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Opinion of the Court


provides in relevant part that “gross income does not include_

“(2) the amount of any damages received (whether by suit or agreement and whether as lump sums or as periodic payments) on account of personal injuries or

sickness .. Neither the text nor the legislative history of $ 104(a)(2) offers any explanation of the term “personal injuries. Since 1960, however, IRS regulations formally have linked identification of a personal injury for purposes of $ 104(a)(2) to traditional tort principles: “The term 'damages received (whether by suit or agreement)' means an amount received ... 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.” 26 CFR § 1.1041(c) (1991). See Threlkeld v. Commissioner, 87 T. C. 1294, 1305 (1986) (“The essential element of an exclusion under section 104(a)(2) is that the income involved must derive from some sort of tort claim against the payor. . . . As a result, common law tort law concepts are helpful in deciding whether a taxpayer is being compensated for a “personal injury'”) (internal quotation marks omitted), aff'd, 848 F. 2d 81 (CA6 1988).

A “tort” has been defined broadly as a “civil wrong, other than breach of contract, for which the court will provide a remedy in the form of an action for damages.” See W. Keeton, D. Dobbs, R. Keeton, & D. Owen, Prosser and Keeton on the Law of Torts 2 (1984). Remedial principles thus figure prominently in the definition and conceptualization of torts.

4 Section 104, entitled "Compensation for injuries or sickness,” provides similar exclusions from gross income for amounts received for personal injuries or sickness under worker's compensation programs ($ 104(a)(1)), accident or health insurance ($ 104(a)(3)), and certain federal pension programs (104(a)(4)).

6 See, e. g., H. R. Rep. No. 1337, 83d Cong., 2d Sess., 15 (1954); S. Rep. No. 1622, 83d Cong., 2d Sess., 15-16 (1954).

Opinion of the Court

See R. Heuston, Salmond on the Law of Torts 9 (12th ed. 1957) (noting that "an action for damages” is “an essential characteristic of every true tort,” and that, even where other relief, such as an injunction, may be available, "in all such cases it is solely by virtue of the right to damages that the wrong complained of is to be classed as a tort”). Indeed, one of the hallmarks of traditional tort liability is the availability of a broad range of damages to compensate the plaintiff "fairly for injuries caused by the violation of his legal rights." Carey v. Piphus, 435 U. S. 247, 257 (1978). Although these damages often are described in compensatory terms, see Memphis Community School Dist. v. Stachura, 477 U. S. 299, 306 (1986), in many cases they are larger than the amount necessary to reimburse actual monetary loss sustained or even anticipated by the plaintiff, and thus redress intangible elements of injury that are “deemed important, even though not pecuniary in (their) immediate consequence[s]." D. Dobbs, Law of Remedies 136 (1973). Cf Molzof v. United States, 502 U. S. 301, 306–307 (1992) (compensatory awards that exceed actual loss are not prohibited as “punitive” damages under the Federal Tort Claims Act).

For example, the victim of a physical injury may be permitted, under the relevant state law, to recover damages not only for lost wages, medical expenses, and diminished future earning capacity on account of the injury, but also for emotional distress and pain and suffering. See Dobbs, at 540– 551; Threlkeld v. Commissioner, 87 T. C., at 1300. Similarly, the victim of a “dignitary” or nonphysical tort6 such as defa

6 Although the IRS briefly interpreted $ 104(a)(2)'s statutory predecessor, $213(b)(6) of the Revenue Act of 1918, 40 Stat. 1066, to restrict the scope of personal injuries to physical injuries, see S. 1384, 2 Cum. Bull. 71 (1920) (determining, on basis of statutory text and "history of the legislation” that “it appears more probable ... that the term “personal injuries,' as used therein means physical injuries only"); Knickerbocker, The Income Tax Treatment of Damages, 47 Cornell L. Q. 429, 431 (1962), the courts and the IRS long since have recognized that $ 104(a)(2)'s reference to “personal injuries” encompasses, in accord with common judicial parlance and con

Opinion of the Court

mation may recover not only for any actual pecuniary loss (e. g., loss of business or customers), but for “impairment of reputation and standing in the community, personal humilia

ceptions, see Black's Law Dictionary 786 (6th ed. 1990); 1 S. Speiser, C. Krause, & A. Gans, American Law of Torts 6 (1983), nonphysical injuries to the individual, such as those affecting emotions, reputation, or character, as well. See, e. g., Rickel v. Commissioner, 900 F. 2d 655, 658 (CA3 1990) (noting that “it is judicially well-established that the meaning of ‘personal injuries' in this context encompasses both nonphysical as well as physical injuries"); Roemer v. Commissioner, 716 F. 2d 693, 697 (CA9 1983) (noting that $ 104(a)(2) “says nothing about physical injuries,” and that "[t]he ordinary meaning of a personal injury is not limited to a physical one"); Rev. Rule 85-98, 1985-2 Cum. Bull. 51 (holding that the $ 104(a)(2) exclusion “makes no distinction between physical or emotional injuries"); 1972-2 Cum. Bull. 3, acquiescing in Seay v. Commissioner, 58 T. C. 32, 40 (1972) (holding that damages received for “personal embarrassment,' “mental strain,” and injury to “personal reputation” may be excluded under $ 104(a)(2), and noting prior rulings regarding alienation of affections and defamation). See also B. Bittker & L. Lokken, Federal Taxation of Income, Estates and Gifts 13–11 (2d ed. 1989); Burke & Friel, Tax Treatment of Employment-Related Personal Injury Awards, 50 Mont. L. Rev. 13, 21 (1989).

