32 T.C. 334">*334 Respondent determined a deficiency in income tax for the taxable year 1953 in the amount of $ 579.30. The issue for decision is whether various expenses of the petitioner are deductible as traveling expenses while away from home within the meaning of section 23(a)(1)(A)1959 U.S. Tax Ct. LEXIS 172">*174 of the 1939 Code.

FINDINGS OF FACT.

During 1953 the petitioners were residents of Lancaster, California. They filed a joint return with the director of internal revenue for the sixth district of California in Los Angeles.

Since the question to be decided relates only to Darrell Courtney, he is referred to hereinafter as the petitioner.

The petitioner was employed by North American Aviation, Inc., from October 1951 until sometime in 1956. He was employed at the main plant, in its accounting department, in Downey, California, until July 1952.

32 T.C. 334">*335 In 1952, petitioner was about 28 years old; he was married and had one child. In 1953, a second child was born. Petitioner is a high school graduate and he attended a business college, where he studied accounting, for 2 years.

North American Aviation, Inc. (hereinafter called North American) has a main plant and offices in Downey, California. The town of Downey is located near Los Angeles; it is about 6 miles from Long Beach; and it is a considerable distance from Edwards Air Force Base which is located in the Mojave Desert in California.

In 1952 North American received a contract from the United States Air Force to do certain work1959 U.S. Tax Ct. LEXIS 172">*175 at Edwards Air Force Base in connection with the testing of guided missiles. The nature of the project was classified as secret for security purposes. Under the contract, North American was to use its own employees who were to be transferred to Edwards Air Force Base. They received all payments for their work from North American. North American understood that the Air Force was constructing a permanent missile test station and range on the east coast of Florida, and that the work to be done by North American at Edwards Air Force Base would be continued at the missile test station in Florida after the Air Force Base there was completed. That base is now known as Cape Canaveral. North American's personnel which constituted its missile test organization at Edwards Air Force Base was moved to Cape Canaveral at sometime after March 1954. Under these circumstances, North American regarded the location of its offices at Edwards Air Force Base as temporary.

At sometime prior to July 1952 North American began organizing a group of its employees at its Downey plant to go to Edwards Air Force Base. Petitioner was asked whether he would be willing to go to the Edwards Base. He accepted1959 U.S. Tax Ct. LEXIS 172">*176 the offer because he would be given a promotion and an increase in salary. In July 1952 petitioner, as an employee of North American, was transferred to Edwards Air Force Base along with many others. Petitioner was employed continuously at Edwards Air Force Base from July 1952 to March or April 1954 when he was transferred to Cape Canaveral, Florida. He worked at the Downey plant, however, between March or April and July before going to Florida, during which time he lived with his family in a furnished apartment in Downey, having put his furniture in storage in Lancaster until it was shipped by North American to Florida. He was employed by North American at Cape Canaveral for about 10 months, until May 1955, when he was transferred back to the North American plant at Downey, where he worked for about a year and a half, until he resigned from his position with North American for the purpose of obtaining other employment.

The employees of North American who were transferred to Edwards Air Force Base worked under a base manager and a division 32 T.C. 334">*336 chief, both being employees of North American. Petitioner's division chief was G. J. Raushbach. The nature of petitioner's work1959 U.S. Tax Ct. LEXIS 172">*177 was, in general, office work which included the maintenance of records and estimates of the number of hours required to complete various engineering functions.

Petitioner's regular working hours were from 7 a.m. to 3 p.m. He frequently was called upon to work overtime. Overtime work often lasted through the night. During such periods of overtime work it was necessary for petitioner to purchase breakfasts and dinners at the base, as well as lunches.

At the time petitioner was asked whether he would go with a group of employees to Edwards Air Force Base, he was not told that his employment there would be for any specified period of time, but it was petitioner's understanding that the North American project at Edwards Air Force Base might continue for at least 1 year. However, he was not told that he would be there for 1 year. Petitioner and the other members of the group were advised that the organization of North American at Edwards Air Force Base would be a temporary facility which would do initial tests and that the work under North American's contract would be continued at the Patrick Air Force Base in Florida where the final tests would be made.

