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by * * * [Okabena] for his attorneys’ fees and costs;
and
WHEREAS, * * * [Okabena] expressly denies that it
may be liable to Gross on any basis or that it has
engaged in any improper or unlawful conduct or
wrongdoing against him * * *
The settlement agreement required Okabena to make several
distinct categories of payments to or on behalf of petitioner.
Three of those categories, severance payments, lump-sum payments,
and liquidation payments, are at issue here.3
Severance Payments
Under paragraph 3(a) of the settlement agreement, Okabena
agreed to make 18 monthly payments of $10,417, less all
applicable withholding, beginning on May 1, 1993, and concluding
on October 31, 1994 (severance payments). Petitioners included
these severance payments in gross income and paid the applicable
Federal income taxes on these amounts in 1993 and 1994. The
severance payments form the basis of petitioners’ claim that they
overpaid their Federal income taxes in 1993 and 1994 and are
entitled to a refund.
The Lump-Sum Payments
Under paragraph 3(b) of the settlement agreement, Okabena
agreed to make two lump-sum payments to petitioner--one of
$112,500 shortly after the settlement agreement was executed and
3Okabena satisfied all its obligations under the settlement
agreement.
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