Erik M. Jensen


This article examines the widely noted D.C. Circuit case, Murphy v. Internal Revenue Service, where a panel twice got itself hopelessly entangled in the relationship between the meaning of “income” in the Internal Revenue Code and its meaning in the Sixteenth Amendment. At issue was whether a whistle-blower's recovery for emotional distress could be reached by the income tax. The first time around, the panel concluded that the recovery could not be taxed constitutionally because it was not income. The second time, apparently after having visited another planet, the very same panel concluded that the recovery could be taxed whether or not it was income. Murphy provides the opportunity to reconsider many basic principles of American taxation. Although nearly all commentators condemned the result in Murphy I - sky-is-falling rhetoric was common - and then breathed a sigh of relief when Murphy II was decided, this article perversely argues that the panel’s first result was more defensible than its second.


Income, Sixteenth Amendment, Internal Revenue Code, Murphy v. Internal Revenue Service, Recovery Emotional Distress, Unapportioned Tax, Direct Tax, Gross Income, Personal Rights, Recovery of Basis

Publication Date


Document Type


Place of Original Publication

Case Western Reserve Law Review

Publication Information

60 Case Western Reserve Law Review 751 (2010)


COinS Erik M. Jensen Faculty Bio