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injuries or sickness is within the meaning of section 104(a)(3).
Hence, the provisions in sections 104 and 105 dealing with
amounts received through health insurance are used to determine
whether petitioner's disability benefits constitute taxable
income.
Section 105(a) provides:
Except as otherwise provided in this section, amounts
received by an employee through accident or health
insurance for personal injuries or sickness shall be
included in gross income to the extent such amounts (1)
are attributable to contributions by the employer which
were not includible in the gross income of the
employee, or (2) are paid by the employer.
The parties stipulated that petitioner's former employer, ECC
International, funded the long-term disability plan and paid all
the premiums. Additionally, petitioner presented no evidence
that the sick pay he received from the long-term disability plan
maintained by his previous employer was excludable from his gross
income. Therefore, we sustain respondent's determination that
the disability payments received by petitioner are includable in
his gross income pursuant to section 105(a).
Issue 3. Whether IRA Distributions Received by Petitioner in
Taxable Years 1995 and 1996, as Well as Pension and Annuity
Distributions Received by Petitioner in 1996, Are Includable in
Gross Income
Annuities and pensions are specifically included in gross
income. See sec. 61(a)(9), (11). In addition, under section
408(d)(1), a distribution from an IRA is generally included in
the gross income of the distributee in the year of distribution.
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