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which there were no withholdings. On line 22 of her 1991 Federal
income tax return petitioner made the following notation:
"Scholarly Prize-nontaxable" and "see attached Form 1099".
Although petitioner disclosed the receipt of the $3,000 award on
her 1991 return, she did not include any portion of it in her
income for that year.
In the notice of deficiency upon which this case is based,
respondent determined that petitioner must include the entire
$3,000 award in her 1991 income and computed the deficiency here
in dispute accordingly.
Discussion
Respondent's determination, having been made in a notice of
deficiency, is presumed correct and petitioner bears the burden
of proving such determination erroneous. Rule 142(a); Welch v.
Helvering, 290 U.S. 111, 115 (1933).
Section 61 provides in general that gross income means all
income from whatever source derived. Sec. 61(a). Specifically,
section 74(a) provides that gross income includes amounts
received as prizes and awards. An exception to the provisions of
section 74(a) is provided in section 74(b), which provides:
Gross income does not include amounts received as
prizes and awards made primarily in recognition of
religious, charitable, scientific, educational,
artistic, literary, or civic achievement, but only if--
(1) the recipient was selected without any
action on his part to enter the contest or
proceedings;
(2) the recipient is not required to render
substantial future services as a condition to
receiving the prize or award; and
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