- 13 -
Petitioners acknowledged at trial that the benefits were not
designed to reimburse Mr. Wright for any medical expenses. In
addition, petitioners did not provide any evidence that the
benefit payments received were payments for a permanent loss of
use of a member or function of Mr. Wright’s body. Further, the
record indicates that the STRS benefits received by petitioners
were not based on or paid with reference to the severity of Mr.
Wright’s injury. Accordingly, Mr. Wright’s benefits are not
excludable under these two exceptions.
Mr. Wright testified that he excluded 40 percent of his
benefits from gross income based on his alleged 8-percent of
compensation contribution and his employer’s alleged 12-percent
of compensation contribution to the plan. Mr. Wright relied on
the idea that, of the total amount contributed, his portion
constituted 40 percent and his employer’s portion was 60 percent.
However, these assertions fall short of demonstrating that 40
percent of the benefits received by Mr. Wright may be excluded
from gross income for several reasons. First, petitioners’ brief
indicates that their 40-percent exclusion rate, and thus the
underlying 8- and 12-percent contribution split upon which it was
based, was only an approximation derived from various STRS rate
contribution schedules that changed over the period of
Mr. Wright’s employment. Hence, Mr. Wright’s testimony failed to
substantiate that 40 percent of his benefits were solely the
Page: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 NextLast modified: May 25, 2011