In the case of Commissioner of Internal Revenue v. Acker, 1959, the U.S Supreme Court ruled on whether retired federal judges should pay income tax on their retirement benefits. The court held that these benefits were not subject to taxation under Section 22(a) of the Internal Revenue Code because they constituted "compensation" for services rendered and thus fell within an exception in Section 22(b)(5). This decision was based on a constitutional principle that protects judicial independence by prohibiting any reduction in judges' compensation while they are in office. The majority opinion reasoned that this protection extends to retirement benefits since those are part of the total compensation package promised to judges when they take office. Therefore, taxing such benefits would effectively reduce a judge's compensation contrary to this constitutional safeguard.

In the dissenting opinion for Commissioner of Internal Revenue v. Acker, Justice Brennan disagreed with the majority's interpretation of Section 22(k) of the Internal Revenue Code. He argued that alimony payments should be considered taxable income to the recipient and deductible by the payer only if they are made in cash or its equivalent, not when paid as property settlements. According to him, Congress intended this provision to apply only where there is a clear economic benefit received by one spouse at an economic cost to another; it was not meant to cover situations where marital assets are merely divided between spouses upon divorce. Therefore, he believed that non-cash transfers such as property settlements should not qualify under Section 22(k). This interpretation would prevent potential abuses and manipulations in tax liabilities following divorces.