Cliff Connors - Page 15

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          or are paid for by the employee.  See sec. 104(a)(3).  Therefore,           
          petitioner may exclude the amounts he received if he paid                   
          premiums for the disability plan or if his employer paid premiums           
          and the premiums were includable in his gross income.  See Tuka             
          v. Commissioner, supra at 3; Miley v. Commissioner, T.C. Memo.              
          2002-236.  In Tuka, the Court stated:                                       
               Although section 104(a)(3) is not explicit on the                      
               subject, it clearly contemplates that exemption of                     
               benefits depends on whether contributions to an                        
               accident and health insurance plan involve after-tax                   
               dollars.  Indeed, if an employee is to exclude                         
               disability benefits attributable to employer                           
               contributions, those contributions must have been                      
               includable in the employee's gross income.  * * *                      
               [Tuka v. Commissioner, supra at 4.]                                    
          If an employer is the sole purchaser of a policy of accident or             
          health insurance for its employees (on either a group or                    
          individual basis), the exclusion provided under section 104(a)(3)           
          does not apply to any amounts received by his employees through             
          such fund or insurance.  Sec. 1.104-1(d), Income Tax Regs.                  
               Petitioner argues that the benefits he received are not                
          includable in his income because he paid the premiums for the               
          policy.  The policy specifically states that the plan was paid              
          for by ATC, the parent of petitioner’s employer.  Petitioner does           
          not dispute the assertion by Connecticut General, relied on by              
          respondent, in a stipulated exhibit, that the premiums paid were            
          not included in his taxable income.  Petitioner has presented no            
          evidence, reason, or authority to apply the exception under                 

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