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Connelly, docket No. 627-98. These cases were consolidated for
trial, briefing, and opinion pursuant to Rule 141(a).1
The sole issue for our consideration is whether the portion
of petitioners’ judgment allocated as liquidated damages received
in an action under the Fair Labor Standards Act of 1938, 29
U.S.C. secs. 201, 216(b) (1994) (FLSA), is excludable from gross
income as damages received on account of personal injury or
sickness under section 104(a)(2).
FINDINGS OF FACT2
At the time their respective petitions were filed,
petitioners William A. and Ann M. Jacobs, husband and wife,
resided in Silver Lake, Kansas, and petitioners John W. and
Phyllis M. Connelly, husband and wife, resided in Wichita,
Kansas. Ann Jacobs and Phyllis Connelly are petitioners in
this case solely because they joined in filing Federal income
tax returns with their husbands. Hereinafter, references to
“petitioners” refer only to William Jacobs and John Connelly.
Petitioner Jacobs was employed by the Kansas State Highway
Patrol from 1973 to 1997. He worked as a road trooper, an
aircraft pilot, and then held a position in the highway patrol
1 Unless otherwise indicated, Rule references are to this
Court’s Rules of Practice and Procedure, and section references
are to the Internal Revenue Code in effect for the taxable year
in question.
2 The stipulation of facts and the attached exhibits are
incorporated herein by this reference.
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