Weber v. Commissioner
This text of 1978 T.C. Memo. 110 (Weber v. Commissioner) is published on Counsel Stack Legal Research, covering United States Tax Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Opinion
MEMORANDUM FINDINGS OF FACT AND OPINION
QUEALY,
| Taxable Year | Deficiency |
| 1973 | $153.75 |
| 1974 | $166.31 |
The issue remaining*406 for decision is whether premiums paid by petitioners to the Allstate Insurance Company for an insurance policy are deductible as amounts paid for medical care insurance under the provisions of section 213. 1
FINDINGS OF FACT
Some of the facts have been stipulated. The stipulation of facts and the exhibits attached thereto are incorporated herein by this reference.
At the time of the filing of the petition herein, Curtis A. and Joyce Weber were husband and wife and resided in Bellevue, Nebraska. Petitioners filed their joint Federal income tax returns for the taxable years 1973 and 1974 with the Internal Revenue Service Center, Ogden, Utah.
During the years in issue, petitioner Curtis A. Weber, hereinafter referred to as petitioner, had a contract of insurance with the Allstate Insurance Company. The annual premium for the insurance contract was $229.00. Coverage A2 of the policy was a "Sickness Income Benefit." The cost allocated to Coverage A2 was $164.85 per year. The balance of the total premium was for accident and death coverage.
Under Coverage A2, Allstate*407 agreed to pay a monthly benefit of $500.00 for each month of the insured's total disability resulting from sickness, beginning on the first day of total disability following a waiting period and continuing with some limitations, for a maximum period of two years. The policy also provided that after total disability existed continuously for 180 days, Allstate would waive any remium for the policy which thereafter became due during a period of total disability for which monthly benefits were payable.
The policy also provided for a limitation of benefits payable to the insured. This limitation provided, in relative part, that if the total monthly benefits received by the insured under all his insurance plans exceeded the greater of the insured's monthly earnings at the time disability commenced or the insured's average montly earnings for the period of two years immediately preceding the disability, Allstate's liability was limited to the proportion that the amount of such monthly earnings or of such average monthly earnings bears to the total amount of monthly benefits under all such coverages upon the insured at the time that disability commences.
The words "total disability,*408 " as defined in the policy, mean disability that continuously prevents the insured from performing the duties of his occupation. The policy further provided that after disability payments were received for two years, "total disability" thereafter means disability that continuously prevents the insured from engaging in any wage-earning occupation of profitable employment for which the insured was or might have become reasonably qualified by education, training or experience.
Respondent contends that no part of the premiums paid to Allstate were paid to obtain insurance covering expenses of medical care. Petitioner contends that the premiums paid under Coverage A2 of the policy constitute insurance for medical care and are therefore deductible under the provisions of section 213.
OPINION
During 1973 and 1974, petitioners paid annual premiums of $229.00 to Allstate Insurance Ocmpany. The premiums were paid to obtain a policy of insurance providing among other coverages, Coverage A2, which was entitled "Sickness Income Benefit." Under Coverage A2, Allstate agreed to pay $500.00 for each month of total disability resulting from sickness commencing while coverage was in force.
*409 Petitioner contends that the premium paid for Coverage A2 is deductible under the provisions of section 213. Respondent contends that Coverage A2 is not insurance for medical care coverage within the meaning of section 213.
Section 213(a) provides for a deduction to certain amounts paid during the taxable year for medical care of the taxpayer, his spouse and dependents. Section 213(e) defines "medical care" to include amounts paid for insurance covering the cost of diagnosis, cure, mitigation, treatment or prevention of disease, or for the purpose of affecting any structure or function of the body.
The present statutory language governing the deductibility of medical care insurance premiums was enacted by Pub. L. No. 89-97, effective for taxable years beginning after December 31, 1966.
Based on a review of the provisions*410 of the policy, it is clear that no part of the $229.00 annual premium is deductible by the petitioner under the provisions of section 213.
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Cite This Page — Counsel Stack
1978 T.C. Memo. 110, 37 T.C.M. 493, 1978 Tax Ct. Memo LEXIS 405, Counsel Stack Legal Research, https://law.counselstack.com/opinion/weber-v-commissioner-tax-1978.