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absent from work. See Hines v. Commissioner, 72 T.C. 715, 720
(1979). “Payments from a disability plan do not qualify for the
section 105(c)(2) exclusion if the payments are the same
regardless of the nature and severity of the particular injuries
causing the disability.” Hayden v. Commissioner, T.C. Memo.
2003-184 (citing Hines v. Commissioner, supra), affd. 127 Fed.
Appx. 975 (9th Cir. 2005). The Court must conclude that the
payments to Mr. Thomas fail the first requirement of section
105(c)(2) because Mr. Thomas’s disability pension benefits were
calculated based on his age and years of employment with Stone
Container, and were unaffected by the nature and severity of his
disability.
PIUMPP disability pension benefits are available only to
employees that meet a minimum term of employment. The PIUMPP
clearly provides that the amount of disability pension benefits
an employee is entitled to receive is based on the employee’s
years of employment. Mr. Thomas’s Notice of Pension Award, and
calculations of his benefits, show that his $498 monthly payments
were based on his age at the time of his disability and his 25.75
years of employment. Although Mr. Thomas’s disability triggered
his entitlement to receive disability pension benefits, the
amount of his monthly benefits was determined by his age and
duration of employment, not by the nature and severity of his
disability.
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