Cheremnov v. Dept. of Rev.
TC-MD 230404R
| Or. T.C. | Aug 1, 2024Background
- Plaintiffs, Greg and Anfisa Cheremnov, are a married couple who spent part of 2019 in Alaska running a fishing business and the remainder in Canby, Oregon, where Greg worked for Complete Exteriors and Anfisa was a homemaker.
- The 2019 tax return included deductions for travel, per diem meal expenses, and mileage incurred for travel between Oregon and Alaska.
- The Oregon Department of Revenue (Defendant) issued a Notice of Assessment, disallowing these deductions on the grounds that Greg had two tax homes and Anfisa’s tax home was Alaska.
- Both parties moved for summary judgment based on undisputed facts and presented oral arguments.
- The key statutory reference is IRC § 162(a), governing deductions for business travel expenses, with the determination of the plaintiffs' "tax home" as the central legal issue.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Tax home location for 2019 | Both had one tax home: Canby, Oregon | Greg had two tax homes; Anfisa’s was Alaska | Both had tax home in Oregon |
| Deductibility of disputed expenses | Deductions valid as expenses were incurred while away from tax home | Deductions not allowed, as not away from respective tax homes | Deductions are allowed |
| Application of principal place of business test | Oregon qualifies by time and financial factors | Alaska (for fishing) is principal for Anfisa and part of Greg’s year | Oregon is principal tax home |
| Validity of alternative “domicile” analysis | Simple home = domicile would allow deductions either way | N/A | Same outcome under both interpretations |
Key Cases Cited
- Hammond v. Comm’r, 20 T.C. 285 (U.S. Tax Ct. 1953) (spouses may have separate tax homes; traveling expenses assessed per individual circumstance)
- Flowers v. Commissioner, 326 U.S. 465 (1946) (Supreme Court considered, but did not resolve, the meaning of "tax home"; focused on nexus between expense and business purpose)