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(1) appointed in the civil service by one of the
following acting in an official capacity--
(A) the President;
(B) a Member or Members of Congress, or the
Congress;
(C) a member of a uniformed service;
(D) an individual who is an employee under
this section;
(E) the head of a Government controlled
corporation; or
(F) an adjutant general designated by the Secretary
concerned under section 709(c) of title 32.
Pavich was certainly not “appointed in the civil service.”
The Commissioner’s argument--that Pavich is Raytheon’s, and only
Raytheon’s, “employee” at common law--is strong, but not without
doubt: An individual may have more than one employer at the same
time. “A person may be the servant of two masters * * * at one
time as to one act, if the service to one does not involve
abandonment of the service to the other.” 2 Restatement, Agency
2d, sec. 226 (1958). And previous cases decided under section
912(2) seem to have all involved taxpayers who had no connection
with the Federal Government, rather than the sort of dual control
Pavich credibly testified he was subject to. See, e.g.,
Grauvogel v. Commissioner, 768 F.2d 1087, 1089 (9th Cir. 1985)
(Alaska State Department of Fish and Game biologist), affg. T.C.
Memo. 1984-124.
But we don’t need to dive into this murk. As the
Commissioner also argues, section 912(2) requires an exempt cost-
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Last modified: May 25, 2011