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pursuant to the terms of section 2610(a) of the Charter, from 75
to 50 percent of 1-year average compensation. This recomputed
amount was equal to the amount petitioner would have received if
he had served without interruption for 25 years and retired for
service on that date, with one modification: the compensation
base to which the 50-percent allowance was applied was 1-year
average compensation rather than the 3-year average compensation
utilized in computing "regular" service retirement allowances
under Oakland Charter section 2608.
The parties have stipulated that the amounts received prior
to October 31, 1991, are excludable under section 104(a)(1). The
parties have also stipulated that petitioner did not receive any
service credit under section 2609 of the Oakland Charter for the
time during which he received a disability retirement allowance
pursuant to section 2610(a) of the Charter.
During the year in issue, petitioner received payments
totaling $27,007 from the City of Oakland, awarded pursuant to
section 2610(a) of the Charter. The parties have stipulated that
the only issue for decision is whether those payments are
excludable from gross income as disability payments under section
104(a)(1).
The Internal Revenue Code defines “gross income” as follows:
"Except as otherwise provided in this subtitle, gross income
means all income from whatever source derived". Sec. 61(a). One
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