Jackson v. Commissioner
United States Tax Court
P, a former insurance agent for State Farm Insurance Companies, received termination payments after his retirement on December 31, 1987, pursuant to the terms of an independent contractor Agent's Agreement.
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P, a former insurance agent for State Farm Insurance Companies, received termination payments after his retirement on December 31, 1987, pursuant to the terms of an independent contractor Agent's Agreement. Held, the termination payments P received were not "derived" from a trade or business carried on by him as an insurance agent during 1990 and 1991. Therefore, such payments are not subject to self-employment tax under sections 1401 and 1402, I.R.C., and P is not liable for such tax. Milligan v. Commissioner, 38 F.3d 1094 (9th Cir. 1994), revg. T.C. Memo. 1992-655, followed.
1Opinion of the Court
OPINION
Dawson, Judge:
Respondent determined deficiencies in petitioners’ Federal income taxes for the taxable years 1990 and 1991 in the amounts of $2,837 and $2,837.48, respectively.
At issue is whether termination payments received by William R. Jackson, a former independent agent for State Farm Insurance Cos., are subject to self-employment tax pursuant to sections 1401 and 1402.1
This case was submitted fully stipulated under Rule 122. The stipulation of facts and the attached exhibits are incorporated herein by this reference. The pertinent facts are summarized below.
Petitioners resided in…
2Cases cited12 opinions
- Jack E. Golsen and Sylvia H. Golsen v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1971
- Nationwide Mutual Insurance v. DardenSupreme Court of the United States · 1992
- Arizona Governing Committee for Tax Deferred Annuity & Deferred Compensation Plans v. NorrisSupreme Court of the United States · 1983
- Simpson v. CommissionerUnited States Tax Court · 1975
- Newberry v. CommissionerUnited States Tax Court · 1981
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