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paid under the terms of the UNUM policy for the period of his
absence. It is difficult to conceive how the monthly benefit could
be more closely tailored to an employee’s period of absence from
work. Armstrong v. Commissioner, T.C. Memo. 1993-579, supra.
Payments under the UNUM policy are designed to replace the
income an employee lost due to disability and are computed with
regard to the employee’s absence from work. The UNUM policy
plainly did not compute the amount of payments "with reference to
the nature of the injury," nor did it award benefits "without
regard to the period the employee [was] absent from work." We
conclude, therefore, that the benefits are not excluded from income
under section 105(c).
We have considered various arguments made by petitioner not
discussed above and have not found them persuasive
To reflect the foregoing and the parties’ concessions,
Decision will be entered
for respondent with respect to
the deficiencies and for
petitioner with respect to the
additions to tax under section
6651(a).
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Last modified: May 25, 2011