- 4 - Relying specifically upon section 105(a),1 see also sec. 104(a)(3), respondent takes the position that the payments are includable in petitioners’ income because (1) they are attributable to contributions made by his employer and not includable in his income, or (2) they were paid by his employer. As noted, during 1998, petitioner was awarded worker’s compensation benefits totaling $15,852.29 as a result of the back injury he sustained in the previous year. Worker’s compensation benefits are excludable from income, see sec. 104(a)(1), and there is no dispute on that point in this case. However, only a portion of petitioner’s worker’s compensation award was paid directly to petitioner. In accordance with the agreement, the remainder was used to reimburse Anheuser for the payments. Absent circumstances such as those that exist in this case, an amount described in section 105(a) constitutes income to the recipient/taxpayer because the amount constitutes an accession to the recipient/taxpayer’s wealth. In this case, although the payments might be generally of the type contemplated by section 1 Sec. 105(a) states: 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.Page: Previous 1 2 3 4 5 6 Next
Last modified: May 25, 2011