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income under section 104(a)(2). Sodoma v. Commissioner, supra.
Viewing the facts in the light most favorable to petitioner, it
can be argued that petitioner's filing of complaints with IBM's
grievance committee is at least some evidence of an existing
dispute between the parties that could have provided the basis
for settlement. Thus, we find, for purposes of this motion only,
that petitioner has met the first prong of excludability under
section 104(a)(2) in that he has established the existence of an
underlying tort-type cause of action. See Commissioner v.
Schleier, supra; also see Taggi v. United States, supra at 96 (a
claim must be bona fide, but does not necessarily have to be
sustainable or valid).
We now turn to the language of the release itself. The
release in this case is the same as that in Webb v. Commissioner,
T.C. Memo. 1996-50, and essentially the same as that in Sodoma v.
Commissioner, supra. By its terms, petitioner released IBM from
liability for both contract and tort claims. The release,
however, does not specifically indicate that the lump-sum payment
received by petitioner was paid to settle a potential personal
injury claim against IBM. We note that where the settlement
agreement lacks express language stating what the settlement
amount was paid to settle, then the most important factor is the
intent of the payor. Knuckles v. Commissioner, 349 F.2d 610, 612
(10th Cir. 1965), affg. T.C. Memo. 1964-33; Stocks v.
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