                  T.C. Memo. 2007-179



                UNITED STATES TAX COURT



        DAN R. AND ANN P. KUNZE, Petitioners v.
     COMMISSIONER OF INTERNAL REVENUE, Respondent



Docket No. 8174-04.             Filed July 5, 2007.



     Ps, along with approximately 150 similarly
situated taxpayers, are U.S. persons who earned income
from working in Antarctica. On their Federal income
tax return, Ps excluded income earned during 2000 from
working in Antarctica. R issued a notice of deficiency
for 2000 in which R determined that the income Ps
earned during 2000 from working in Antarctica is not
excludable from income.

     Held: The income Ps earned in Antarctica is not
excludable from income pursuant to I.R.C. sec. 911.
Arnett v. Commissioner, 126 T.C. 89 (2006), affd. 473
F.3d 790 (7th Cir. 2007), followed.
                                 - 2 -

     Larry D. Harvey, for petitioners.

     Randall L. Preheim, for respondent.



                          MEMORANDUM OPINION


     VASQUEZ, Judge:     This case is before the Court on

respondent’s motion for summary judgment pursuant to Rule 121.1

After a concession,2 the sole issue for decision is whether

petitioners can exclude from income wages earned during 2000 from

working in Antarctica.

                              Background

     At the time they filed the petition, petitioners resided in

Lander, Wyoming.   During 2000, petitioners performed services at

McMurdo Station in Ross Island, Antarctica.    On their 2000

Federal income tax return, petitioners excluded wage income

earned and received during 2000 for services performed in

Antarctica.




     1
        Unless otherwise indicated, all Rule references are to
the Tax Court Rules of Practice and Procedure, and all section
references are to the Internal Revenue Code in effect for the
year in issue. Respondent has filed similar motions for summary
judgment in dockets of the similarly situated taxpayers who are
U.S. persons who earned income from working in Antarctica.
     2
        Respondent concedes that no penalty pursuant to sec. 6662
is due from petitioners for 2000.
                                  - 3 -

                               Discussion

I.    Summary Judgment

       Rule 121(a) provides that either party may move for summary

judgment upon all or any part of the legal issues in controversy.

Full or partial summary judgment may be granted only if it is

demonstrated that no genuine issue exists as to any material fact

and that the legal issues presented by the motion may be decided

as a matter of law.      See Rule 121(b); Sundstrand Corp. v.

Commissioner, 98 T.C. 518, 520 (1992), affd. 17 F.3d 965 (7th

Cir. 1994).    We conclude that there is no genuine issue as to any

material fact and that a decision may be rendered as a matter of

law.

II.    In General

       Section 61(a) provides that gross income means all income

from whatever source derived.     Accordingly, citizens of the

United States generally are taxed on income earned outside the

geographical boundaries of the United States unless the income is

specifically excluded from gross income.      Specking v.

Commissioner, 117 T.C. 95, 101-102 (2001), affd. sub nom. Haessly

v. Commissioner, 68 Fed. Appx. 44 (9th Cir. 2003), affd. sub nom.

Umbach v. Commissioner, 357 F.3d 1108 (10th Cir. 2003).

Exclusions from income are construed narrowly, and taxpayers must

bring themselves within the clear scope of the exclusion.        Id.
                                   - 4 -

III.       Section 911

       In Arnett v. Commissioner, 126 T.C. 89, 91-96 (2006) (Arnett

I), affd. 473 F.3d 790 (7th Cir. 2007) (Arnett II), we addressed

the arguments made by the parties herein regarding section 911.

The U.S. Court of Appeals for the Seventh Circuit agreed with our

analysis of section 911 and affirmed our conclusion that

Antarctica is not a “foreign country” pursuant to section 911 and

the regulations thereunder.       Arnett v. Commissioner, 473 F.3d at

799.       We shall not repeat our analysis from Arnett I herein.   We

follow our analysis and holding in Arnett I and the analysis and

holding of the Court of Appeals in Arnett II.3

       3
        In Arnett v. Commissioner, 126 T.C. 89 (2006), affd. 473
F.3d 790 (7th Cir. 2007), we concluded our Opinion with a
citation of sec. 863(d) suggesting that sec. 863(d) provided an
additional reason to rule against the taxpayer. Id. at 96 (“See
also sec. 863(d) (providing that income earned in Antarctica by a
U.S. person is sourced in the United States).”). In Arnett v.
Commissioner, 473 F.3d at 797, the U.S. Court of Appeals for the
Seventh Circuit addressed sec. 863(d) in greater detail, stating:

            At the outset, we think that it is important to
       note that considering Antarctica not to be a “foreign
       country” is compatible with the general statutory
       scheme. Notably, section 911 is found under subtitle
       A, chapter 1, subchapter N of the IRC, which is
       designated “Tax Based on Income from Sources Within or
       Without the United States.” Part I of this subchapter,
       entitled “Source Rules and Other General Rules Relating
       to Foreign Income,” deems any activity in Antarctica to
       be “space or ocean activity.” In turn, the United
       States is designated the source country of income from
       such activity when earned by a citizen of the United
       States. 26 U.S.C. § 863(d). Although this provision
       does not provide a definitive answer as to whether
       Antarctica is a “foreign country,” it supports the
       conclusion that section 911 is not intended to apply to
                                                     (continued...)
                                  - 5 -

IV.   Conclusion

      Accordingly, for the reasons stated in Arnett I, Arnett II,

and herein, we conclude that petitioners cannot exclude from

gross income wages earned during 2000 from working in Antarctica.

      To reflect the foregoing,


                                               An appropriate order and

                                          decision will be entered.




      3
       (...continued)
      income earned for services provided in Antarctica.

We take this opportunity to state our agreement with the Court of
Appeals’ conclusion set forth above. See also HCSC-Laundry v.
United States, 450 U.S. 1, 6 (1981).
