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Respondent determined for 2003 a deficiency in petitioners’
Federal income tax of $4,271. After a concession by
petitioners,1 the sole issue for decision is whether certain
payments received by Claudette B. Stulz (petitioner) are military
allowances excludable from petitioners’ gross income.
Background
The stipulation of facts and the exhibits received into
evidence are incorporated herein by reference. At the time the
petition in this case was filed, petitioners resided in
Jacobstown, New Jersey.
During 2003 petitioner was retired from the U.S. military
and was not on active duty. She was, however, employed as a
Junior Reserve Officers’ Training Corps (JROTC) instructor for
the Township of Winslow Board of Education (Township). She
performed her JROTC instruction at Winslow Township High School
located at 10 Coopers Folly Road, Atco, New Jersey.
The Township issued to petitioner a Form W-2, Wage and Tax
Statement, reporting wages of $43,466.24. Petitioners failed to
report on their joint Federal income tax return $16,965 of
petitioner’s Township wages under the belief that a portion of
the JROTC instructor wages is nontaxable. The statutory notice
of deficiency issued by respondent determined that all of the
1Petitioners agree that additional pension and annuity
income of $108 must be included in income for 2003.
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Last modified: November 10, 2007