T.C. Memo. 2011-59
UNITED STATES TAX COURT
DAVID DANIEL ROBISON, SR. AND LYDIA A. ROBISON, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 7765-09. Filed March 10, 2011.
David Daniel Robison, Sr., and Lydia A. Robison, pro sese.
Carol-Lynn E. Moran, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
WELLS, Judge: Respondent determined a deficiency of $2,866
in petitioners’ Federal income tax for the 2006 tax year. The
issues we must decide are whether the disability retirement
payments petitioner husband received from the U.S. Office of
Personnel Management (OPM) are excludable from petitioners’
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income pursuant to section 104(a)(4), and whether respondent is
barred from determining a deficiency for petitioners’ 2006 tax
year because he issued closing letters for previous tax years
that accepted petitioners’ returns as filed.1
FINDINGS OF FACT
Some of the facts and certain exhibits have been stipulated.
The parties’ stipulations of fact are incorporated in this
opinion by reference and are found accordingly. At the time they
filed their petition, petitioners resided in Pennsylvania.
Petitioner David Daniel Robison, Sr. (hereinafter
petitioner), served in the U.S. Marine Corps from 1966 until
1972. From December 1966 until February 1968 he served in
Vietnam, where he sustained a variety of combat-related injuries.
He spent a year in the hospital and was later discharged from the
Marine Corps because of his injuries.
Petitioner worked for the U.S. Postal Service from 1980
until he was forced to retire in 1992 as a result of the injuries
he had sustained while serving in Vietnam. During the years
since he was forced to retire, petitioner has received a
retirement annuity from OPM. During some of those years,
petitioners excluded the amount of that annuity from their gross
income. Respondent examined petitioners’ returns for several of
1
All section references are to the Internal Revenue Code in
effect for the year in issue, unless otherwise indicated.
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the years before the year in issue, and each time, respondent
issued a closing letter accepting petitioners’ return as filed.
During 2006, petitioner received retirement income of
$14,796 from OPM. Petitioners did not report any of that income
on their 2006 Federal income tax return. Petitioners contend
that the entire amount is excludable from their gross income
pursuant to section 104(a)(4).
OPINION
Section 104(a)(4) excludes from gross income “amounts
received as a pension, annuity, or similar allowance for personal
injuries or sickness resulting from active service in the Armed
Forces of any country”. Petitioner was forced to retire from the
U.S. Postal Service because of injuries sustained while serving
in the Armed Forces, and he contends that he therefore may
exclude from gross income the amount he receives as a retirement
annuity from OPM.
In Haar v. Commissioner, 78 T.C. 864 (1982), affd. 709 F.2d
1206 (8th Cir. 1983), this Court first addressed the question of
whether an individual who retires from a civilian job because of
a disability resulting from military service and receives
disability payments from that civilian employer may exclude those
payments from his gross income. In Haar, hearing loss sustained
as a result of the taxpayer’s service in the military forced him
to retire from his job as an auditor with the U.S. General
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Services Administration, and he subsequently received annuity
payments from the Civil Service Retirement and Disability Fund.
Although we noted that the ambiguous wording of section 104(a)(4)
provided some superficial support for the taxpayer’s exclusion,
we concluded that the wording was “overshadowed” by the fact that
the disability benefits under the Civil Service Retirement Act, 5
U.S.C. secs. 8331 et seq., were not designed to compensate for
military injuries. Id. at 866. Rather, the cause of the
disability was irrelevant when determining eligibility. Id. at
866-867. We held that, because the disability payments the
taxpayer received were not paid as compensation for personal
injuries or sickness incurred in military service, the taxpayer
was not entitled to exclude the disability payments under section
104(a)(4). Id. at 867.
This Court has consistently followed our holding in Haar in
numerous cases addressing whether various benefit payments under
Civil Service and public employee disability plans were eligible
for exclusion under section 104(a)(4). See Reimels v.
Commissioner, 123 T.C. 245, 249-250 (2004) (and cases cited
thereat), affd. 436 F.3d 344 (2d Cir. 2006). On facts very
similar to those of the instant case, we previously have held
that a taxpayer who contended that he was terminated by the U.S.
Postal Service because of injuries he received while serving in
the Armed Forces was not entitled to exclude Civil Service
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disability retirement payments from his income under section
104(a)(4). See French v. Commissioner, T.C. Memo. 1991-417. As
in French, we similarly conclude that petitioner is not entitled
to exclude the retirement annuity payments he received from OPM
from his gross income under section 104(a)(4).
Petitioner also contends that, because respondent issued
closing letters and accepted petitioners’ returns as filed in
previous years, respondent should be barred from determining a
deficiency for petitioners’ 2006 tax year. However, we have held
that where the Commissioner has overlooked the taxability of
certain items in previous years, he is not barred from taking a
different position in later years. Rose v. Commissioner, 55 T.C.
28, 32 (1970). Additionally, the Commissioner is not bound by a
closing letter he issued for a previous year. See Kiourtsis v.
Commissioner, T.C. Memo. 1996-534 (and cases cited therein).
Consequently, we conclude that respondent is not barred from
determining a deficiency against petitioners for their 2006 tax
year.
In reaching these holdings, we have considered all the
parties’ arguments, and, to the extent not addressed herein, we
conclude that they are moot, irrelevant, or without merit.
To reflect the foregoing,
Decision will be entered
for respondent.