The Tax Court yesterday decided a case of great interest to law faculty.  Xiong v. Commissioner, T.C. Summ. Op. 2007-96 (6/14/07).  Jin Xiong, an assistant professor of biology at Texas A&M, signed a contract with Cambridge University Press in 2003 to write a book on bioinformatics — the analysis of information relating to biological structures with the aid of computers.  The book was published in 2006, and Prof. Xiong uses the book in his courses at Texas A&M.

Prof. Xiong claimed that book-writing was a trade or business separate from his trade or business as a professor and deducted the expenses of a home office.  He claimed, without any corroborating evidence, that he was not permitted to work on the book at his Texas A&M office.  In addition, Prof. Xiong deducted expenses of travel to libraries to do research for the book as well as expenses of driving from his home office to his Texas A&M office (including the cost of his daily linches at Texas A&M). The Tax Court denied the claimed deductions:

Petitioner has not convinced us that his book writing project is a separate activity rather than an outgrowth of his university teaching and research. While it may be true, as petitioner suggests, that university professors generally are not required to write books, it does not follow that a university professor who writes a book is engaged in a separate business activity. Petitioner’s book is in the same academic discipline as the one petitioner teaches at the university. Petitioner’s contract with Cambridge University Press clearly identifies petitioner as a university professor. Petitioner based his book, at least in part, on teaching notes he had developed over the years, and he used the book in teaching courses at the university. We find that petitioner’s book writing project is so interconnected with his university teaching and research as to not constitute an activity separate from that of his occupation as a university professor. …

Because he was a university professor, petitioner’s teaching and research functions at the university were of primary importance. Petitioner’s book writing project (which was performed at his home) was of secondary importance. Petitioner did not show that as a university professor he spent more time working at home than at the university. Accordingly, petitioner’s principal place of business as a university professor was the university. Moreover, we believe petitioner maintained an office in his home not for the convenience of the university, his employer, but rather for his own convenience.

In a footnote, the court stated:

Even were we to hold that petitioner’s book writing project was separate from his employment as a university professor, petitioner would still not be entitled to the claimed home office deduction because sec. 280A(c)(5) would limit the amount of the home office deduction to the amount of income produced from the book. The parties do not dispute that in 2003, the tax year in issue, petitioner had not yet written the book and therefore did not have any income from the book writing project.