North American did not pay the1959 U.S. Tax Ct. LEXIS 172">*178 moving expenses, as such, of any of its employees who decided to move to some town near Edwards Air Force Base. One of the towns near Edwards Air Force Base is Lancaster which is located about 35 miles from the base in the Mojave Desert.

There were facilities in officers' barracks at the base where employees of North American could live for a charge of $ 1 per day. Also, they could purchase their meals at the base.

North American paid employees assigned to Edwards Air Force Base a weekly allowance, in addition to wages, to cover the employee's additional expenses for food, lodging, and other necessities the cost of which was over and above the cost at or near Downey.

When North American moved its project and personnel from Edwards to Florida, it paid the costs of moving the household goods and furniture of an employee to Florida and from Florida back to California. When petitioner was transferred to Cape Canaveral in July 1954, North American arranged for shipping his household goods from Lancaster, California, to Cape Canaveral, and paid the cost thereof. Also, North American paid the expense of shipping his household goods back to Downey, California, in May 1955.

When petitioner1959 U.S. Tax Ct. LEXIS 172">*179 began his work at Edwards Air Force Base in July 1952 he did not move his family from Long Beach. During the last 6 months of 1952, petitioner, at first, lived during the week at Edwards Air Force Base; later he lived in a trailer in Lancaster. He 32 T.C. 334">*337 paid $ 28 a month for the use of parking space near a house. Petitioner went to his apartment in Long Beach over weekends. Under these arrangements in 1952, petitioner went to restaurants, or to the facilities at the base, for his meals during the week. Petitioner owned an automobile which he used for transportation between the base and Lancaster, and between Lancaster and Long Beach. The round trip from Lancaster to the base was 70 miles.

In December 1952 petitioner decided to move his family to Lancaster where he rented a small house for $ 89.50 per month. As his rent in Long Beach had been $ 60 per month, an increase in rent of $ 29.50 per month was involved. Petitioner was required to sign a 1-year lease for the house in Lancaster, but there was a clause in the lease which provided that if he should be transferred away from Edwards Air Force Base the lease would end at such time without further charges. Petitioner 1959 U.S. Tax Ct. LEXIS 172">*180 and his family moved into the house in Lancaster on or about December 24, 1952, and they lived there until around March 1954 when petitioner was transferred to Florida.

Other employees of North American moved to Lancaster, or to some other town near Edwards Air Force Base.

During 1953, petitioner received each week from North American, in addition to his wages, an additional check, an allowance to cover his increased living expenses, in the amount of about $ 47. During 1953, the total amount of petitioner's wages was $ 5,923.32, the total amount of the increased living expense allowance was $ 2,443, and the total amount received from North American was $ 8,366.32.

Petitioner was not required by North American to submit any expense account showing his use of his living expense allowance, and he did not do so. North American did not place any restriction of any kind upon the use of the living expense allowance; petitioner could spend it as he wished.

In his income tax return for 1953, in line 2, petitioner reported both the total amount of his wages and the total amount of the living expense allowance. He deducted, in line 2, $ 2,443 as "living expenses away from home." Petitioner1959 U.S. Tax Ct. LEXIS 172">*181 did not itemize in his return his expenditure of the allowance of $ 2,443.

At sometime in 1956 petitioner's return for 1953 was examined by agents of the respondent who questioned the deduction of $ 2,443 for "living expenses away from home." Petitioner then obtained from North American a letter dated December 13, 1956, signed by W. S. Gudmundson, Manager, Engineering Personnel, Missile and Control Equipment Operations. The letter is incorporated herein by this reference. It is addressed, "To Whom it may Concern." The subject of the letter is, "Per Diem Allowance of Mr. Darrell S. Courtney." It is stated in the letter, among other things, as follows:

32 T.C. 334">*338 Each employee so assigned at Edwards Air Force Base was paid a per diem allowance for the period of his absence from the home plant. This allowance was intended to cover the employee's expenses (food, lodging, etc.) over and above the normal expenses he would incur while working at the home plant.

The respondent disallowed deduction of $ 2,443 for the following reason:

The amount of $ 2,443.00 deducted from salary income reported in your income tax return, as representing "away from home" expense, is disallowed due to lack1959 U.S. Tax Ct. LEXIS 172">*182 of substantiation that you were away from home within the meaning of section 23(a)(1) of the Internal Revenue Code of 1939.

