the extent that the statute purported to tax, as income, a recovery for a nonphysical personal injury for mental distress and loss of reputation not received in lieu of taxable income such as lost wages or earnings. Because the August 2006 opinion was vacated, the Court of Appeals did not hear the case en banc. On July 3, 2007, the Court (through the original three-judge panel) ruled (1) that the taxpayer's compensation was received on account of a nonphysical injury or sickness; (2) that gross income under section 61 of the Internal Revenue Code does include compensatory damages for nonphysical injuries, even if the award is not an "accession to wealth", (3) that the income tax imposed on an award for nonphysical injuries is an indirect tax, regardless of whether the recovery is restoration of "human capital", and therefore the tax does not violate the constitutional requirement of Article I, Section 9, Clause 4, that capitations or other direct taxes must be laid among the states only in proportion to the population; (4) that the income tax imposed on an award for nonphysical injuries does not violate the constitutional requirement of Article I, Section 8, Clause 1, that all duties, imposts and excises be uniform throughout the United States; (5) that under the doctrine of sovereign immunity, the Internal Revenue Service may not be sued in its own name. The Court stated that "[a]lthough the 'Congress cannot make a thing income which is not so in fact',... it can label a thing income and tax it, so long as it acts within its constitutional authority, which includes not only the Sixteenth Amendment but also Article I, Sections 8 and9." The court ruled that Ms. Murphy was not entitled to the tax refund she claimed, and that the personal injury award she received was "within the reach of the Congressional power to tax under Article I, Section8 of the Constitution" even if the award was "not income within the meaning of the Sixteenth Amendment". See also the Penn Mutual case cited above. On April 21, 2008, the U.S. Supreme Court declined to review the decision by the Court of Appeals. See also Tax protester Sixteenth Amendment arguments Notes External links Official Transcript of the 16th Amendment Sixteenth Amendment and 1913 tax return form CRS Annotated Constitution: Sixteenth Amendment Pollock Decision Brushaber Decision Stanton Decision Sixteenth Amendment to the United States Constitution