James E. Anderson and Cheryl J. Latos - Page 36

                                       - 36 -                                         
          the regulation.  Because the preamble, the regulation, and the              
          example specify the effects of “solely” on additional                       
          remuneration paid to crew members, the effect of “solely” on                
          other factors, including subtraction of operating expenses, is              
          properly excluded.                                                          
               The stipulation of facts, including the schedules computing            
          the proceeds earned by petitioner and the other crew members from           
          each of the voyages of the Elizabeth R., indicates that the crew            
          members’ share was charged for operating expenses at three                  
          different levels.  For every voyage, the proceeds subject to                
          allocation between the crew members and the fishing boat owner              
          and captain were reduced by two or three of fuel, ice, and                  
          lubricating oil.  For every voyage, the crew members’ 50-percent            
          share was reduced by one or more of payments to lumpers and for             
          food, and on one occasion for “miscellaneous”.  For four voyages,           
          petitioner’s individual crew member’s share was charged for                 
          “clothing”, and for one voyage, he was charged for unspecified              
          “supplies”.                                                                 
               In our view, each of these types of charges, at whatever               
          level incurred and subtracted, does not change the character of             
          the share of proceeds that petitioner received as depending                 
          “solely” on the amount of the boat’s catch of fish within the               
          meaning of section 3121(b)(20) and section 31.3121(b)(20)-                  
          1(a)(2), Employment Tax Regs.  Notwithstanding that none of these           






Page:  Previous  26  27  28  29  30  31  32  33  34  35  36  37  38  39  40  41  42  43  44  45  Next

Last modified: May 25, 2011