here - Fuerst Ittleman David & Joseph, PL

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Case: 11-1612 Document: 003110561288 Page: 32 Date Filed: 06/13/2011 level (those that made less than $75,000 and resided and filed in the USVI have the benefit of the statute of limitations versus that that made more than $75,000 who do not). What is important to note, is that neither place of residence nor income level has ever been a reason to provide that the statute of limitations applies, or does not apply, to a particular taxpayer. There is nothing in the Internal Revenue Code, the Treasury Regulations thereunder, or the Congressional Record that advances such a theory. Additionally, the term ―covered person‖ is never mentioned in the Internal Revenue Code. The term ―covered person‖ was created without any grant of authority by the IRS, and without any notice to the public or comment period. Further the monetary level, i.e., the $75,000, appears to be an arbitrary number used to target those individuals with sufficient wherewithal to make an IRS audit economically feasible. In other words, as the majority of the USVI population lives at or below the poverty line, by setting the bar well above the poverty line those poorly-healed residents will be given the statutory right of having the statute of limitations period under IRC § 6501 apply to them. On the other hand, those well-healed residents, many of which participated in the EDP, would not be afforded the protections of IRC § 6501. Although not explicitly named, Mr. Gangi FUERST ITTLEMAN, PL 1001 BRICKELL BAY DRIVE, 32 ND FLOOR, MIAMI, FL 33131 • T: 305.350.5690 • F: 305.371.8989 • WWW.FUERSTLAW.COM 24 | P a g e
Case: 11-1612 Document: 003110561288 Page: 33 Date Filed: 06/13/2011 has in fact been singled out as a discrete subset of taxpayers for improper treatment by the IRS. Further, the fact that the IRS and the USVI had subsequently entered into an exchange of information agreement, and the fact that the IRS finally issued Treasury Regulations, e.g. Treas. Reg. § 1.932-1(c)(2)(ii) (see also Notice 2007-31 (discussing working arrangement between the IRS and the BIR)), is of no moment. For taxpayers such as Mr. Gangi, the failure of the BIR and/or the IRS to properly exchange information is of no fault of his making. Indeed if there is any blame to be had it falls on the shoulders of the respective governments. Mr. Gangi should not have to bear the burdens of the governments‘ shortcomings, and moreover, the respective governments‘ shortcoming cannot be used to excuse unconstitutional conduct. Accordingly, the District Court erred in concluding that there was no abuse of the District Court‘s process and erred in enforcing the IRS summonses. B. INSTITUTIONAL BAD FAITH The District Court also erred in its determination that there was no institutional bad faith on the part of the IRS. Institutional bad faith is evidenced in Ms. Nina Olsen‘s (the IRS Taxpayer Advocate) 2009 annual report to Congress. Taxpayer Advocate Service, 2009 Annual Report to Congress, Vol. I, Legislative Recommendation No. 10. Doc. # 1-6; A-000084. The 2009 report to Congress FUERST ITTLEMAN, PL 1001 BRICKELL BAY DRIVE, 32 ND FLOOR, MIAMI, FL 33131 • T: 305.350.5690 • F: 305.371.8989 • WWW.FUERSTLAW.COM 25 | P a g e
Page 1 and 2: Case: 11-1612 Document: 00311056128
Page 3 and 4: CONCLUSION……………………
Page 7 and 8: 26 U.S.C. (IRC) § 6501…………
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Page 47 and 48: Case Case: 3:10-mc-00024-GEB 11-161
Page 55 and 56: Case 3:10-mc-00024-GEB Case: 11-161

here - Fuerst Ittleman David & Joseph, PL

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