- 18 -
Meals and lodging are furnished for the “convenience of the
employer” if there is a direct nexus between the meals and
lodging furnished and the asserted business interests of the
employer served thereby. McDonald v. Commissioner, 66 T.C. 223,
230 (1976).
Petitioners assert that Mr. Tschetter, as the corporation’s
sole employee, was required to be available for duty 24 hours a
day.
Wolf Creek Farm leased the homestead to Mr. Tschetter. Wolf
Creek Farm contracted with Mr. Tschetter as a tenant, not as its
employee, to perform all necessary work.
It is well settled that “Ordinarily, taxpayers are bound by
the form of the transaction they have chosen; taxpayers may not
in hindsight recast the transaction as one that they might have
made in order to obtain tax advantages.” Framatome Connectors
USA Inc. v. Commissioner, 118 T.C. 32, 70 (2002) (citing Estate
of Leavitt v. Commissioner, 875 F.2d 420, 423 (4th Cir. 1989),
affg. 90 T.C. 206 (1988), and Grojean v. Commissioner, 248 F.3d
572, 576 (7th Cir. 2001), affg. T.C. Memo. 1999-425). Here,
inasmuch as Mr. Tschetter farmed the homestead as a tenant, and
not as an employee of Wolf Creek Farm, the food and lodging in
question were not furnished to Mr. Tschetter as a corporate
Page: Previous 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 NextLast modified: May 25, 2011