Television Wardrobe Maintained at HOME??? (1 of 3 related to clothing)

A pastor has special clothing or uniforms that are worn during television broadcasts. The church pays for the clothing or wardrobe and the pastor would like to keep the clothing at home instead of the television studio. Are these uniforms a legitimate expense of the church …and is it permissible to maintain the clothing at the pastor’s home?

The general rule is that the cost of clothing of an employee is deductible (and presumably can be provided tax-free by the employer) if both of the following tests are met:

...if the uniforms are specifically required as a condition of employment, and
...the uniforms aren't of a type adaptable to general or continued usage to the extent they take the place of regular clothing. Revenue Ruling 70-474, 1970-2 CB 34.

The Tax court (Yeomans v. Commissioner, 30 T.C. 757 (need link).applied an additional subjective test, which examines the suitability of the clothing for private or personal wear by the taxpayer seeking the deduction. In other words, the clothing must meet three criteria:

1) The clothing can't be suitable for general or personal wear;
2) It must be required or essential in the taxpayer's employment; and
3) It isn't, in fact, used for general or personal wear.

A case decided in 1966 (Nelson, Oswald, TC Memo 1966-224) allowed an actor to deduct clothing even though it was suitable for general or personal wear. The deciding factor in this case was that the clothes were kept at the studio, and never worn outside of the TV set.

So to answer the above questions..Are uniforms/specialized clothing a legitimate expense?? Yes, if the uniforms used by the pastor are required as a condition of employment. These benefits are provided “tax-free” to the pastor.

Can the uniforms or specialized clothing, not adaptable to general usage be maintained at the pastors personal residence? YES…based on the reasoning provided by the Nelson case. If the pastor takes the suits home, he would have to prove that the suits were not suitable for general or personal wear.

However….(there’s usually one in every case…) While there may an argument that the suits are not suitable for personal wear, the question is a subjective one, and could ultimately be decided by a court that has a difference of opinion than that above. The safest and most prudent course of action is to continue to keep the suits at the studio so that there is no question that the suits are not worn for personal use. And, of course, the issue as to suitability for personal wear remains moot if the suits are left at the studio.