- 7 -
We agree with respondent. Respondent’s position is
supported by statements of this Court and the Court of Appeals
for the Ninth Circuit, although the issue was not squarely
before either Court. The Court of Appeals stated in Roemer v.
Commissioner, 716 F.2d 693, 699 n.4 (9th Cir. 1983), revg.
79 T.C. 398 (1982), that “a corporation by its very nature cannot
suffer a personal injury. A corporation is a business entity and
not a human being”. This Court later stated in a Court-reviewed
opinion that “Exclusion under section 104 will be appropriate if
compensatory damages are received on account of any invasion of
the rights that an individual is granted by virtue of being a
person in the sight of the law.” Threlkeld v. Commissioner,
87 T.C. 1294, 1308 (1986), affd. 848 F.2d 81 (6th Cir. 1988). We
noted, referring to the Court of Appeals statement above, that
“Although a corporation is treated as a ‘person’ for many
purposes, it is, nonetheless, a business entity and not a human
being. We do not suggest that a corporation could avail itself
of the exclusion granted by sec. 104(a)(2).” Id. at 1308 n.7.
This issue was squarely presented in Boyette Coffee Co. v.
United States, 775 F. Supp. 1001 (W.D. Tex. 1991), where the
court held that the taxpayer/corporation did not suffer a
personal injury as a matter of law. The language of section 104,
when read as a whole, helped to persuade the court in that case
that the term “personal injury” as used in section 104(a)(2) does
not apply to a corporation. We likewise hold that petitioner did
Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011