United States v. Dorothy R. Garber

*101AINSWORTH, Circuit Judge,

with whom GODBOLD, TJOFLAT and ALVIN B. RUBIN, Circuit Judges, join, dissenting:

This dissent to the majority opinion is made on the basis of two principal issues involved in the trial in district court. The first of these follows.

1) Did the trial judge err in ruling, as a matter of law, that the income derived by defendant Garber was taxable?

The majority’s statement of the facts is fairly complete, but a brief additional review of the evidence taken in light of the jury’s guilty verdict is warranted. Plasmapheresis, the process in which appellant Garber was involved as a blood donor, is painful but does not result in permanent injury, since the body regenerates the removed plasma. Further, it is undisputed that appellant received large amounts of money for her plasma during the taxable years in question and that she did not report these amounts as income. The record demonstrates a continuing escalation in the amount received by appellant for her bleeds. Originally paid $200 per bleed, appellant increased that figure to $1,600 per bleed plus fringe benefits and a weekly salary of $200.

The evidence bearing on her intent to evade taxes is substantial. In her first engagement with Dade Reagents, Inc., appellant was advised by company officials on the tax consequences of her receipts. In accordance with that advice, a savings account was established in appellant’s name for the purpose of creating a fund to cover her income tax liability. One quarter of the money paid for the bleeds was deposited by Dade into the savings account in Garber’s name. Checks from Dade to appellant bore the notation “less accrual for taxes,” that is, for the amount placed in the savings account. Appellant did not pay those funds, accrued for taxes, to the Government, but withdrew them for her personal use. Later, while employed by another company, appellant received a weekly salary which was declared by her as income. Appellant performed no services for the company beyond that as a plasma donor. Defendant Garber testified in her own defense that she did not think the funds were taxable since they were obtained by giving up something from her body. However, appellant was not told by any official of the Internal Revenue Service that the funds were not taxable, nor did she seek IRS advice in that regard. Moreover, appellant never sought any professional advice from a lawyer or an accountant on the taxability of the income.1

The majority opinion does not resolve the issue of whether defendant Garber’s income as a blood donor was taxable but seemingly avoids a clear decision in this regard. It is true that considerable doubt is cast by the opinion on the taxability of the income. If, however, it is the majority’s real view that the income was not taxable, it seems the opinion should say so and dismiss the indictment. However, the conviction is reversed *102and the case remanded for a retrial, a conclusion which thereby impliedly decides that defendant Garber’s income was taxable though it holds that the question of willfulness was not properly submitted to the jury by the district court.

It is our view that defendant Garber’s income was taxable and that Judge Fulton correctly ruled, as a matter of law, that it was. Further, his instruction to the jury that the income was taxable and withdrawal of that issue from the jury was a correct trial ruling.

Unfortunately, under the majority opinion, when the case goes back to Judge Fulton for retrial, he will be unable to tell from the majority opinion whether he correctly ruled that defendant Garber’s income was taxable. The trial court should not be left in such a dilemma.

The primary legal issue involved in this matter is the construction of section 61 of the Internal Revenue Code, the basic provision of which states that “gross income means all income from whatever source derived.” 2 The case law has often considered the reach of section 61 and its statutory predecessors in early versions of the Code. In adopting the income provision of the Code, Congress intended “to use the full measure of its taxing power.” Helvering v. Clifford, 309 U.S. 331, 334, 60 S.Ct. 554, 556, 84 L.Ed. 788 (1940); Blassie v. Commissioner, 8 Cir., 1968, 394 F.2d 628. Accordingly, “Congress applied no limitations as to the source of taxable receipts, nor restrictive labels as to their nature ... to tax all gains except those specifically exempted.” Commissioner v. Kowalski, 434 U.S. 77, 82, 83, 98 S.Ct. 315, 319, 54 L.Ed.2d 252 (1978) (citing Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-30, 75 S.Ct. 473, 476, 90 L.Ed. 483 (1955)). The test to determine if certain receipts constitute income is whether there exist “undeniable accessions to wealth, clearly realized, and over which the taxpayers have complete dominion.” Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431, 75 S.Ct. 473, 477, 99 L.Ed. 483 (1955). See United States v. Allen, 8 Cir., 1977, 551 F.2d 208. This court, in line with Glenshaw Glass, has stated that the key to understanding the term income as used in the Code is whether the receipts reflect “economic gain.” United States v. Gotcher, 5 Cir., 1968, 401 F.2d 118. See United States v. Rochelle, 5 Cir., 1967, 384 F.2d 748, cert. denied, 390 U.S. 946, 88 S.Ct. 1032, 19 L.Ed.2d 1135 (1968).

