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Burke, petitioner’s title VII recovery is not excludable from
gross income under section 104(a)(2).
Petitioner advances several arguments in support of her
contention that the proceeds received from her title VII claim
are excludable from income. Petitioner’s first argument draws
upon the reasoning contained in a dissenting view expressed by
Justice O’Connor in United State v. Burke, supra at 249. That
dissenting view suggests that the focus should be on the broad
policy underlying title VII rather than the possible remedies
available to claimants. In the dissent, it was also pointed out
that title VII actions did not “fix the character of the right”
that plaintiffs were seeking to enforce. Trying to capitalize on
that reasoning, petitioner contends that, under the laws of her
State, her suit was based in common-law torts (assault, battery,
sexual assault, and sexual battery). Although the form of the
title VII relief was denominated as “wages”, petitioner argues
that, in substance, her claim was founded in tort. We note,
however, that if petitioner had an alternative cause of action
under State law, she chose not to pursue it and, instead, brought
her action under title VII.
In order to bolster her substance argument, petitioner cites
Central Foundry Co. v. Commissioner, 49 T.C. 234, 251 (1967), and
states that the tax treatment of the result of litigation should
not turn upon which remedy or course of action is selected by the
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