Roosevelt Wallace - Page 8




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          Revenue Code, section 139(a)(3), as an exemption from income with           
          respect to veterans’ benefits.                                              
               Petitioner also relies on Rev. Rul. 72-605, 1972-2 C.B. 35,            
          wherein the Commissioner ruled with respect to the almost                   
          identical language in a predecessor version of 38 U.S.C. section            
          5301 (2000):  “[P]ayments of benefits under any law administered            
          by the Veterans’ Administration are excludable from the gross               
          income of a recipient under section 61 of the Code.”                        
               B.  Respondent’s Argument                                              
               Respondent does not dispute that petitioner participated in            
          the CWT program for therapeutic reasons, or that, because he                
          participated in the program, he received a distribution of                  
          $16,393 from of the VA Special Therapeutic and Rehabilitation               
          Fund.  Respondent argues that petitioner overstates his case when           
          he argues that money is a benefit and, by that fact alone, is               
          exempt from taxation to petitioner under the general exemption              
          for veterans’ benefits found in section 5301 of title 38.                   
          Respondent adds:  “The monies paid to the petitioner for his                
          participation in the program are unlike those payments made to              
          taxpayers under legislatively-provided-social-welfare-benefit               
          programs, which are excludable from gross income.”                          
               In support of that argument, respondent refers us to a set             
          of his revenue rulings exemplifying payments excludable from                
          gross income not pursuant to the provision of any statute but               







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