Holland E. Bynam - Page 10




                                       - 10 -                                         
               Although it is true that the Federal Government reimburses             
          school districts for one-half the “additional amount” paid to               
          retired officers, see 10 U.S.C. sec. 2031(d)(1), the ultimate               
          burden of disbursing funds and establishing compensation scales             
          lies with the employing school, see Lyle v. Commissioner, supra             
          at 674; Tucker v. Commissioner, supra.  In this regard, the                 
          employing institution is responsible for issuing compensation               
          checks and Forms W-2 to all of its employees.  Petitioner’s                 
          understanding of the degree of control that the employing school            
          exercises is illustrated by the following passage from the trial            
          transcript:                                                                 

                    The civilian folk who are really the employing --                 
               they’re designated as the employing agency for good                    
               reasons.  They’ve got to keep the records, they’ve got                 
               to turn in the W-2 materials, they can fire you.                       
                                 *  *  *  *  *  *  *                                  
                    The principal can recommend retention or recommend                
               that you lose your credentials for being able to teach,                
               or in the case of a serious violation * * * they can                   
               recommend immediate dismissal * * *                                    

               Clearly, the Federal Government does not assume any kind of            
          employer status.  Therefore, it is inconceivable that any portion           
          of the compensation that petitioner received as a JROTC                     
          instructor could be classified as a subsistence, quarters, or               
          variable housing allowance from the Armed Forces.  See Lyle v.              
          Commissioner, supra at 674.                                                 








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