TAXATION-VALIDITY OF TAX ON INCOME OF SUPERINTENDENT OF SCHOOL CAFETERIA SYSTEM -SOVEREIGN IMMUNITY

Petitioners, husband and wife, residents of Texas, made returns of community income for the year 1932, listing as exempt the salary of the wife who was superintendent of a non-profit cafeteria system operated by the Ft. Worth public schools for the exclusive patronage and benefit of teachers and students. The Commissioner of Internal Revenue refused the exemption and levied a deficiency tax of $105. On appeal from an affirmance of the commissioner's decision by the Board of Tax Appeals, held, reversed on the ground that the operation of the cafeteria system was a proper exercise of a governmental function by the school district, and that the salary of the superintendent, as an employee of a political subdivision and engaged in the performance of a governmental function, was immune from federal income taxation.

Hoskins v. Commissioner of Internal Revenue, (C. C. A. 5th, 1936) 84 F. (2d) 627.