- 4 -
Discussion3
As previously stated, the issue before the Court is whether
certain worker’s compensation benefits petitioner received in
lieu of Social Security disability benefits are includable in
petitioners’ gross income for taxable year 2001 under section 86.
Petitioners maintain that since petitioner did not receive
an actual payment from the Social Security Administration during
2001 because of the offset of workmen’s compensation benefits
received in that year, it is unfair to include the offset amount
in their 2001 income. Respondent maintains that although
petitioners did not receive an actual payment from the Social
Security Administration during 2001, they must nevertheless
include the offset amount in their 2001 income under section
86(d)(3).
Gross income includes “all income from whatever source
derived” unless specifically excluded. Sec. 61(a). Generally,
gross income does not include “amounts received under workmen’s
compensation acts as compensation for personal injuries or
sickness”. Sec. 104(a)(1). Social Security benefits, however,
are included in gross income as provided by section 86.
3We decide the issue in this case without regard to the
burden of proof. Accordingly, we need not decide whether the
general rule of sec. 7491(a)(1) is applicable in this case. See
Higbee v. Commissioner, 116 T.C. 438 (2001).
Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011