- 36 -
income tax deficiencies because he failed to show that the
deficiencies were related to his business income. Similarly, in
Tanner v. Commissioner, 45 T.C. 145, 149-150 (1965), affd. per
curiam 363 F.2d 36 (4th Cir. 1966), we were obliged to
distinguish Standing, in refusing to allow a deduction for State
income taxes under former section 62(a)(1). We reasoned that,
whereas former section 62(a)(1) was silent on the deductibility
of interest and legal expenses attributable to the underpayment
of business income, former section 62(a)(1) and its legislative
history clearly barred an individual from deducting the State
income taxes on business income.
It is with this backdrop that I proceed to address the
validity of the regulations at hand. The Commissioner claims
that she validly prescribed section 1.163-9T(b)(2)(i)(A),
Temporary Income Tax Regs., 52 Fed. Reg. 48409 (Dec. 22, 1987),
based on the legislative history of section 163(h) and the Staff
of Joint Comm. on Taxation, General Explanation of the Tax Reform
Act of 1986, at 266 (J. Comm. Print 1987) (the 1986 Bluebook).5
5 The Joint Committee of Taxation for the 100th Congress
(Joint Committee) consisted of five Senators and five members of
the House of Representatives. The 1986 Bluebook, at II. The
1986 Bluebook was prepared by the Staff of the Joint Committee,
in consultation with the staffs of the House Ways and Means
Committee and the Senate Finance Committee. Letter from David H.
Brockway, Chief of Staff, to the Hon. Dan Rostenkowski, Chairman,
and the Hon. Lloyd Bentsen, Vice-Chairman, id. at XVII.
According to Mertens, Law of Federal Income Taxation, sec. 3.20,
at 31 (1994):
The purpose of the Blue Book is to provide, in one
volume, a compilation of the legislative history of a
piece of tax legislation. While the document is most
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