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petitioner for physical injuries. The complaint that SCOE filed
in State court alleges that petitioner is mentally unfit to
teach, but it says nothing about her physical health. The other
pleadings filed in connection with the State court case also omit
any mention of petitioner’s physical condition. Petitioner
argues that she suffered work-related physical injuries while
employed with SCOE and that SCOE was aware of her injuries. Even
if petitioner is correct, however, the question is whether the
$50,000 was paid on account of such injuries. See sec.
104(a)(2). There is nothing in the record linking the settlement
proceeds to petitioner’s diabetes or other physical injuries.
Accordingly, respondent’s determination is sustained. Based on
our resolution of this issue, we do not address whether the
underlying cause of the State court action was based upon tort or
tort type rights. See Allum v. Commissioner, supra.
Reviewed and adopted as the report of the Small Tax Case
Division.
To reflect the foregoing,
Decision will be entered
for respondent.
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Last modified: May 25, 2011