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old section 931 on which petitioner is relying provided that the
term “possession of the United States” included Johnston Island.5
Section 1272(a) of the TRA 1986 amended old section 931 to
exclude from income, in the case of an individual who is a bona
fide resident of a “specified possession” during the entire
taxable year, gross income derived from sources within any such
“specified possession”. Section 931, as amended by section
1272(a) of the TRA 1986 and as in effect for the year at issue
here, defines the term “specified possession” to mean only Guam,
American Samoa, and the Northern Mariana Islands. Sec. 931(c).
In Specking v. Commissioner, 117 T.C. 95 (2001), affd. sub
nom. Haessly v. Commissioner, __ Fed. Appx. __ (9th Cir., June
16, 2003), we addressed the precise argument under section 1.931-
1, Income Tax Regs., that petitioner advances in the instant
case. We concluded in Specking:
Petitioners’ reliance on section 1.931-1, Income
Tax Regs., is misplaced. The regulatory language on
which petitioners rely defines the term “possession”
for purposes of old section 931. As we have concluded
above, that provision no longer applies to petitioners.
Consequently, the regulatory provision also has no
5Sec. 1.931-1, Income Tax Regs., provided in pertinent part:
� 1.931-1. Citizens of the United States and domestic
corporations deriving income from sources within a
possession of the United States.--(a) Definitions.--
(1) As used in section 931 and this section, the term
“possession of the United States” includes American
Samoa, Guam, Johnston Island, Midway Islands, the
Panama Canal Zone, Puerto Rico, and Wake Island. * * *
[Emphasis added.]
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