Internal Revenue Service
Revenue Ruling

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 Rev. Rul. 61-95

1961-1 C.B. 749

Full Text

Rev. Rul. 61-95 /1/

The Internal Revenue Service does not agree with the test for determining the deductibility of meals and lodging as traveling expenses which was applied in the recent decision of the United States Court of Appeals for the Ninth Circuit in John J. Harvey v. Commissioner , 283 Fed.(2d) 491 (1960).

The question involved in that case was whether an aircraft worker who was transferred by his employer to Edwards Air Force Base to work for an uncertain period of time and who was continuously employed there for more than a year was traveling away from home for the purpose of deducting, under section 23(a)(1)(A) of the Internal Revenue Code of 1939, expenses incurred for his meals and lodging during that period.

The Ninth Circuit reversed the Tax Court and held that the taxpayer was `away from home' while at Edwards Air Force Base. The decision was based on the reasoning that since there was no reasonable probability known to the taxpayer that he would be employed at Edwards for a long period, it was not reasonable to expect him to move his permanent abode even though his employment there was indefinite in the sense that its termination could not be foreseen within a fixed period.

While a petition for certiorari to the Supreme Court of the United States was not filed in the Harvey case, the Service does not agree with the test which the Ninth Circuit applied in determining whether a taxpayer is at home or is away from home while working at his new station and will continue to apply its usual `temporary v. indefinite' test as explained in Revenue Ruling 60-189, C.B. 1960-1, 60, at 63-64. Under this test, a taxpayer is not traveling away from home unless, at the time his employment at a new duty station is begun, the termination of his employment here within a reasonably short period of time is foreseeable. This position was approved in 1957 by the Fourth Circuit in Commissioner v. Peurifoy , 254 Fed.(2d) 483, affirmed 358 U.S. 59, Ct. D. 1832, C.B. 1958-2, 916, and in 1959 by the Fifth Circuit in Claunch v. Commissioner , 264 Fed.(2d) 309.

/1/ Based on Technical Information Release 314, dated April 18, 1961.