Congress' 1989 amendment to $ 104(a)(2) provides further support for the notion that “personal injuries” includes physical as well as nonphysical injuries. Congress rejected a bill that would have limited the $ 104(a)(2) exclusion to cases involving “physical injury or physical sickness.” See H. R. Rep. No. 101–247, pp. 1354–1355 (1989) (describing proposed § 11641 of H. R. 3299, 101st Cong., 1st Sess. (1989)). At the same time, Congress amended $ 104(a) to allow the exclusion of punitive damages only in cases involving “physical injury or physical sickness.” Pub. L. 101–239, $ 7641(a), 103 Stat. 2379, 26 U.S. C. $ 104(a) (1988 ed., Supp. I). The enactment of this limited amendment addressing only punitive damages shows that Congress assumed that other damages (i. e., compensatory) would be excluded in cases of both physical and nonphysical injury.

Notwithstanding JUSTICE SCALIA's contention in his separate opinion that the term “personal injuries” must be read as limited to "health”related injuries, see post, at 244, the foregoing authorities establish that $ 104(a)(2) in fact encompasses a broad range of physical and nonphysical injuries to personal interests. JUSTICE SCALIA implicitly acknowledges that the plain meaning of the statutory phrase can support this wellestablished view. See post, at 243-244.

Opinion of the Court

tion, and mental anguish and suffering." Gertz v. Robert Welch, Inc., 418 U. S. 323, 350 (1974). See also Dobbs, at 510-520. Furthermore, punitive or exemplary damages are generally available in those instances where the defendant's misconduct was intentional or reckless. See id., at 204–208; Molzof v. United States, supra.

We thus agree with the Court of Appeals' analysis insofar as it focused, for purposes of $ 104(a)(2), on the nature of the claim underlying respondents' damages award. See 929 F. 2d, at 1121; Threlkeld v. Commissioner, 87 T. C., at 1305. Respondents, for their part, agree that this is the appropriate inquiry, as does the dissent. See Brief for Respondents 9–12; post, at 250. In order to come within the $ 104(a)(2) income exclusion, respondents therefore must show that Title VII, the legal basis for their recovery of backpay, redresses a tort-like personal injury in accord with the foregoing principles. We turn next to this inquiry.


Title VII of the Civil Rights Act of 19648 makes it an unlawful employment practice for an employer “to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of

? The dissent nonetheless contends that we “misapprehen[d] the nature of the inquiry required by $ 104(a)(2) and the IRS regulation” by “[f]ocusing on [the] remedies” available under Title VII. See post, at 249–250. As discussed above, however, the concept of a “tort” is inextricably bound up with remedies-specifically damages actions. Thus, we believe that consideration of the remedies available under Title VII is critical in determining the “nature of the statute” and the “type of claim” brought by respondents for purposes of $ 104(a)(2). See post, at 250.

8 As discussed below, the Civil Rights Act of 1991, Pub. L. 102–166, 105 Stat. 1071, amended Title VII in significant respects. Respondents do not contend that these amendments apply to this case. See Tr. of Oral Arg. 35–36. We therefore examine the law as it existed prior to November 21, 1991, the effective date of the 1991 Act. See Pub. L. 102–166, $ 402(a), 105 Stat. 1099. Unless otherwise indicated, all references are to the "unamended” Title VII.

Opinion of the Court

such individual's race, color, religion, sex, or national origin.” 42 U. S. C. $2000e-2(a)(1). If administrative remedies are unsuccessful, an aggrieved employee may file suit in a district court, $ 2000e-5(f)(1), although the Courts of Appeals have held that Title VII plaintiffs, unlike ordinary tort plaintiffs, are not entitled to a jury trial. See, e.g., Johnson v. Georgia Highway Express, Inc., 417 F. 2d 1122, 1125 (CA5 1969). See also Curtis v. Loether, 415 U. S. 189, 192–193 (1974) (describing availability of jury trials for common-law forms of action); id., at 196–197, n. 13 (citing Title VII cases). If the court finds that the employer has engaged in an unlawful employment practice, it may enjoin the practice and "order such affirmative action as may be appropriate, which may include, but is not limited to, reinstatement or hiring of employees, with or without back pay ... or any other equitable relief as the court deems appropriate.” $2000e-5(g).

It is beyond question that discrimination in employment on the basis of sex, race, or any of the other classifications protected by Title VII is, as respondents argue and this Court consistently has held, an invidious practice that causes grave harm to its victims. See Brief for Respondents 35–39; Griggs v. Duke Power Co., 401 U. S. 424 (1971). The fact that employment discrimination causes harm to individuals does not automatically imply, however, that there exists a tort-like “personal injury" for purposes of federal income tax law.

Indeed, in contrast to the tort remedies for physical and nonphysical injuries discussed above, Title VII does not allow awards for compensatory or punitive damages; instead, it limits available remedies to backpay, injunctions, and other equitable relief. See $2000e-5(g); Patterson V. McLean Credit Union, 491 U. S. 164, 182, n. 4 (1989) (noting that a plaintiff in a Title VII action is “limited to a recovery of backpay"); Great American Fed. Sav. & Loan Assn. V. Novotny, 442 U. S. 366, 374–375 (1979); Sparrow v. Commissioner, 292 U. S. App. D. C. 259, 262–263, 949 F. 2d 434, 437–

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