Masonry Magazine January 1970 Page.32
Washington Wire
(Continued from page 23)
reduced by the amount of the aunt's pension before the balance of these expenses could be deducted by the taxpayer. McDermid v. Commissioner, 54 TC-No. 172.
MOVING EXPENSES
Here is an example of where ignorance of the law can cause a person tax dollars. The taxpayer, a certified public accountant by profession, terminated his employment as general manager of a company in North Carolina and moved with his family to Wisconsin. In Wisconsin, the taxpayer obtained a job as controller for a corporation and he worked for them for 35 weeks and 2 days, and then quit and went into private practice as a certified public accountant. It had cost the taxpayer some $1,263 to move from North Carolina to Wisconsin and this sum he deducted on his income tax return.
When the propriety of the deduction reached the Tax Court, the taxpayer lost out. While the '69 Tax Reform Act amended the rules on deductibility of moving expenses to include self-employed individual, it also provided that such individuals must become full time employees "for 39 weeks" out of the 12 months immediately following the move.
Thus, had this taxpayer only waited three weeks and five days longer before terminating his employment, the considerable cost of his move to Wisconsin would have been fully deductible. T.C. Memo 1970-262.
ENGINEERING COURSES
The duties of a taxpayer, who was employed in his father's construction company, were to check shop drawings, give estimates on construction projects, to act as purchasing agent and other work to enable the company to bid on construction jobs. The taxpayer enrolled in several courses that would lead to a degree in architectural engineering and deducted on his income tax return the cost of the school's tuition (some $1,114.)
When this matter was presented to the Tax Court for determination, the claimed deductions were disallowed. The taxpayer, the court noted, had not shown that his education was undertaken primarily to maintain or improve skills required in his existing employment. He was not required to attend architectural school to maintain his position. Therefore, his educational expenses were not deductible as ordinary and necessary business expenses. Samford v. Commissioner, T.C.Memo 1970-258.
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masonry • Nov./Dec., 1970