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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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