T hi s di s pos i t i on i s notappr opr i a t e f orpubl i c a t i on and i s notpr e c e de nt * e xc e pta s pr ovi de d byN i nth C i r c ui tR ul e 36- 3.

T he pa ne l una ni m ous l yc onc l ude s thi s c a s e i s s ui t abl e f orde c i s i on ** w ith o u t o r a l a r g u m e n t. See F ed. R . A pp . P . 34 (a )( 2). NOT F OR P UB L I CAT I ON UN I TE D STATE S C OU RT OF APPE ALS FOR T HE NI NTH CI RC UI T CE CI L R . HA W KI NS a n dCAROL L . H A W K I N S, P et i t i o n ers - A p p el l an t s, v. C OMMI S S I ON E R OF I NT E RNA L RE VENU E, R es po nd ent- A pp el l ee . N o. 07- 74384 C IRN o. 22 83 3-5 ME MOR AN DU M *

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a s ett l em entre coveryby C ar ol i n 2 00 3 i n the am ou ntof $2 5, 00 0 from her e m pl oy e r . O n appe a l , the H a w ki ns e s a r gue tha tthe t a x c ourte rr e d be c aus e the r e c ove r e d da m a ge s s houl d notha ve be e n i nc l ude d i n gr os s i nc om e pur s ua ntt o the p h y s ic a l in

ju rye x c lu s io n in 2 6 U .S .C . § 1 0 4 ( a ) ( 2 ) . W e h a v e ju r is d ic tio n o v e rth is ma tt e rp u r s u a n tt o 2 6 U . S. C. § 7 4 8 2 ( a ) ( 1 ) , a n dw e a f f i rm. Th e f a c t s o f th i s c a s e a r e k n o w n t o th e p a rt i e s . W e d o n o tr e p e a tth e m. W e r e vi e w at a x c ourt ’ s f a c tua l f i ndi ng f orc l e a re rr ora nd i t s c onc l us i ons of la w d e n o v o . B aize r v . C om m iss i on er , 2 0 4 F .3 d1 2 3 1 , 1 2 3 3

– 3 4 ( 9 th C ir . 2 0 0 0 ) . F or the pu rpose of f

eder al i ncom e t axes , 26 U . S . C . § 6 1(a) prov i des that

“ [ e ] x c e p ta s o th e rw i s e p r o v i d e di n th i s s u b t i t l e , g r o s s i n c o me me a n s a l l i n c o me fr om w hat eversource deri ved. ” T hi s broad defi ni t i on of gross i ncom e i ncl ud es

“ al l gai ns exce pttho se spec i fi ca l l y e xem pt ed. ” C o m m issi o n er v. G len sh a w G la ss C o. , 34 8 U . S . 42 6, 46 0 (19 55 ). O ne e xc e pt i on i s pr ovi de d by26 U . S . C . § 104( a ) ( 2) , w hi c h e xc l ude s f r om gross i ncom e “ the am ou ntof any dam ages (other than p un i t i ve dam ages ) r ec ei ved (w h eth er b y su i to r ag reem en tan dw h eth er as l u m p su m s o r as p eri o d i c p aym en t s) on a c c ountof

pe r s ona l phy s i c a l i nj ur i e s orphy s i c a l s i c kne s s . ” F orthi s e xc l us i on, “e m o tio n a l d is tr e s s s h a ll n o t b e tr e a te da s ap h y s ic a l in ju ryo rp h y s ic a l s ic k n e s s . T he pr e c e di ng s e nt e nc e s ha l l notappl yt o a n a m ountof da m a ge s noti n e xc e s s of3

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lu s h la n g u a g e ) . T h e S e c tio n 1 0 4 ( a ) ( 2 ) e x c lu s io n is c o n s tru e dn a rr o w ly . See C om m iss i on erv. Schl ei er , 5 1 5 U .S . 3 2 3 , 3 2 8 ( 1 9 9 5 ) . H er e, the t ax courtprop er l y c on cl ud ed thatthe $2 5, 00 0 sett l em entw as part of the H a w ki ns e s ’ gr os s i nc om e a nd di d notqua l i f yf orthe S e c t i on 104( a ) ( 2) excl usi on . C ar ol di d n otse ek dam ages st em m i ng fr om “ pers on al ph ys i ca l i nj uri es orphy s i c a l s i c kne s s . ” 26 U . S . C . § 104( a ) ( 2) . N e i the rC a r ol ’ s c om pl a i ntnorthe s e tt l e m e nta gr e e m e ntm e nt i ons a nype r s ona l phy s i c a l i nj ur i e s ors i c kne s s e s . T he H a w ki ns e s a l s o f

a i l e d t o pr ovi de a nydoc um e nt a t i on s how i ng tha tthe y“ pa i d f or m ed i cal care . . . attri b u t ab l e t o em o t i o n al d i stress. ” 2 6 U . S . C . § 1 0 4 (a) (flush la n g u a g e ) . T h e H a w k in s e s ’ r e m a in in g c o n te n tio n s a r e e ith e rm o o t o rw ith o u t m e r it. AF F I RME D.