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Abstract

The Internal Revenue Code enacted in 1954 has continued the 1939 Code provision of law that damages received, whether by suit or agreement, for personal injuries or sickness, are exempt from the Federal income taxation, by providing that such awards are specific exclusions from gross income. In light of this, many defense attorneys engaged in suits of such nature are asking the courts to instruct the jury of such provision, or in their closing arguments mentioning the same. The introduction of the provision in closing arguments has been the cause of many appeals and subsequent reversals due to prejudicial error.

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