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respondent. We conclude that petitioners bear the burden of
proving that respondent’s determination is wrong.2 Rule 142(a).
As a general rule, the Internal Revenue Code imposes a tax
on the taxable income of every individual. Sec. 1. Section
61(a) specifies that, “Except as otherwise provided”, gross
income for purposes of calculating such taxable income means “all
income from whatever source derived”. The Supreme Court has long
reiterated the sweeping scope of section 61. Commissioner v.
Schleier, 515 U.S. 323, 327 (1995); Commissioner v. Glenshaw
Glass Co., 348 U.S. 426, 429-431 (1955); Banaitis v.
Commissioner, 340 F.3d 1074, 1079 (9th Cir. 2003), affg. in part
and revg. in part on another ground T.C. Memo. 2002-5. “Pensions
and retirement allowances paid either by the Government or by
private persons constitute gross income unless excluded by law.”
Sec. 1.61-11(a), Income Tax Regs.
Section 104, in contrast, provides an exception with respect
to compensation for injuries or sickness. Such exclusions from
gross income are construed narrowly. Commissioner v. Schleier,
supra at 328; United States v. Burke, 504 U.S. 229, 248 (1992)
(Souter, J., concurring in judgment); Banaitis v. Commissioner,
supra at 1079. Section 104 reads in pertinent part:
2 We note that our decision in this case would not change
if respondent bore the burden of proof.
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