- 4 - In 1998, petitioner filed a race discrimination action against Regions with the U.S. District Court for the Northern District of Alabama, pursuant to title VII of the Civil Rights Act of 1964, as amended. Petitioner alleged that co-workers whom she felt were less qualified were receiving jobs and promotions that she had applied for. Petitioner asserted this was due solely to her race, African-American. Petitioner continued working for Regions while her suit was pending. In November 2001, petitioner and Regions agreed to mediation, which resulted in a settlement wherein Regions agreed to pay petitioner $90,000 in return for the dismissal of the title VII action and her resignation from Regions. Petitioner received $54,000, and her attorney received $36,000 in fees. Both parties agreed to keep the terms of the settlement confidential. Petitioner resigned her employment, and the action was dismissed by joint stipulation on December 4, 2001. Petitioner filed her 2001 Federal income tax return timely but did not include the $54,000 as income on her return. The sole issue before the Court is whether petitioner must include, as gross income, the $54,000 settlement she received from Regions. See supra note 2. Section 104(a)(2) excludes from gross income “the amount of any damages (other than punitive damages) received (whether by suit or agreement and whether as lump sums or as periodicPage: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011