This is a petition to review, pursuant to section 7482 of the Internal Revenue Code of 1954, a decision by the Tax Court that moving expenses paid by the respondents, Vaal R. Dodd and Carolyn Dodd, were properly deducted on their 1963 joint income tax return as an 'ordinary and necessary' business expense pursuant to section 162 of the Code.1 We reverse.

Dodd was employed as a machinist at Standard Oil Company's refinery in El Segundo, California. On March 1, 1963, he was offered employment in the same capacity at Standard's refinery in Pascagoula, Mississippi, but was informed by his employer that all costs in connection with relocating to Pascagoula would be at his own expense except that he would be allowed up to five days' personal leave with pay for time required in travelling to Pascagoula. Standard was then making an effort to recruit employees for the refinery in Pascagoula.2 Dodd discussed the Pascagoula offer with his supervisor and was advised to accept the offer because the El Segundo refinery was going to be automated and this would bring about a cutback in the manpower necessary for its operation. Believing that his job would be in jeopardy if he rejected the Pascagoula offer Dodd accepted it and the Dodds moved to Pascagoula.

On their 1963 joint income tax return, the Dodds claimed a deduction in the amount of $579.00 for the expenses they incurred in moving from El Segundo, California, to Pascagoula, Mississippi. The Commissioner of Internal Revenue disallowed the claimed deduction and served the Dodds with a notice of deficiency in the amount of $115.80 for the year 1963. The Dodds filed a petition for redetermination of the deficiency in the Tax Court and prevailed. The Commissioner appealed.

The narrow question that we are called upon to decide is whether an employee may deduct unreimbursed moving expenses incurred in 1963. While the Commissioner concedes that the amount deducted by the taxpayers was reasonable, he contends that unreimbursed moving expenses incurred prior to January 1, 1964, are non-deductible 'personal, living or family expenses' pursuant to section 262 of the Internal Revenue Code of 1954.3 We agree.

Congress has delegated to the Commissioner the responsibility of Making rules and regulations necessary to effectuate and enforce the tax laws.4 Modification or change of these rules and regulations must be made by the Congress and the Commissioner, not by the Courts. United States v. Correll, 389 U.S. 299, 88 S. Ct. 445, 19 L. Ed. 2d 537 (1967). Prior to January 1, 1964, the Commissioner interpreted the Code to draw a distinction between reimbursed and unreimbursed moving expenses.5 The Revenue Act of 1964 added section 217 to the Code, 26 U.S.C.A. 217, which eliminated the distinction previously drawn between reimbursed and unreimbursed moving expenses.6 The effect of this section was to permit employees to deduct unreimbursed moving expenses from their gross income, but this was expressly limited to expenses incurred after December 31, 1963.7 Therefore the taxpayers' moving expenses are not deductible either as ordinary and necessary business expenses pursuant to section 162(a) or as travel expenses while away from home pursuant to section 162(a) (2). These expenses are non-deductible personal, living or family expenses pursuant to section 262. Commissioner of Internal Revenue v. Mendel, 4 Cir. 1965, 351 F.2d 580.

The taxpayers contend that in the circumstances of this case unreimbursed moving expenses should be deductible the same as educational expenses of an employee necessary to hold his job, or treated the same as those instances in which the value of meals and lodging are excluded from the employees' gross income because the employee is required to accept meals and lodging as a condition of his employment.8 We disagree.

All economic and financial benefits received by an employee as compensation from whatever source derived constitute gross income pursuant to section 61(a) of the Code. Deductions, however, are matters of legislative grace. They are allowable only when they are made deductible by statute. McDonald v. Commissioner of Internal Revenue, 323 U.S. 57, 65 S. Ct. 96, 89 L. Ed. 68; Ritter v. United States, Ct.Cl. 1968, 393 F.2d 823, 183 Ct. Cl. 875; Commissioner of Internal Revenue v. Mendel, supra; United States v. Woodall, 10 Cir. 1958, 255 F.2d 370. The instances that the taxpayer seeks to analogize to this case are specifically made deductible or exempt by the Code and Treasury Regulations.9 The deduction of unreimbursed moving expenses provided for in the Revenue Act of 1964, was, however, expressly made prospective only and is unavailable to taxpayers.

The taxpayers argue that it is unfair and inequitable to allow deduction of unreimbursed moving expenses incurred after 1963 but to deny those incurred during or before 1963. The answer is that the tax law is statutory and equitable considerations are inapplicable. Estate of Dupree v. United States, 5 Cir. 1968, 391 F.2d 753; Carlton v. United States, 5 Cir. 1967,385 F.2d 238. In any event, it would be no less unfair and inequitable to grant the taxpayers a special benefit not available to other taxpayers who incurred unreimbursed moving expenses prior to or during 1963.

We admire the persuasiveness and perseverance of the taxpayers pro se. They presented their case in the Tax Court and here with an advocate's zeal. We are, nevertheless, convinced that the judgment below must be reversed.

Reversed.