David C. McDonald - Page 3

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          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.              
          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                   

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