Given its sweeping language, section 61 must be construed broadly “in accordance with an obvious purpose to tax income comprehensively.” Commissioner v. Jacobson, 336 U.S. 28, 49, 69 S.Ct. 358, 369, 93 L.Ed. 477 (1949). See Commissioner v. Smith, 324 U.S. 177, 181, 65 S.Ct. 591, 593, 89 L.Ed. 830 (1945); Ritter v. United States, 393 F.2d 823, 826-27, 183 Ct.Cl. 875, cert. denied, 393 U.S. 844, 89 S.Ct. 127, 21 L.Ed.2d 115 (1968). It is recognized that section 61 is especially flexible since the concept of income must necessarily be adapted to changing circumstances.

The term “income” is particularly open to the well-known statement of the Court that:
A word is not a crystal, transparent and unchanged; it is the skin of a living thought and may vary greatly in color and content according to the circumstances and the time in which it is used.
[T]he Supreme Court . [has expressed] . . . the flexible attitude that the term “income” is to be given a broad meaning.

1 Mertens, Law of Federal Income Taxation, § 5.03, ch. 5, p. 5 (citing Towne v. Eisner, 245 U.S. 418, 425, 38 S.Ct. 158, 159, 62 L.Ed. 372 (1918)) (footnotes omitted). The legal principle governing the meaning of income as used in section 61 is thus well established.

*103The above cases provide ample support for upholding Judge Fulton’s decision that appellant’s receipt of money in payment for her plasma was taxable income under section 61. While not addressing the precise fact situation presented here, they establish a working definition of income that is both comprehensive and broad. Nevertheless, the majority concludes that the reasoning which supports the taxability of the income is “without clear precedential support in the law.” The definition of taxable income is well established, and the income in this case falls within the confines of the income definition enunciated in Glenshaw Glass. Undeniably, the funds represented an accession to wealth for appellant’s economic benefit. The money was definitely realized; there is no issue as to the fact that the funds were received. Appellant had total control over the use of the money. The payments were not loans. The amount and value of the funds is uncontroverted; this is not a case where the taxpayer has received something of uncertain value. Thus, the applicable principles stated in the Supreme Court and Fifth Circuit decisions clearly establish that the funds were for appellant’s economic benefit and accordingly constituted taxable income under the provisions of section 61.

The majority suggests that considerable doubt exists about the tax consequences of the income because the money could be considered as having been received in return for the sale of a product. “[Bjlood plasma, like a chicken’s eggs, a sheep’s wool, or like any salable part of the human body, is a tangible property which in this case commanded a selling price dependent on its value.” 607 F.2d at 97. If her plasma is treated as a product, appellant is entitled to deduct her cost basis in the plasma from her gross receipts in order to determine her taxable income. Yet, the distinction between an exchange for services and the sale of a product is only significant if defendant has a substantial basis in her plasma. If the basis is zero or minimal, then virtually all of the funds would be gain and hence taxable.3

Neither the appellant nor the majority has persuasively shown that appellant had anything but a zero basis in her plasma.4 *104The majority suggests that appellant may have had a basis equal to the money received for the plasma. But none of the cases cited for this proposition are in point. For example, in United States v. Davis, 370 U.S. 65, 82 S.Ct. 1190, 8 L.Ed.2d 335 (1962), cited by the majority, a husband, pursuant to a property settlement agreement executed prior to a divorce, exchanged certain properties for his wife’s release of her inchoate marital rights. At issue was whether the husband was required to realize the gain on the properties exchanged. The Court held that since the transaction was conducted at arm’s length, the indeterminate value of the wife’s marital rights was no bar to taxing the husband’s exchange. The marital rights were deemed to be equal in value to the market value of the property received by the wife. As a result, the husband paid tax on the excess of market value over his original cost basis. Accordingly, the wife received a basis equal to the market value of the property since the husband had already been taxed on the appreciation over his original basis. There is no valuation issue in the instant case. As has long been recognized, Davis is a valuation case whose principles are most useful when no market exists for the product or item being exchanged. See Bar L Ranch, Inc. v. Phinney, 5 Cir., 1970, 426 F.2d 995; Seas Shipping Co. v. Commissioner, 2 Cir., 371 F.2d 528, cert. denied, 387 U.S. 943, 87 S.Ct. 2076, 18 L.Ed.2d 1330 (1967). However, the value of the plasma here is equal to the money paid for it to appellant.

