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"personal injury". I had worked for the company for
almost twenty three years, more than half my life at
that time period, and have not rebound[ed] either
financially or personally since that time period.
Except as otherwise provided, gross income includes income
from all sources. Sec. 61(a); Commissioner v. Glenshaw Glass
Co., 348 U.S. 426 (1955). While section 61(a) is to be broadly
construed, statutory exclusions from income are narrowly
construed. Commissioner v. Schleier, 515 U.S. , 115 S. Ct.
2159, 2163 (1995); Kovacs v. Commissioner, 100 T.C. 124, 128
(1993), affd. without published opinion 25 F.3d 1048 (6th Cir.
1994).
Under section 104(a)(2), gross income does not include "the
amount of any damages received (whether by suit or agreement and
whether as lump sums or as periodic payments) on account of
personal injuries or sickness". Section 1.104-1(c), Income Tax
Regs., provides:
(c) Damages received on account of personal
injuries or sickness. * * * The term "damages
received (whether by suit or agreement)" means an
amount received * * * through prosecution of a legal
suit or action based upon tort or tort type rights, or
through a settlement agreement entered into in lieu of
such prosecution.
Thus, an amount may be excluded from gross income only when
it was received both: (1) through prosecution or settlement of an
action based upon tort or tort type rights; and (2) on account of
personal injuries or sickness. Commissioner v. Schleier, 515
U.S. at , 115 S. Ct. at 2166-2167; Wesson v. United States, 48
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