Peurifoy v. Commissioner

1958-12-08

Headline: Construction workers’ board, lodging, and trip-home deductions denied as Court affirms appeals court, making it harder for job-site workers to claim such expenses unless employment is clearly temporary.

Holding: The Court affirmed the appeals court’s reversal and ruled that the Tax Court’s finding of temporary employment was not supported, so the workers’ travel and lodging deductions were disallowed.

Real World Impact:

Makes it harder for traveling construction workers to deduct board, lodging, and travel expenses.
Leaves deductions to be decided case-by-case based on whether employment is "temporary."
Affirms appeals court review of Tax Court factual findings.

Topics: tax deductions, work travel expenses, construction workers, definition of home

Summary

Background

Three construction workers labored at a Kinston, North Carolina worksite for continuous periods of 20½, 12½, and 8½ months ending in 1953. Each kept a permanent home elsewhere in the State. For their 1953 tax returns they deducted the cost of board and lodging while working in Kinston and transportation home after the jobs ended. The Internal Revenue Service disallowed those deductions, the Tax Court allowed them, and the Court of Appeals reversed.

Reasoning

The Supreme Court narrowed the dispute to a single factual question: were the workers’ employments “temporary” or “indefinite”? Under the general rule in Commissioner v. Flowers, travel deductions are typically allowed only when required by the business’s needs; but the Tax Court had applied an exception permitting deductions when employment is temporary. The Commissioner did not attack that exception, so the case turned on the factual finding. The Court concluded the Court of Appeals fairly assessed the record, found the Tax Court’s temporary-employment finding clearly erroneous, and therefore declined to overturn the appeals court.

Real world impact

The decision affects itinerant workers who keep a home elsewhere, such as construction crews who move from job to job. It makes eligibility for board, lodging, and trip‑home deductions depend on the factual determination that a job is temporary. Because the ruling rests on facts here, it does not settle the broader legal question of how to define a taxpayer’s “home.”

Dissents or concurrances

Justice Douglas (joined by Justices Black and Whittaker) dissented, arguing that expenses were necessary, that “home” should mean where a taxpayer’s family lives, and that the deductions should be allowed.