Justia Tax Law Opinion Summaries

Russell Phillips, an employee of the Chicago Central & Pacific Railroad, filed a negligence action against the railroad. The jury returned a general verdict in favor of Phillips, and the district court awarded Phillips damages. The railroad paid Phillips the amount of the judgment but withheld a portion of the award to pay taxes allegedly due under the Railroad Retirement Act (RRTA). Phillips refused to execute a satisfaction of judgment, arguing that the railroad should have withheld any amount for tax purposes. Subsequently, the railroad moved for an order of satisfaction and discharge of judgment. The district court sustained the motion. The Supreme Court affirmed, holding (1) an award for time lost is subject to tax withholding under the RRTA; and (2) the railroad fully satisfied the judgment.View "Phillips v. Chicago Cent. & Pac. R.R. Co." on Justia Law