TAX COURT OPINION

Case: Susan Megin
Docket Number: 22118-07S
Judge: Colvin
Opinion Type: bench
Filed: 10/30/2008
Pages: 7

U W iITED STATES(cid:127)TAX COURT SHINGTON, D .C . 2021 7 SUSAN MEGIN, Petitio pier, V Docket No . 22118-07 S . COMMISSIONER OF INTERN L REVENUE , Respondnt . 0. R D E R ,Pursuant to Rule 152(b), Tax Court Rules of Practice an d Procedure, it is .. ORDERED that the to petitioner and to r transcript of. .the tria Judge Lewis R . Carluzz 2008, containing his-o at the conclusion of t lerk of the Court shall transmit herewith spondent a copy of the pages of the . 1 of the above .ca-se before Special Trial o at Pocatello, Idaho, on-September 12, ral findings of fact and opinion rendered rial . In accordance wit decision will be enter h the oral findings o .f fact and opinion, ed for respondent . (Signed ) Lewis R. Carluzzo Special Trial Judg e Dated : Washington, D . October 30, 20 C . 08 SERVED OCT 3 1 -;r 1 Bench Opinion by (Special Trial Judge Lewis R . Carluzz o 2 Susan Megin 3 22118-07 S 4 September 12, 2 08 5 Docket Numbe r 6 THE COURT : The Court has decided to render 7 oral findings o fact and opinion in this case, and 8 the following represents the Court' s oral findings- of 9 fact and opinion . The oral findings of fact and 10 opinion shall not be relied upon as precedent in any 11 other case . 12 This pr, ceeding for the redetermination of a 13 deficiency is a mall Tax Case conducted pursuant to 14 the provisions of section 7463 of the Interna l 15 Revenue Code of 1 86, as amended, and Rules 170 through 16 175 of the Tax Court Rules of Practice and Procedure . 17 This bench opinion is made pursuant to the 18 authority granted by section 7459(b)of the Internal 19 Revenue Code of 986, as amended, and Rule 152 of the 20 Tax Court Rules of Practice and Procedure . 21 Hereina ter in this bench opinion, unless 22 otherwise noted, section references are to th e 23 Internal Revenue Code of 1986, as amended, in effect 24 for 2005 . 25 Susan M gin appeared pro se . John D . Davi s He stage Reporting Corporation (202) 628-4888 1 appeared on beh if of respondent . 2 In a no ice of deficiency dated September 17, 3 2007, responden determined a $2,473 deficiency i n petitioner's 20C5 Federal income tax . The issue for decision is whether disability benefits received by 6 petitioner duri g 2005 from the Colorado Publi c Employees Retir ment Association (PERA) are includable in h r income for that year . Some of the facts have been stipulated and ar e so found . At t e time the petition was filed , petitioner resi led in Idaho . Prior to the year in issue petitioner wa s employed as an mergency dispatcher for the City o f Pueblo, Colorad ( .the City) . She first began workin g for the City in he 1970's and after a break in servic e returned to her job in 1990 . . As an employee of th e City petitioner was enrolled in, contributed to an d was covered by ERA . Her contributions to PERA wer e made on a preta basis . Dating back at least to December 1994 , petitioner was treated for various health problem s either caused or aggravated by her working conditions . S e made numerous requests to the Cit y to take her he lth conditions into account in he r workplace, but her requests either were ignored o r H~ritage Reporting Corporation (202) 628-4888 10 11 12 13, 14 15. 16 17 18 19 20 21 22 23 24 25 5 1 denied . In any event, by application dated May 17, 2 1996, petitioner applied to PERA for permanent 3 disability retirement benefits . In a letter dated 4 August 26, 1996 PERA advised petitioner that her 5 . application for a disability benefit was considered 6 and approved . he letter noted that in accordance 7 with petitioner s election, .she would receive th e 8 disability bene it in the form of monthly payments . 9 The letter went on to advise her that her benefit will 10 be reported as taxable income . 11 Consistent with coverage under PERA, th e 12 amount of the disability benefit that petitioner was 13 to receive was c lculated with reference to her years 14 of service, and compensation while covered by PERA . 15 During 2005 petitioner received $15,476 in disability 16 benefits from P RA (the disability benefit), a s 17 evidenced on a orm 1099-R, issued to petitioner by 18 PERA . 19 Petiti per's 2005 Federal income tax return 20 was timely file The disability benefit is not 21 included in the income reported on that return . I n 22 the above-refer, Enced notice of-deficiency respondent 23 determined that the disability benefit is includable 24 in her income f or that year . 25 . The tel m gross income as used in the Interna l Hjritage Reporting Corporation (202) 628-4888 1 Revenue Code is broadly construed . Unles s 2 specifically ex mpted or excluded, the term includes 3 all income from whatever source derived and al l 4 accessions to a taxpayer's wealth . Sec . 61(a) ; 5 Commissioner v . Glenshaw Glass Co ., 348 U .S . 42 6 6 . ( .1955) Exclus ons from income, on the other hand, 7 are narrowly co strued . Commissioner v . Schleier , 8 -515 U .S . 323 (19 5) . The disability benefit received 9 by petitioner, f from PERA during 2005 was an accessio n 10 . to her wealth an is therefore includable in her income 11 unless specific lly exempted or excluded . 12 Allega ions contained in the petition, and 13 petitioner's pr sentation at trial suggest that she 14 supports the exclusion of the disability benefit upon 15 the ground that the benefit was received under a 16 worker's compen ation act, or a statutory scheme in 17 the nature of a worker's compensation act . See sec . 18 104(a)(1) . In upport of her position she points to 19 language in pub ished guidance issued by respondent 20 to the effect that payment received under the Federal 21 Employees' Compensation Act (FECA) for persona l 22 injury or sickn ss are not taxable . FECA, of course, 23 if not conside ed a worker's compensation act, is 24 certainly a statutory scheme in the nature of a 25 worker's compensation act . The tax treatment o f H~ritage Reporting Corporation (202) 628-4888 7 1 amounts received under FECA, however, provides little 2 guidance here, as the disability benefit petitioner 3 received was no received under FECA . 4 Further tore, because the disability benefit 5 petitioner received from PERA was calculated with 6 reference to he length of service and compensation 7 while covered b PERA, the disability benefit cannot 8 be considered tc have been received from a statutory 9 scheme in the nature of a worker's compensation act, 10 even though her retirement was occasioned o r 11 aggravated by a occupational injury or sickness . 12 Wiedmaier v . Commissioner, T .C . Memo . 1984-540, affd . 13 774 F .2d 109 (6th Cir . 1985) ; sec . 104-1 (b) , Income Tax 14 Regs . 15 Lastly, petitioner points out that she was 16 the petitioner in a previous case in this Cour t 17 involving a similar issue for a year prior to the year 18 in issue here . hat case, docket number 10779-03, was 19 closed by a stipulated decision entered on December 20 3, 2003, that reflects respondent's apparen t 21 concession of the issue . Because the previous case 22 was resolved by settlement, however, it plays no role 23 in the resolution of this case . 24 The disability benefit petitioner received 25 from PERA during 2005 is includable in her income for Heritage Reporting Corporatio n (202) 628-4888 1 that year and respondent's determination to that end 2 is sustained . To reflect the foregoing, decision will be entered for respondent . 5 This concludes the Court's oral findings o f 6 fact and opinion in this case . (Whereupon, at 2 :40 . p .m ., the bench opinion was concluded . ) // 7 9 10 11 12 13 // 14 // 1 5 16 17 18 19. 20 2 1 22 23 24 25 Her'tage Reporting Corporation (202) 628-4888