This case contains none of the characteristics of Davis or the other cases cited by the majority.5 The only explanation for the majority’s allegiance to them is a misunderstanding between the concepts of value and basis. Basis, as defined in section 1012 of the Internal Revenue Code, is equal to “the cost of such property . . . .” Value, on the other hand, is set by the market. Gain is the difference between that value realized in a sale, and the cost basis of the property. Uniqueness is not ground for a tax exemption and the fact that appellant may be one of only a few persons with valuable plasma does not entitle her to immunity from payment of taxes on the large and substantial amounts paid to her each year. Her basis in the plasma is the cost of its constituent parts, which in this case is zero.

Our conclusion is reinforced by a number of cases holding that the burden of proving setoffs to income either in the form of expense deductions or cost basis adjustments is on the defendant. See, e. g., Siravo v. United States, 1 Cir., 1967, 377 F.2d 469, 473 (“evidence of unexplained receipts shifts to the taxpayer the burden of coming forward with evidence as to the amount of offsetting expenses, if any”); United States v. Stayback, 3 Cir., 1954, 212 F.2d 313 (no burden on government to prove defendant’s cost basis in the goods sold), cert. denied, 348 U.S. 911, 75 S.Ct. 289, 99 L.Ed. 714 (1955); United States v. Hornstein, 7 Cir., *1051949, 176 F.2d 217, 220 (same). See Burnet v. Houston, 283 U.S. 223, 227-28, 51 S.Ct. 413, 415, 75 L.Ed. 991 (1931). Indeed, this court, in United States v. Hiett, 5 Cir., 1978, 581 F.2d 1199, 1202, stated in an analogous context that, “[i]n a prosecution for income tax evasion, once the government has established the defendant’s unreported income ., it is not then required to prove that the defendant has no other deductions. The burden of proving additional deductions is on the defendant.” See McClanahan v. United States, 5 Cir., 1961, 292 F.2d 630 (gambler must prove any offsetting gambling losses). In the present action, appellant has made no attempt whatever to demonstrate any ascertainable basis in her plasma, preferring to rely on the fallacious theory that her basis is hopelessly uncertain.6

The majority’s holding is also unwise as a practical matter given the likely result of requiring the jury to consider the state of the law. “Obviously, it would be most confusing to a jury to have legal material introduced as evidence and then argued as to what the law is or ought to be.” Cooley v. United States, 9 Cir., 1974, 501 F.2d 1249, 1254, cert, denied, 419 U.S. 1123, 95 S.Ct. 809, 42 L.Ed.2d 824 (1975). The jury is not composed of lawyers; the typical juror is untrained in legal affairs. To attempt to explain the myriad rules of judicial construction, the complexity of legal principles, or the function of precedent would hopelessly divert the jury from their preeminent duty of assessing appellant’s guilt.

The second principal issue follows.

2) Did the trial judge properly submit the question of willfulness to the jury?

On the issue of willfulness, we first consider whether the trial judge erred in declining to permit the proffered testimony of defendant Garber’s so-called expert Nall to go to the jury. The majority argues strenuously that this was probably the most serious of the errors committed in the trial since Nall’s testimony would have shown that the law was so uncertain as to whether defendant Garber’s income was taxable that she could not have had criminal intent to evade payment of taxes.

Our view is that receipt of opinion testimony of this kind as to pure issues of law invades the province of the district court. It is the trial judge who must make rulings on the law involved in the case, and boilerplate jury instructions have since time immemorial stated that the jury takes the law only from the court. Now a new rule is attempted by the majority which in effect states that the jury must take its instructions on the law from expert witnesses as well as the trial judge.

The majority’s views concerning the admissibility of the proffered expert testimony is in conflict with existing precedent. Initially we point out that the district court *106has “broad discretion in the matter of the admission or exclusion of expert evidence, and his action is to be sustained unless manifestly erroneous.” Salem v. United States Lines Co., 370 U.S. 31, 35, 82 S.Ct. 1119, 1122, 8 L.Ed.2d 313 (1962). See Perkins v. Volkswagen of America, Inc., 5 Cir., 1979, 596 F.2d 681. The purpose of expert testimony is to “assist the trier of fact to understand the evidence or to determine a fact in issue . . . .” Fed.R.Evid. 702. The expert’s testimony here involved a question of law properly reserved for the court’s decision. Since there was no showing that appellant had consulted the expert or relied on his view, or views of any other accountant or lawyer, the testimony was unrelated to a determination of defendant’s intent or willfulness.

