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personal injury under section 104(a)(2). We hold that $64,510.60
(45.43 percent of the $137,437.50 payment) was prejudgment
interest, and is not excludable under section 104.
Unless otherwise specified, section references are to the
Internal Revenue Code in effect for the year in issue. Rule
references are to the Tax Court Rules of Practice and Procedure.
Background
The parties submitted this case fully stipulated under Rule
122.
A. Petitioner
Petitioner resided in North Scituate, Rhode Island, when he
filed his petition.
On October 12, 1982, while petitioner was driving his
motorcycle, he was struck by a truck attempting to make an
illegal U-turn. The truck was owned by Allied Fence & Guardrail,
Inc. (Allied Fence), and driven by an Allied Fence employee.
Petitioner suffered serious back injuries, requiring more than 3
years of physical therapy.
B. The Tort Action, Judgment, and Interest
Petitioner was represented by John Coughlin (Coughlin) who
filed a personal injury lawsuit on petitioner's behalf in the
Superior Court of Rhode Island on November 13, 1984, against
Allied Fence and the employee driving the truck. Allied Fence
was represented by Peter J. Comerford (Comerford) and was insured
by Aetna Life and Casualty (Aetna).
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