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After a concession by petitioner, the sole issue for
decision is whether petitioner is entitled to exclude from gross
income amounts received as disability payments during 1993.
Background
Some of the facts have been stipulated, and they are so
found. The stipulation of facts and the attached exhibits are
incorporated herein by this reference. At the time he filed his
petition, petitioner resided in Costa Mesa, California.
Petitioner worked for the City of Santa Ana, California (the
City), as a grounds maintenance worker, earning approximately
$2,250 per month. The City provided petitioner with long-term
disability insurance through Standard Insurance Co. of Portland,
Oregon (Standard).
Standard offers two disability insurance options to the
City’s employees. Under plan A, a disabled employee is eligible
to receive one-half of his base monthly salary until his
disability ends or until he reaches age 65.2 The City pays the
entire premium for this coverage, but an employee is not eligible
for the benefits until he is unable to work for 130 days because
of the disability. Under plan B, a disabled employee receives
2 Section 1 of Standard’s group policy states:
The amount of Monthly Income shall be 50% of
the first $5,000 of the Member’s basic
monthly earnings, reduced by any Deductible
Benefits.
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Last modified: May 25, 2011