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sickness.” Petitioners argue that, since Mr. Hurley was only 70
percent capable for the work that he was once 100 percent able to
do, it followed that 30 percent of the wages he received was
attributable to workers’ compensation and, therefore, was
excludable from gross income. The Court disagrees.
Gross income includes compensation for services and wages.
Sec. 61(a); Abrams v. Commissioner, 82 T.C. 403, 407 (1984); sec.
1.61-2(a)(1), Income Tax Regs. Although section 104 does allow a
taxpayer to exclude workers’ compensation payments from gross
income, Mr. Hurley agreed that he was no longer receiving
workers’ compensation, nor were his wages reduced by 30 percent
when he returned to work. Although Mr. Hurley is 30 percent
disabled, petitioners may not redefine the application of section
104 to allow a portion of his wages to be excluded from gross
income. Exclusions from income must be based upon an explicit
statute and may not be inferred. Commissioner v. Schleier, 515
U.S. 323, 328 (1995); United States v. Wells Fargo Bank, 485 U.S.
351 (1988). Respondent, therefore, is sustained on this issue.
The next issue is deductions petitioners claimed on Schedule
A, Itemized Deductions, of their 1999 Federal income tax return.
Petitioners deducted the $4,400 in points they paid to refinance
their mortgage. In the notice of deficiency, amortization of the
points was allowed based on a 30-year mortgage, but, as noted
earlier, respondent conceded at trial that the points were
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