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taxpayer to prove that all or part of those funds is not taxable.
Hardy v. Commissioner, 181 F.3d 1002, 1004 (9th Cir. 1999), affg.
T.C. Memo. 1997-97. Accordingly, petitioner bears the burden of
proof. See Rule 142(a).
Section 61(a) provides that gross income includes all income
from whatever source derived. Section 61(a) broadly applies to
any accession to wealth, and statutory exclusions from income are
narrowly construed. See Commissioner v. Schleier, 515 U.S. 323,
327 (1995); United States v. Burke, 504 U.S. 229, 233 (1992);
Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431 (1955).
As applicable here, section 104(a) excludes from gross
income:
SEC. 104. COMPENSATION FOR INJURIES OR SICKNESS.
(a) In General.–– Except in the case of amounts
attributable to (and not in excess of) deductions
allowed under section 213 (relating to medical, etc.,
expenses) for any prior taxable year, gross income does
not include––
* * * * * * *
(2) the amount of any damages (other than
punitive damages) received (whether by suit or
agreement and whether as lump sums or as periodic
payments) on account of personal physical injuries
or physical sickness;
* * * * * * *
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