In the petition filed in this Court, the petitioner included a schedule showing the amounts of his claimed increased expenses. Such expenses total $ 2,433, rather than $ 2,443. The expenses for which petitioner claims deductions are $ 70 for moving; $ 250 for depreciation and cleaning of household goods and personal belongings; $ 360 for additional rent; $ 274 for increased charges for water, gas, and electricity; $ 959 for additional mileage costs of driving to work from his residence, and return; and $ 520 for breakfasts and dinners at work (but not for lunches), which expense resulted from overtime work and irregular hours of work at Edwards Air Force Base. Petitioner's computation of the expenses for which deductions are claimed is as follows:

1959 U.S. Tax Ct. LEXIS 172">*183 32 T.C. 334">*339 Petitioner was transferred in July 1952 to Edwards Air Force Base from Downey for an indefinite and indeterminate period. Edwards Air Force Base was petitioner's main post of duty or principal place of business beginning in July 1952, during all of 1953, and until March 1954 when he was transferred to Florida but returned to Downey for a few months prior to going to Florida.

Petitioner's expenses in the total amount of $ 2,443 were nondeductible personal expenses; they were not traveling expenses incurred and paid while traveling away from home in the pursuit of his employer's business.

North American's allowance in 1953 to petitioner of about $ 47 per week, or $ 2,443, was in the nature of a bonus which was made as additional compensation for services to induce petitioner to accept employment at its place of operations at Edwards Base. Such allowance was intended to cover petitioner's additional living expenses; it was not reimbursement for traveling expenses while away from home in pursuit of North American's business.

OPINION.

In his income tax return for 1953, Form 1040, line 2, petitioner reported as "per diem" the receipt of $ 2,443, and he subtracted the same amount1959 U.S. Tax Ct. LEXIS 172">*184 as "living expenses away from home." The respondent's determination disallowing the deduction was made under section 23(a)(1)(A) of the 1939 Code. The petitioner does not refer to any particular statutory provision in support of his claim for 32 T.C. 334">*340 deduction, but it is understood that the issue arises under the provisions of section 23(a)(1)(A). ¹

In his petition, petitioner itemized expenses of $ 2,433. There is no explanation of the discrepancy in the amount1959 U.S. Tax Ct. LEXIS 172">*185 of $ 10.

Petitioner did not file a brief and he has not otherwise cited any authorities in support of his claim for a deduction, but he relies largely upon the letter of Gudmundson, ² as well as upon his own testimony. It is understood from both that it is petitioner's contention that his employment at Edwards Air Force Base was "temporary" and that, therefore, he incurred expenses while away from home which he is entitled to deduct under section 23(a)(1)(A). It appears that petitioner relies on Harry F. Schurer, 3 T.C. 544">3 T.C. 544, but the Schurer case was decided before Commissioner v. Flowers, 326 U.S. 465">326 U.S. 465, and Puerifoy v. Commissioner, 358 U.S. 59">358 U.S. 59, which control.

1959 U.S. Tax Ct. LEXIS 172">*186 The respondent contends that the expenses in question were not incurred "while away from home in the pursuit of a trade or business" within the meaning of section 23(a)(1)(A); that petitioner's tax "home" during 1953 was Edwards Air Force Base, not Downey; and that the expenses in question were not incurred in pursuit of the business of his employer but were nondeductible personal expenses. Respondent relies chiefly upon 326 U.S. 465">Commissioner v. Flowers, supra.

Before considering the various items for which deductions are claimed, it is advisable first to consider the nature of the allowance petitioner received from his employer. The cash allowance of about $ 47 per week, in addition to salary, was "intended to cover the employee's expenses (food, lodging, etc.) over and above the normal expenses he would incur while working at the home plant." Such allowance totaled $ 2,443 during 1953. The allowance was paid because it was understood that petitioner's living expenses in the vicinity of the Edwards Base would be greater than they would have been if he had continued to work at and live near Downey.

