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United States Tax Court
March 12, 2004, Filed
WHERRY, Judge: This case was heard pursuant to the provisions of section 7463 of the Internal Revenue Code in effect at the time the petition was filed.1 The decision to be entered is not reviewable by any other court, and this opinion should not be cited as authority.
Respondent determined Federal income tax deficiencies for petitioners' 1997 and 1998 taxable years in the amounts of $ 898 and $ 30,008, respectively. Respondent also determined an accuracy-related penalty in accordance with section 6662(a) of $ 3,793 for 1998. After concessions [*2] by petitioners, the sole issue for decision is whether a $ 30,000 payment received by petitioner Wally O. Oyelola (also known as Oluwole Oyelola and hereinafter Mr. Oyelola) is excludable from gross income under section 104(a).
Some of the facts have been stipulated and are so found. The stipulations of the parties, with accompanying exhibits, are incorporated herein by this reference. At the time the petition was filed in this case, petitioners resided in Tolland, Connecticut.
Mr. Oyelola began working for Connecticut Mutual Life Insurance Company in December of 1989. On May 13, 1996, Mr. Oyelola filed a racial discrimination complaint against Connecticut Mutual Life Insurance Company with the Connecticut Commission on Human Rights and Opportunities. This complaint was amended on August 5, 1996, but was ultimately dismissed because it was not filed within 180 days of the alleged unlawful employment practices.
Thereafter, on February 11, 1998, Mr. Oyelola brought an action against Massachusetts Mutual Life Insurance Company 2 and various individuals in the U.S. District Court for the District of Connecticut. The complaint [*3] in this action, brought under Title VII of the Civil Rights Act of 1964, alleged a history of discrimination based on race, color, ancestry, and national origin.
The District Court action was resolved by a General Release, Confidential Separation Agreement, Waiver and Covenant Not To Sue (settlement agreement) executed by Mr. Oyelola and a representative for Massachusetts Mutual Life Insurance Company and the individual defendants on August 20 and 27, 1998, respectively. The stated purpose of the settlement agreement was "to resolve any and all differences that may now exist, or may arise in the future as a result of any act that has heretofore occurred, under state or federal law regarding employment with and separation from the Company". The document then provided in Paragraph [*4] 4 for the following settlement terms:
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2004 Tax Ct. Summary LEXIS 30 *; T.C. Summary Opinion 2004-28
WALLY O. AND KATE A. OYELOLA, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent
Notice: [*1] PURSUANT TO INTERNAL REVENUE CODE SECTION 7463(b), THIS OPINION MAY NOT BE TREATED AS PRECEDENT FOR ANY OTHER CASE.
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