United States v. Burke, 504 U.S. 229, 21 (1992)

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Cite as: 504 U. S. 229 (1992)

O'Connor, J., dissenting

"Congress declined to recompense Title VII plaintiffs for anything beyond the wages properly due them." Ante, at 241. I cannot agree. In my view, the remedies available to Title VII plaintiffs do not fix the character of the right they seek to enforce. The purposes and operation of Title VII are closely analogous to those of tort law, and that similarity should determine excludability of recoveries for personal injury under 26 U. S. C. 104(a)(2).

I

Section 104(a)(2) allows taxpayers to exclude from gross income "damages received . . . on account of personal injuries or sickness." The Court properly defers to an Internal Revenue Service (IRS) regulation that reasonably interprets the words "damages received" to mean "an amount received . . . through prosecution of a legal suit or action based upon tort or tort type rights, or through a settlement agreement entered into in lieu of such prosecution." 26 CFR 1.104-1(c) (1991). See ante, at 234; United States v. Correll, 389 U. S. 299 (1967). Therefore, respondents may exclude from gross income any amount they received as a result of asserting a "tort type" right to recover for personal injury.

The Court appears to accept that discrimination in the workplace causes personal injury cognizable for purposes of 104(a)(2), see ante, at 239, and there can be little doubt about this point. See Goodman v. Lukens Steel Co., 482 U. S. 656, 661 (1987) ("[R]acial discrimination . . . is a fundamental injury to the individual rights of a person"); Price Waterhouse v. Hopkins, 490 U. S. 228, 265 (1989) (O'Connor, J., concurring in judgment) ("[W]hatever the final outcome of a decisional process, the inclusion of race or sex as a consideration within it harms both society and the individual"). I disagree only with the Court's further holding that respondents' action did not assert tort-like rights because Congress limited the remedies available to Title VII plaintiffs. Focusing on remedies, it seems to me, misapprehends the

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