Of course, a defendant is “entitled to wide latitude in the introduction of evidence tending to show lack of intent.” 607 F.2d at 99. But the cases cited by the majority for this principle do not support the proposition that evidence unrelated to appellant’s actual intent should be admitted. Indeed, the cases are to the contrary. See, e. g., United States v. Brown, 10 Cir., 1969, 411 F.2d 1134, 1137 (transcript of unavailable witness should have been admitted despite minor hearsay objection since theory of defendant’s defense was reliance upon that witness’ representations); Miller v. United States, 10 Cir., 1941, 120 F.2d 968, 970 (defendant may buttress personal statements of no intent “with testimony of relevant circumstances, including conversations had with third persons or statements made by them, tending to support his statement that he had no intent to defraud”); Petersen v. United States, 10 Cir., 1959, 268 F.2d 87 (when relying on lack of willfulness, defendant is entitled to character witnesses and proper instructions since character of defendant is directly at issue). The expert’s testimony on the state of the law does not explain any of appellant’s actions in this case and thus is not directly relevant to her actual intent or character. Thus, the evidence does not fall under the principles in those cases cited by the majority.

Indeed, other precedent directly supports the inadmissibility of the expert’s testimony on the law. The question should be controlled by this court’s decision in White v. United States, 5 Cir., 1954, 216 F.2d 1. In White, the trial judge refused to allow the defendant’s experts to testify that certain funds should be treated as capital gains rather than ordinary income as the Government argued. On appeal, the court held that the testimony was properly excluded since the defendant had not relied upon the expert’s opinion. “[T]he defendant not having acted in accordance with the witness’ opinion and hence that opinion not being relevant on the question of intention, we think that the opinion of the witness as to the law of the case could not be substituted for that of the court . . . .” Id. at 5. Cf. United States v. Caserta, 3 Cir., 1952, 199 F.2d 905, 909 (where the purpose of expert testimony is “criticism of the government’s legal theory,” such evidence should be excluded).

The White decision is supported by precedents from other circuits. In Cooley v. United States, 9 Cir., 1974, 501 F.2d 1249, cert. denied, 419 U.S. 1123, 95 S.Ct. 809, 42 L.Ed.2d 824 (1975), defendant attempted to introduce into evidence a number of legal documents, including Supreme Court opinions, which allegedly supported his position that he had not acted willfully. The trial judge excluded the evidence, and on appeal the Ninth Circuit agreed. Since the defendant was not attempting to show that he had relied on those legal documents, the Court held that the “offered material was immaterial and should not have been admitted as evidence. In the orderly trial of a case, the law is given to the jury by the court and not introduced as evidence.” 501 F.2d at 1253. Similarly, in Lisansky v. United States, 4 Cir., 31 F.2d 846, cert. denied, 279 U.S. 873, 49 S.Ct. 514, 73 L.Ed. 1008 (1929), the trial court excluded evidence from the defendant’s expert witness that purported to demonstrate that profits from certain loans should not be taken into income until the loans themselves were repaid. The Fourth Circuit upheld the trial court’s action by finding that the testimony *107on the taxability involved a question of law reserved for the judge.

By the same experts, defendants offered to prove that in their opinion, based upon the decisions of the Revenue Department and of the courts as they understood them, it was proper for defendants not to report profits realized upon usurious loans until the loans themselves had been repaid. This also was properly excluded. The witnesses did not propose to testify that they advised defendants not to report these profits, nor did defendants testify that they relied upon the opinion of the experts in failing to report the same. What was required to be reported as income was a matter of law to be covered by the charge of the court, not by the testimony of experts.

