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Editor: Daniel J. Alvarez, J.D.
Profession: Settlement Planner, Millennium Settlements

Category: Case Law Updates

The Court of Appeals for the District of Columbia has held that section 104(a)(2) of the Internal Revenue Code is unconstitutional to the extent it permits taxation of damages for nonphysical personal injuries that are unrelated to lost wages or earnings.

The decision although surprising and potentially encouraging has been met with tempered enthusiasm by most analysts. Its effect is limited based on a number of factors including likelihood of appeal by the government but is worth noting nonetheless.