- 3 -
Respondent’s motion for summary judgment concedes that
there was reasonable cause for the understatement of tax
required to be shown on petitioners’ 2002 return and that
petitioners acted in good faith. Accordingly, respondent
concedes, pursuant to section 6664(c), that petitioners are
not liable for the accuracy-related penalty of $1,254. In
light of that concession, respondent’s motion is deemed to
be a motion for partial summary judgment.
The petition asserts that $30,000 of the amount
received from the Campbell v. State Farm Settlement Fund
“was for personal injury” and is not includable in gross
income. The petition refers to the fact that this amount
was received in connection with the settlement of Campbell
v. State Farm Mut. Auto. Ins. Co., CIV 99-505-TUC, D. Ariz.
(hereafter referred to as Campbell v. State Farm) a
lawsuit that expressly required participants to have
“sustained [personal] injury”. The petition asserts that
the remainder, $199, “was for interest”. The petition
states that petitioners had “sent $32.86 to the IRS as
payment for the additional taxes for $199.”
According to respondent, the record “clearly shows
that Campbell v. State Farm was not a personal injury suit,
but was solely a complaint for compensatory damages, plus
interest and fees, directly and proximately arising from
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011