32 T.C. 334">*341 A cash allowance for food, lodging, and similar1959 U.S. Tax Ct. LEXIS 172">*187 items, in addition to wages, is income within the scope of section 22(a). See Gunnar Van Rosen, 17 T.C. 834">17 T.C. 834, involving a cash allowance in lieu of subsistence and quarters paid to a civilian employee of the Army Transportation Corps. In Charles H. Hyslope, 21 T.C. 131">21 T.C. 131, it was held that an allowance paid to a State police trooper, in addition to his salary, as reimbursement for various expenses which he incurred, was income within section 22(a). In this case, there can be no doubt that the cash allowance of $ 2,443 is gross income under section 22(a). The additional allowance was a bonus which was paid as additional compensation for services to induce petitioner to accept a transfer of the location of his employment to a place where his living expenses would be higher.

It is the general scheme of the income tax statute that a taxpayer is required by the provisions of section 22(a) to include in gross income all gains and profits, all compensation for personal services of whatever kind and in whatever form paid, and income derived from any source whatever. Section 22(b) specifies the items to be excluded from gross income1959 U.S. Tax Ct. LEXIS 172">*188 which otherwise would fall within the broad scope of section 22(a). (Section 22(b) is not involved here.) Section 24 sets forth items which are not deductible. Section 24(a)(1) provides that no deduction shall be allowed for personal, living, or family expenses. Section 23(a)(1)(A), however, allows deduction of "the entire amount expended for meals and lodging," along with the expense of travel, if such expenses are trade or business expenses paid or incurred for travel "while away from home in the pursuit of a trade or business." Since the expense of food and lodging ordinarily is living expense, the above provision in section 23(a)(1)(A) represents an exception to section 24(a)(1), provided the conditions set forth are met. The general rule is that since deductions are a matter of legislative grace there must be compliance with the conditions in the statute which are made the basis for an allowable deduction, and the statutory provisions which permit deductions must be strictly construed.

Three conditions must be satisfied in order to receive a deduction under section 23(a)(1)(A) for the expenses of meals, lodging, and transportation, and if any one of the three conditions1959 U.S. Tax Ct. LEXIS 172">*189 is not satisfied the expense is personal and nondeductible. The three conditions are as follows: (1) The food, lodging, and transportation expense must be business traveling expense which is reasonable and necessary. (2) There must be a direct connection between the food, lodging, and transportation expense and the carrying on of the employer's business (or the taxpayer's business); and there must be pursuit of the employer's business which necessitates the employee's incurring the 32 T.C. 334">*342 expenses for food, lodging, and transportation. (3) Such expense must be incurred while traveling away from home. 326 U.S. 465">Commissioner v. Flowers, supra."Home" as used in the statute has been construed to mean the taxpayer's principal place of employment or business, and the job must require the traveling expenses. Carragan v. Commissioner, 197 F.2d 246, 249; O'Toole v. Commissioner, 243 F.2d 302, 303. It was said, in substance, in the Flowers case, supra, that in order to come within the provisions of section 23(a)(1)(A) the expenses for which a taxpayer seeks a deduction must have1959 U.S. Tax Ct. LEXIS 172">*190 been incurred in connection with business trips and "[business] trips are to be identified in relation to business demands and the traveler's business headquarters. The exigencies of business rather than the * * * necessities of the traveler must be the motivating force."

Consideration of the entire record leads to the conclusion that the three conditions in the statute are not met. The situation was, in simple terms, as follows: North American, under a contract with the Air Force, undertook a new project for the Air Force which required the performances of services at Edwards Air Force Base by personnel employed by North American. When North American undertook to recruit personnel for the new work it was understood that the place of employment would be at Edwards Base. As far as we are informed, it is clear that none of the work was to be done at North American's plant at Downey, at least, as far as petitioner was concerned. When petitioner accepted assignment to the project he assumed new duties, he entered upon different work, his principal place of employment was changed from Downey to Edwards Base, and petitioner did not continue to have a place of employment in Downey. 1959 U.S. Tax Ct. LEXIS 172">*191 Petitioner's new job at Edwards Base did not involve his traveling for North American on any business trips; petitioner's duties were carried out by him at Edwards Base. In short, petitioner, in 1952, was transferred to a new post of duty where he remained until about March 1954. Under these facts and circumstances it is concluded that none of the expenses involved were incurred while away from petitioner's principal place of employment; there was no direct connection between any of the expenses and the carrying on of North American's business; and the pursuit of North American's business did not necessitate any of the expenses at issue.

