tax in the case of the failure to pay an amount of

tax shown on a return.    The amount of the section 6651(a)(2)

addition to tax shown in each notice of deficiency was computed

before respondent’s receipt of petitioner’s return for each year.

     The Court cannot determine:   (1) Whether petitioner’s 2002

or 2003 untimely return was processed by respondent; or (2)

whether in the absence of a timely return for either year,

respondent prepared a substitute for return, or a section 6020(b)

return.   See Cabirac v. Commissioner, 120 T.C. 163, 170-171

(2003).

     As with the section 6651(a)(1) additions to tax, respondent

bears the burden of production with respect to the imposition of

the section 6651(a)(2) additions to tax.    That burden has not

been satisfied with respect to the section 6651(a)(2) addition to

tax for either 2002 or 2003, and petitioner is not liable for a

section 6651(a)(2) addition to tax for either year.

     To reflect the foregoing,


                                           Decisions will be

                                     entered under Rule 155.
