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before us is whether such disability payments are exempt under
section 104(a)(1).
Section 61(a) provides that gross income includes all income
from whatever source derived. Certain income, however, may be
specifically excluded from gross income. See sec. 61(b).
Under section 104(a)(1), worker’s compensation amounts are
excluded from gross income. However, such exclusions have been
“strictly construed so as to conform with the general rule that
all income is taxable unless it is specifically excluded.”
McDowell v. Commissioner, T.C. Memo. 1997-500; see Take v.
Commissioner, 804 F.2d 553, 558 (9th Cir. 1986), affg. 82 T.C.
630 (1984).
Section 104(a)(1) excludes from gross income “amounts
received under workmen’s compensation acts as compensation for
personal injuries or sickness”. Section 1.104-1(b), Income Tax
Regs., interprets section 104(a)(1) to exempt amounts received
under a worker’s compensation act, or under a statute “in the
nature of a workmen’s compensation act which provides
compensation to employees for personal injuries or sickness
incurred in the course of employment.”
“Workmen’s compensation act” is defined as a statute which
requires as a precondition to eligibility for benefits that the
injury be incurred in the course of employment. Take v.
Commissioner, supra at 557. A statute is not considered to be in
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