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Consequently, we conclude that payments petitioner received with
respect to his employment as a JROTC instructor constitute
compensation for services rendered to the school district.
Petitioner’s status as a member or former member of the Armed
Forces therefore has no effect on the inclusion of such payments
in gross income.
As stated in Lyle v. Commissioner, supra at 674: “we think
that Congress never intended to pay any nontaxable ‘allowances’
to retired officers serving as Junior ROTC instructors.” The
provisions of 10 U.S.C. sec. 2031(d)(1) do not authorize the
Federal Government to pay nontaxable allowances to retired
military personnel serving as JROTC instructors but merely
provide a formula for computing the minimum “additional amount”
of compensation that such retired instructors may receive from
the employing school and the maximum portion of such an
additional amount that will be reimbursed by the Federal
Government. Lyle v. Commissioner, supra at 675. Consequently,
monthly statements petitioner received from the school district
itemizing allowances represented the amount of reimbursement
available to the school district from the Federal Government
pursuant to 10 U.S.C. sec. 2031(d)(1) rather than actual
allowances excludable from petitioners’ gross income.
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