Etter v. Department of Revenue

Summary

The Oregon Supreme Court affirmed the Oregon Tax Court’s judgment denying a Washington resident’s refund claim for Oregon income taxes. The court held that the federal air-carrier tax provision, 49 U.S.C. § 40116(f)(2), applies only to employees whose duties in multiple states are normal, typical, or routine, and that the taxpayer’s brief annual aircraft-observation flights did not qualify as regularly assigned duties. The court therefore concluded that the taxpayer was not exempt from Oregon taxation under the federal statute.

Holdings

1. The phrase regularly assigned duties requires duties that are normal, typical, or routine, not merely duties that occur at recurring intervals. An employee's occasional and incidental work in multiple states is insufficient unless the employee's regularly assigned duties require work in more than one state. Etter's approximately ten hours of required observation flights, constituting about 0.5 percent of his annual work hours, were not normal, typical, or routine duties; therefore, he did not qualify for the federal limitation on state taxation.
2. Summary judgment for the Department was proper because the stipulated facts presented no genuine issue of material fact and established as a matter of law that Etter did not meet the requirements of 49 U.S.C. § 40116(f)(2).

Questions Presented

1. Whether an aircraft dispatcher's federally required annual observation flights constituted regularly assigned duties on aircraft in at least two states under 49 U.S.C. § 40116(f)(2).
2. Whether the Oregon Tax Court properly granted summary judgment to the Department of Revenue on the stipulated facts.

Disposition

affirmed