Stephen Hayden - Page 11

                                       - 11 -                                         
          when he/she became disabled and did not return to work within 24            
          months.  We do not believe that such payments are based upon the            
          type and severity of the injury as required by section 105(c)(2).           
               Furthermore, here, petitioner’s total disability benefit was           
          not calculated simply by virtue of his sustaining an injury.                
          Rather, it was contingent upon his absence from his job.  Payments          
          that are designed to replace the income an employee has lost due to         
          disability, rather than to compensate for the injury itself, cannot         
          be said to be computed without regard to the length of time the             
          employee was absent from work.  Beisler v. Commissioner, supra at           
          1308; Armstrong v. Commissioner, T.C. Memo. 1993-579.                       
               Section 105(c)(2) requires that the amount of the benefit be           
          calculated with reference to the nature of the particular injury            
          and that the amount not vary according to whether the injured               
          taxpayer retired immediately after the injury, returned to work             
          after some recuperation period, or returned to work immediately.            
          See S. Rept. 1622, 83d Cong., 2d Sess. 183-184 (1954) (accompanying         
          H.R. 8300, which was enacted as Internal Revenue Code of 1954, ch.          
          736, 68A Stat. 1); sec. 1.105-3, Income Tax Regs.  In the case at           
          hand, the monthly benefit to a totally disabled employee under the          
          UNUM policy spans a period beginning 90 days after he first becomes         
          unable to work and ending when he is able to work.  Had petitioner          
          been out of work for a period sufficient to collect a monthly               
          benefit and then returned to full duties, he still would have been          






Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  Next

Last modified: May 25, 2011