It is immaterial that North American understood that the work under its contract which was commenced and carried on at Edwards Base would not be completed there but would be continued at another missile testing base in Florida when the Air Force was ready to move its missile testing project there. Apparently North American's work under the contract involved a continuing service throughout at the situs of the basic work being done by the Air Force. Although an 32 T.C. 334">*343 eventual change in the situs of the activities of the Air Force was contemplated1959 U.S. Tax Ct. LEXIS 172">*192 when the contract was awarded in 1952, there was not an understanding in 1952 with North American that North American's services at the Edwards Base would be terminated after the expiration of a definite period, or would be of such short duration as to constitute North American's working quarters at Edwards Base a transient location of its operations, even though it was not permanent. Many of North American's task force moved to the vicinity of Edwards Base. Their work there, including petitioner's work, was not transitory. Petitioner was not in a travel status during 1952 and 1953. When, in 1954, the project was moved to Florida, petitioner and his coworkers were, in fact, assigned to a new post of duty.

Under all of the circumstances, Gudmundson's characterization of North American's work at Edwards Base as "temporary" is of no significance. In Henry C. Warren, 13 T.C. 205">13 T.C. 205, we regarded as immaterial an employer's classification of the taxpayer's job as "temporary" where the evidence showed that the taxpayer acquired a post of duty where he accepted employment. See, also, the following cases where it was held that although a job site was not permanent, 1959 U.S. Tax Ct. LEXIS 172">*193 it was the taxpayer's principal place of employment and post of duty and expenses of meals, lodging, and transportation were not "traveling" expenses under section 23(a)(1)(A): York v. Commissioner, 160 F.2d 385; Ney v. United States, 171 F.2d 449, certiorari denied 336 U.S. 967">336 U.S. 967; Andrews v. Commissioner, 179 F.2d 502; Ford v. Commissioner, 227 F.2d 297; William W. Todd, 10 T.C. 655">10 T.C. 655; Robert F. Green, 12 T.C. 656">12 T.C. 656; Beatrice H. Albert, 13 T.C. 129">13 T.C. 129; Willard S. Jones, 13 T.C. 880">13 T.C. 880; Michael J. Carroll, 20 T.C. 382">20 T.C. 382; James R. Whitaker, 24 T.C. 750">24 T.C. 750. This case is indistinguishable from the above cases.

Petitioner's employer paid him an allowance of about $ 47 per week which was intended to cover the differential between lower living costs at Long Beach and higher costs in the vicinity of Edwards Base. This was not a per diem to cover traveling1959 U.S. Tax Ct. LEXIS 172">*194 expenses as that term is ordinarily understood. The fact that a taxpayer receives an allowance from his employer to cover additional living expenses does not in and of itself serve to bring the expenses covered by such allowance within section 23(a)(1)(A), and no other statutory provision is involved here under which such allowance can be considered. An allowance which is paid in addition to the employee's regular wages, or basic salary, may be nothing more than extra compensation for services which the employer pays out of consideration for extra personal expenses which the employee must incur because of the conditions under which he must carry on his duties at his post of duty and place of employment. An employer often reimburses an employee for expenses which clearly are the traveling expenses contemplated by section 32 T.C. 334">*344 23(a)(1)(A), but all reimbursed expenses are not traveling expenses within the provisions of the statute, particularly where the expense is unnecessary and inappropriate to the conduct of the employer's business and has no direct relation to the exigencies of that business. Thus, in 21 T.C. 131">Charles H. Hyslope, supra, the taxpayer1959 U.S. Tax Ct. LEXIS 172">*195 was required to prove whether all or part of an allowance satisfied the conditions prescribed in section 23(a)(1)(A) and it was held that certain expenses which were covered by the allowance were nondeductible personal expenses. See, also, Barnhill v. Commissioner, 148 F.2d 913, where the taxpayer received an allowance of $ 1,550 per year in addition to salary to cover certain living and transportation expenses but deduction for the reimbursed expenses was disallowed because the conditions contained in the statute were not satisfied. In 20 T.C. 382">Michael J. Carroll, supra, the taxpayer was a civilian employee of the War Department who was assigned to a post of duty in Seoul, Korea. He received a basic, annual salary, and, in addition, a 25 per cent overseas differential which amounted to $ 1,476 during the taxable year. He claimed a deduction, as traveling expenses while away from home, for certain living expenses incurred at his post of duty, but since his place of employment was at Seoul, deduction under section 23(a) (1) (A) was disallowed. We rejected the contention that his employment in Korea was "temporary." This1959 U.S. Tax Ct. LEXIS 172">*196 case is not distinguishable from the Carroll case.

