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IN THE OREGON TAX COURT MAGISTRATE DIVISION Income Tax JAMES DEAN LUCAS SR, Plaintiff, v. DEPARTMENT OF REVENUE, State of Oregon, Defendant. ) ) ) ) ) ) ) ) ) )

TC-MD 100722B

DECISION

Plaintiff appeals the Notices of Deficiency Assessment issued by Defendant for the 2006, 2007, and 2008 tax years. A telephone trial was held in this matter on March 23, 2011. Plaintiff appeared and testified on his own behalf. Sharon J. Watson, Tax Auditor, appeared and testified on behalf of Defendant. As an exhibit, Plaintiff submitted a copy of OAR 150-316.127-(E). Defendant submitted Exhibit A, a photograph of Plaintiffs personal pickup truck. Both exhibits were received without objection. I. STATEMENT OF FACTS Plaintiff testified that he lives in Vancouver, Washington, and had lived there during the tax years at issue. During the tax years at issue, he worked for Allwest Underground Inc. (Allwest) at its Portland, Oregon branch location. Allwest has three branch locations: two in Washington and one in Oregon. (Ptfs Amended Compl at 5.1) The parties agree that Allwest Underground, Inc. qualifies as an interstate motor carrier under the Amtrak Act. Plaintiff testified that he drove two vehicles for Allwest: a personal pickup truck that he was required to purchase for his position that was "logoed" and had the yellow safety light set ///
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That is a letter dated October 21, 2009 from Stan Burwell (Burwell), Allwest Sales Manager.

DECISION TC-MD 100722B

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atop the truck; and an Isuzu flatbed owned by Allwest that meets Oregons criteria for a commercial vehicle but does not require a commercial driver license. Plaintiff testified that he used the Isuzu flatbed truck to deliver larger, heavier items. He testified that he occasionally filled in for one of the Isuzu truck drivers as need be. Plaintiff testified that he was assigned duties in both Oregon and Washington, including making deliveries and "haul[ing] equipment and products" to both Oregon and Washington. Defendant concedes that the Isuzu flatbed truck would qualify under the Amtrak Act, but maintains that delivery using a commercial motor vehicle was not one of Plaintiffs regularly assigned duties. Both parties testified concerning the letter from Burwell, dated October 21, 2009, stating that Plaintiff "traveled in the greater Portland and Southwest Washington area calling on customers to sell or rent them equipment, delivered sold or rented equipment, and performed other duties as required by the Portland Branch Manager." Plaintiff testified that Burwell is the manager for the Woodinville, Washington, branch of Allwest and that he visited the Portland branch "maybe a dozen times" in three years. Plaintiff testified that his "branch manager Ed" is the one who would give him assignments to deliver products to customers in Washington and Oregon. He testified that "Stan didnt know everything the Portland branch did." Watson testified that, based on the Burwell letter, it was clear to her that Allwest qualified under the Amtrak Act, but not that Plaintiff qualified. She testified that she contacted Burwell and spoke with him on November 19, 2009; during that conversation, Burwell confirmed that Plaintiffs job title was "outside sales" and that his duties were "to call on customers and get orders for equipment" and that "if he did any regular deliveries in the course of his visits to customers it was small items that would fit in the back of his pickup truck."

DECISION TC-MD 100722B

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Watson testified that Burwell stated "any equipment that was large enough to require delivery on the commercial vehicle was delivered by their * * * commercial driver licensed drivers." Watson testified that Burwell told her Plaintiffs work location had "three larger trucks, two that were over the gross vehicle weight rating for Washington that required a CDL [commercial driver license] driver and one that was just under the gross vehicle weight rating." Watson testified that Washington and Oregon have different gross vehicle weight rating requirements for CDLs. Washington drivers do not have to have a CDL until the vehicle is over 26,000 pounds. The smaller Isuzu flatbed truck was just under the 26,000 pound limit and could be driven by someone without a CDL. According to Watson, Burwell indicated that Plaintiff "may have on occasion" driven that truck only if the regular CDL driver was not available, but it was not part of his regular duties; Plaintiffs regular duties were as a salesperson for Allwest, using Plaintiffs own vehicle, for which he received a monthly allowance from Allwest. Plaintiff testified that he "ha[s] always delivered equipment, products, either rented or sold, to [his] customers in both states on a regular basis, just not in the Isuzu, in the commercial vehicle that [he] is allowed to drive." Plaintiff testified that "for gas and insurance purposes" it was more feasible for him to use his truck to deliver products and he was compensated for the use of his truck. He testified that he delivered items in the Isuzu flatbed truck 8 to 12 times per year. Watson stated that she "agree[s] that [Plaintiff] deliver[ed] parts and supplies back to his customers but he utilize[d] the pickup truck not the commercial motor vehicle." Watson testified that the vehicle that Plaintiff used on a regular basis, his personal pickup truck, "does not qualify as a commercial motor vehicle." /// ///

DECISION TC-MD 100722B

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II. ANALYSIS Nonresidents earning taxable income in Oregon are subject to taxation under ORS 316.037(3).2 The federal Amtrak Reauthorization and Improvement Act of 1990 (Amtrak Act) exempts certain nonresidents from Oregon income taxation. The Amtrak Act provides, in part: "No part of the compensation paid by a motor carrier providing transportation subject to jurisdiction under subchapter I of chapter 135 or by a motor private carrier to an employee who performs regularly assigned duties in 2 or more States as such an employee with respect to a motor vehicle shall be subject to the income tax laws of any State or subdivision of that State, other than the State or subdivision thereof of the employees residence." 49 USC

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