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104(a)(2)1 amounts received from petitioner Dorothy M. Keel's
employer upon termination of her employment on the ground that
such amounts represented damages received on account of personal
injury.
This case was submitted fully stipulated under Rule 122.
The stipulation of facts and the attached exhibits are
incorporated herein by this reference. Petitioners resided in
Beltsville, Maryland, at the time they filed their petition.
Background
Petitioner Dorothy M. Keel (Mrs. Keel) was employed by
International Business Machines Corporation (IBM) until her
termination in 1992. In 1992, IBM terminated thousands of its
employees pursuant to a corporate restructuring plan. Mrs. Keel
received a lump-sum payment of $40,411.21 from IBM in 1992 (the
lump-sum payment) in connection with her termination. The amount
of the lump-sum payment was based on length of her service and
salary.
On June 15, 1992, Mrs. Keel signed a General Release and
Covenant Not to Sue (the release) as a condition for the sums and
benefits, including the lump-sum payment, she received pursuant
to the terms of the Modified and Extended Individual Transition
1 Unless otherwise indicated, all statutory references are to
the Internal Revenue Code in effect for the year in issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
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