Since the expenses in question were incurred by petitioner at his post of duty and principal place of employment, they are not deductible under section 23(a)(1)(A).

Consideration is given to whether any one of the items of expense is deductible under all of the circumstances for any special reasons.

At the end of 1952, petitioner moved his family residence to Lancaster which appears to have been the town closest to Edwards Base where he could rent living quarters for himself and his family. Lancaster is 35 miles from the base and petitioner made a round trip by car of 70 miles per day between his residence and his place of employment. The cost of mileage was in the nature of commuting expense. Commuting expenses have never been allowed as a deduction. Regs. 118, sec. 39.23(a)-2(i); Frank H. Sullivan, 1 B.T.A. 93">1 B.T.A. 93. This rule must be followed regardless of the distance between the place of abode and the place of employment, Barnhill v. Commissioner, supra;13 T.C. 129">Beatrice H. Albert, supra;326 U.S. 465">Commissioner v. Flowers, supra;1959 U.S. Tax Ct. LEXIS 172">*197 or of any equitable consideration, John C. Bruton, 9 T.C. 882">9 T.C. 882. Deduction of $ 959 for mileage expense is not allowable.

Petitioner claims a deduction of $ 520 for meals other than lunch which he purchased at Edwards Base when he worked overtime. It is a well established rule that expenses for meals while at work, or 32 T.C. 334">*345 en route to or from work, are personal expenses and are not deductible under section 23(a)(1)(A). Louis Drill, 8 T.C. 902">8 T.C. 902; Fred Marion Osteen, 14 T.C. 1261">14 T.C. 1261; Sam J. Herrin, 28 T.C. 1303">28 T.C. 1303; O'Toole v. Commissioner, supra.Deduction for meals in the amount of $ 520 is not allowable.

Petitioner's expense of moving to Lancaster was not paid by North American. It amounted to $ 70, or more. The deduction is not allowable; it is not allowable under section 23(a)(1)(A) or (2). The expense was a personal expense. York v. Commissioner, supra;Bercaw v. Commissioner, 165 F.2d 521; George B. Lester, 19 B.T.A. 549">19 B.T.A. 549; H. Willis Nichols, Jr., 13 T.C. 916">13 T.C. 916.1959 U.S. Tax Ct. LEXIS 172">*198 In the Nichols case, deduction for moving expense was disallowed an Army officer who moved his household goods from one post of duty to a new post. It was noted that such expense was not related to the performance of his work and duties.

Petitioner claims' a deduction of $ 250 for alleged depreciation of his household goods and personal belongings which he contends resulted from moving them to Lancaster. If the alleged depreciation is regarded as part of petitioner's moving expense, it is not deductible under the cases cited above. A deduction for depreciation of personal belongings, the furniture and furnishings used in a taxpayer's residence, and other property devoted exclusively to personal use is not authorized by section 23(l). Bradley v. Commissioner, 184 F.2d 860. The deduction is denied.

Petitioner claims deductions of $ 360 for rent and $ 274 for utilities, which amounts represent the increases above what he would have paid in Long Beach if he had not moved to Lancaster. These expenses are living and family expenses deduction of which is expressly denied by section 24(a)(1). A taxpayer's living expenses while he is carrying on1959 U.S. Tax Ct. LEXIS 172">*199 his work at his post of duty and place of employment are personal and are not deductible business expenses under section 23(a)(1)(A). York v. Commissioner, supra;20 T.C. 382">Michael J. Carroll, supra.The deductions are denied.

All of the expenses at issue are nondeductible personal expenses; none of them come within section 23(a)(1)(A). The respondent's determination is sustained.

Decision will be entered for the respondent.