31 F.2d at 851. Thus, under existing precedents it is clear that the inherent confusion which would result from receipt of expert testimony on the state of the law precludes such testimony where the defendant’s actual reliance on the expert opinion is not involved.7

We next point out that the majority’s view concerning the supposed impropriety of the judge’s instruction on willfulness is similarly mistaken. An examination of the relevant authority relied upon by the majority demonstrates that those cases are not applicable in the circumstances here. Morissette v. United States, 342 U.S. 246, 72 S.Ct. 240, 96 L.Ed. 288 (1952), involved a defendant who had taken bomb casings from government property thinking that they were abandoned scrap. The trial court ruled that the defendant had conclusively demonstrated the requisite intent merely by taking the casings. Thus, the defendant was unable to argue that he had a good faith belief that the casings were abandoned by the Government and the question of intent was taken away from the jury. In reversing the conviction, the Supreme Court held that the matter of intent was a question of fact which must be submitted to the jury. Similarly, in Mann v. United States, 5 Cir., 1963, 319 F.2d 404, cert. denied, 375 U.S. 986, 84 S.Ct. 520, 11 L.Ed.2d 474 (1964), the trial judge instructed the jury that an actor intends the natural and probable consequences of his acts. The court held that the result of this instruction was that the jury was essentially told that it could presume intent from the mere fact that an incorrect tax return had been filed. We held that it was “error to give a charge in a criminal case of this nature, the overall effect of which is to place a burden upon the defendant to produce evidence to overcome a presumption of guilt.” 319 F.2d at 410. See Wardlaw v. United States, 5 Cir., 1953, 203 F.2d 884, 887 (instruction permitting presumption of intent held erroneous since effect was “to impress the jury with the belief that there was no good faith defense”). Cf. United States v. Tadio, 2 Cir., 223 F.2d 759 (asserting that it was error for trial court to instruct jury that particular accounting technique was unjustified, but upholding conviction since the overall instruction on intent clearly indicated that it was the Government’s duty to demonstrate intent), cert. denied, 350 U.S. 874, 76 S.Ct. 119, 100 L.Ed. 772 (1955). In summary, the cases cited by the majority stand for the proposition that the trial judge may not refuse the defense of lack of intent or hinder its usefulness by creating a *108presumption which lowers the Government’s burden of proof. The jury must be instructed that it is a defense to the charge if the defendant acted with a good faith belief in the propriety of his or her conduct.

The district judge in this case did not hamper appellant’s right to a defense based upon her lack of criminal intent and he properly stated the applicable law. Cf. United States v. Callahan, 5 Cir., 1979, 588 F.2d 1078. The judge made clear that it was the jury’s responsibility to determine intent from its consideration of all the evidence. He instructed that the appellant could not be convicted if her actions were “not voluntary and intentional on her part but [were] the result of a mistake or inadvertence or some other innocent reason. . ” Thus, the good faith defense was not taken from the appellant as in Morissette. Furthermore, the judge did not create any presumptions which lowered the Government’s burden of proof. Cf. Mann v. United States, supra, 319 F.2d 404. On the crucial issue of the relationship between the taxability of the income and the issue of appellant’s willfulness, the trial judge made it absolutely clear that his ruling that the income was taxable in no way affected the jury’s responsibility for determining intent. Directly after instructing that the income was taxable, the trial judge stated:

Whether the defendant wilfully and intentionally attempted to evade and defeat her income tax is a fact question which must be determined by the jury.
You are instructed that if a person in good faith believes that she has filed a correct tax return, she cannot be guilty of criminal intent to evade the tax law; but if a person acts without any ground for belief that her conduct is lawful, it is for the jury to decide whether she acted in good faith or whether she wilfully intended to evade her tax. This issue of whether the defendant wilfully attempted to evade her tax is one which the jury must determine from all of the evidence in the case which bears upon the defendant’s state of mind at the time in question.

Thus, the jury was explicitly and correctly informed that regardless of the taxability of the income, the question of willfulness was solely their responsibility to be determined from the totality of the circumstances.

The majority somehow reads this instruction as creating an impression in the minds of the jury that appellant had simply refused to pay a tax clearly owed. This observation is unfounded. Appellant’s testimony that she did not think the income to be taxable was still before the jury and represented the primary basis of her defense. Moreover, the judge had not cast any aspersions on appellant’s character by instructing the jury that the income was taxable. As the trial judge instructed:

Now, during the trial of this case, there has been some evidence upon the issue of whether a blood plasma donor for pay is required to include monies thus received in a federal income tax return of the taxpayer. That issue involves an interpretation of the Internal Revenue Code and is, therefore, an issue of law for the Court and not an issue of fact for the jury-
Having considered this issue of law, the Court has determined and instructs you that any monies paid to the defendant in exchange for her blood plasma constitutes gross income, and, as such, is subject to federal income taxation.

