## Facts

- Richard R. Sibla and Robert E. Cooper were firefighters for the Los Angeles Fire Department assigned to the same station and working 24-hour shifts.
- While on duty, they were not permitted to leave the station for personal business.
- The department required all firefighters at each station (unless officially excused for a verified physical ailment) to participate in a nonexclusionary organized “mess” at the station.
- Firefighters, not the department, organized and financed the mess by purchasing and preparing food and assessing members for the cost of meals; the department provided kitchen facilities.
- The assessments averaged about $3 per firefighter per 24-hour shift and were required even when a firefighter was away from the station on department business during the meal period.
- Sibla and Cooper deducted their mess payments as ordinary and necessary business expenses under I.R.C. § 162(a).
- The Commissioner disallowed the deductions as personal living expenses under I.R.C. § 262; the Tax Court ruled for the taxpayers.

## Issues

1. Whether mandatory firehouse mess assessments, equal to the value of the meals and required as a condition of employment, are nondeductible personal living expenses under I.R.C. § 262 or deductible business expenses under I.R.C. § 162(a).
2. Whether the meals should instead be treated as employer-furnished meals excludable from income under I.R.C. § 119.

## Decision

- The Ninth Circuit affirmed the Tax Court.
- The court held the mess assessments were not nondeductible living expenses under § 262.
- The court concluded the amounts were either deductible as ordinary and necessary business expenses under § 162(a) or treated as employer-furnished meals excludable under § 119.
- The court relied on the compulsory nature of participation and payment, the employer-related purpose of the mess requirement, and the fact that the charge equaled the value of the meals.

## Legal Principles

- Meal costs ordinarily treated as personal consumption may fall outside § 262 when the employee incurs them involuntarily as a condition of employment and they serve the employer’s business objectives.
- An expense can qualify as “ordinary and necessary” under § 162(a) when it is directly connected to employment requirements rather than personal choice.
- Where meals are effectively required for the employer’s convenience in the work setting, the arrangement may be analyzed under § 119 as employer-furnished meals, even if employees bear the direct cost through mandatory assessments.

## Conclusion

Mandatory firehouse mess assessments imposed as a condition of employment and tied to the employer’s operational and policy goals were not personal living expenses; the payments were properly treated for tax purposes as either deductible business expenses under § 162(a) or meals excludable under § 119.


Sibla v. Commissioner, 611 F.2d 1260 (9th Cir. 1980)