Gang v. United States

MEMORANDUM OPINION AND ORDER

ILANA DIAMOND ROVNER, District Judge.

I. INTRODUCTION

This case presents a novel question of federal tax law involving the effective date of a congressional amendment to a statute that penalizes the setting up of a fraudulent tax shelter. On August 31, 1987, the Internal Revenue Service (“IRS” or “Commissioner”) assessed a $391,500 penalty against plaintiff Gabrielle Gang (“Gang”) pursuant to 26 U.S.C. § 6700 for promoting an abusive tax shelter. Subsequently, Gang commenced this refund suit in federal court raising numerous issues regarding the penalty.

Section 6700…