His statement to the jury was direct and devoid of any excess or gratuitous remarks which may have implied guilt or misbehavior on the part of the appellant. The only interpretation possible from the instruction was there had been debate over a legal issue which the judge resolved in favor of the Government. It is clear that the jury was independently to assess the existence of willfulness. Certainly, this situation is not unique in tax evasion cases. Without taxable income, there would be no prosecution. Thus, the majority’s point proves too much; most cases necessarily involve a situation where the taxability of the funds is “clear” to the jury and stated to be so by the court with the primary issue being whether the *109defendant received those funds and possessed the requisite intent. In summary, the trial judge’s instructions stated the law properly and gave appellant every right to a good faith defense.

We believe the original panel opinion in this case which affirmed defendant Garber’s conviction was correct and for the reasons there expressed and expanded here. No valid reason has been shown to change that result.

. As we said in the panel opinion:

Joseph N. Potts, a former Dade superintendent, testified at trial that, when appellant first began selling blood plasma to Dade, he wanted her to be informed concerning the taxability of the payments made to her. A memorandum dealing with taxation was prepared for Garber, and Potts discussed the matter with her in his office. At Dade’s suggestion a savings account was opened in Garber’s name in which Dade was to deposit a portion of the payments to her so there would be funds available to pay income taxes. Dade made deposits in this account from 1967 to 1969 and the statements of earnings accompanying the checks issued to Garber during this period bore the notation “less accrual for taxes.” She did not, however, pay the money in the account to the Government but gradually withdrew it for a variety of personal uses. Appellant testified at trial that she did not recall Potts telling her anything about taxes and, although she remembered the savings account, she stated that she did not recall that the account was for taxes or that the statements were marked “less accrual for taxes.” She also testified that she filed a return for the 1969 tax year on which she had written: “I have no W-2 forms as my income was made up entirely from donating blood plasma from various blood banks.” An employee of the IRS District Director’s Office, however, later testified that the IRS had no record of a return for 1969 having been filed.

589 F.2d at 845-46.

. In pertinent part, 26 U.S.C. § 61(a) reads:

Except as otherwise provided in this subtitle, gross income means all income from whatever source derived, including (but not limited to) the following items:
(1) Compensation for services, including fees, commissions, and similar items;
(2) Gross income derived from business;
(3) Gains derived from dealings in property:

. Appellant may be entitled to deduct the cost .of any special incidental expenses which she required to promote plasma regeneration such as vitamins. There is no evidence, however, suggesting that such incidental expense would offset anything more than an insignificant proportion of her total receipts. The possible existence of a minimal basis in her plasma is irrelevant since the Government need not prove the amount of tax due with mathematical precision, but need only show that a substantial tax is owing. See, e. g., United States v. Miller, 9 Cir., 1976, 545 F.2d 1204, cert. denied, 430 U.S. 930, 97 S.Ct. 1549, 51 L.Ed.2d 774 (1977); United States v. Allen, 6 Cir., 1975, 522 F.2d 1229, cert. denied, 423 U.S. 1072, 96 S.Ct. 854, 47 L.Ed.2d 82 (1976). Since the amount of tax owing under either the personal service or sale of a product theory is essentially the same, testimony concerning which theory is in fact proper in this case is irrelevant and would serve only to confuse the jury. Cf. White v. United States, 5 Cir., 1954, 216 F.2d 1, 4-5 (expert testimony whether income should be considered capital gain or ordinary income irrelevant since substantial tax would still be owing, and thus “defendant’s guilt or innocence” would be unaffected).

. Actually, appellant’s primary argument has been that the income should be excluded from income by virtue of the operation of 26 U.S.C. § 104(a)(2) which permits a taxpayer to exclude “the amount of any damages received (whether by suit or agreement) on account of personal injuries or sickness.” The majority, finding that a reversal was justified on other grounds, failed to address the section 104 issue. It is clear, however, that the provision does not apply to this case. The focus of section 104 pertains to funds received from tort claims. See 26 C.F.R. § 1.104-1(c) (1978) (damages as used in section 104 means “an amount received (other than workmen’s compensation) through prosecution of a legal suit or action based upon tort or tort type rights, or through a settlement agreement entered into in lieu of such prosecution.”) Federal courts have uniformly assumed that the section 104 exclusion applies only to payments resulting from the prosecution or settlement of tort claims. See, e. g., Knuckles v. Commissioner, 10 Cir., 1965, 349 F.2d 610; Agar v. Commissioner, 2 Cir., 1961, 290 F.2d 283. The touchstone of the exclusion is the notion that the funds received represent a restoration of funds rather than an accession to wealth. Starrels v. Commissioner, 9 Cir., 1962, 304 F.2d 574, 576. In this case, there is no evidence that any tort or tort-related claim is involved. To be sure, appellant suffered from pain and discomfort associated with the proc*104ess. Yet, appellant chose to earn a living in this fashion and consented to the process, thus restricting the application of section 104. Cf. Starrels v. Commissioner, supra, 304 F.2d at 576. Thus, the funds were not excludable under section 104. Judge Clark conceded as much in his dissent to the original panel decision. See 589 F.2d at 849.

