The Receipt of Cash for Losses of Personal Rights


Erik M. Jensen


The D.C. Circuit’s first decision in Marrita Murphy v. IRS, concluding that a recovery for emotional distress was not taxable, received wide criticism. This viewpoint demonstrates that, contrary to conventional wisdom, the IRS before Murphy had a well-developed view that the receipt of cash for loss of a personal right was not a taxable event, regardless of whether any basis recovery or statutory exclusion was involved.


Marrita Murphy v. IRS, 46 F.3d 79 (D.C. Cir.), Compensation - Loss of Personal Rights, Taxable Income, Taxation, Accession to Wealth, IRC 14(a)(2)

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Tax Notes

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16 Tax Notes 103 (2010)


COinS Erik M. Jensen Faculty Bio