. The majority’s reliance on Raytheon Production Corp. v. Commissioner, 1 Cir., 144 F.2d 110, cert. denied, 323 U.S. 779, 65 S.Ct. 192, 89 L.Ed. 622 (1944), is especially misplaced. At issue in Raytheon was whether the money paid for settlement of an antitrust suit represented compensation for lost profits or for lost capital, i. e., Raytheon’s goodwill in the injured business. The First Circuit held that the entire recovery in the case was taxable despite the inability of the taxpayer to ascertain whatever basis may have existed in the goodwill lost. See generally Messer v. Commissioner, 3 Cir., 1971, 438 F.2d 774, 780. The dicta quoted by the majority, given the holding that the funds were taxable, thus occurred in a totally dissimilar factual pattern involving the dynamics of the settlement process. Here, there is no doubt concerning the source of the funds or the reasons why appellant received them. On the other hand, Raytheon involved a situation where the origin of the receipts was the primary question in the case. Thus, the situations are not at all similar, and the majority’s use of Raytheon is difficult to fathom, except that it contains language, albeit dicta, that loosely speaks to the question presented here in a most indirect and imprecise manner.

. The majority’s reliance on United States v. Critzer, 4 Cir., 1974, 498 F.2d 1160, and James v. United States, 366 U.S. 213, 81 S.Ct. 1052, 6 L.Ed.2d 246 (1961), for their view that appellant is entitled to a reversal is misplaced. Critzer involved the conviction of an Eastern Cherokee Indian for failing to report income from a business conducted on the Eastern Cherokee Reservation. The tax question was inordinately complex and required the construction of a 1924 statute which provided that the Reservation’s property would be exempt from taxation. The question thus involved whether the business operations constituted income directly related to the property. The case law was obscure, although it generally favored the defendant. Moreover, the Bureau of Indian Affairs had advised the defendant on two separate occasions that the receipts were tax exempt. Indeed, the Department of Interior maintained at the time of trial that the monies were not taxable. The Fourth Circuit found that, as a matter of law, defendant was entitled to an acquittal since the taxability was “so uncertain that even co-ordinate branches of the United States Government plausibly reach directly opposing conclusions.” Critzer, 498 F.2d at 1162. In James, the genesis of the controversy was the Court’s earlier holding in Commissioner v. Wilcox, 327 U.S. 404, 66 S.Ct. 546, 90 L.Ed. 752 (1946), wherein the Court held embezzled funds to be tax exempt. Wilcox was undercut, but not explicitly overruled in Rutkin v. United States, 343 U.S. 130, 72 S.Ct. 571, 96 L.Ed. 833 (1952). The defendant in James had received embezzled funds and as a result fell into the legal abyss of uncertainty created by the two contradictory Supreme Court opinions. In James, the Court explicitly overruled Wilcox, but the conviction for willful evasion was reversed.

. A brief review of the testimony offered by appellant’s expert demonstrates the extreme risk of confusion which would likely occur if introduced to the jury. The expert was not a lawyer, although he was an accountant with some experience in the Internal Revenue Service. In summary, his testimony was vague, and the only direct legal precedent offered involved personal injury cases and other allegedly analogous situations. The precedent cited is relatively old by tax law standards; most are from the beginning years of income tax adjudication. These materials are connected with the evolution of section 104 and thus only marginally related to the legal confusion the majority seemed to find since they left open the section 104 issue. Noticeably absent from the so-called expert’s testimony is any mention of the host of more recent Supreme Court opinions construing section 61 broadly to reach any and all accession to wealth. Thus, the proffered testimony is at best a legal jumble whose introduction would in no way serve to edify the jury as to the issue of uncertainty which the majority addressed.