Arthur Appleton, Jr. v. Commissioner of IRS, 430 F. App'x 135

Government of the Virgin Islands challenges the Tax Court's denial of its motion to intervene under Rule 24(b)(2) and Rule 1(b).
Appleton filed a timely Tax Court petition on April 1, 2010 challenging IRS assessments as void due to expiration of the statute of limitations.
Tax code structure: EDP credits under 26 U.S.C. § 934 linked to Virgin Islands income and mirrored to the BIR; IRS audits and assessments follow, raising the statute of limitations issue.
IRS issued deficiency notice on November 25, 2009 despite § 6501(a)’s limitations period and the Government sought intervention to address the limitations issue.
Tax Court denied intervention as a matter of right and allowed amicus brief; Government appealed to the circuit.
Court holds the Government’s intervention should have been permitted under Rule 24(b)(2) and remands to Tax Court for further proceedings.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether permissive intervention under Rule 24(b)(2) was available.	Appleton argued no need for intervention due to redundancy.	Government argued Rule 24(b)(2) permits intervention to protect its interests.	Yes; the Government should be allowed to intervene.
Whether intervention would unduly delay or prejudice the original parties.	Appleton contends intervention would be redundant and cause delay.	Government contends its participation would be complementary and not prejudicial.	No undue delay or prejudice found; intervention permissible.
Whether the Government's interest is sufficiently tied to a statute or regulation administered by the Government.	Government interest stems from protecting the EDP and VI tax structure.	Interest arises from ongoing audits and potential impact on the EDP.	Interest is sufficiently tied to a statute/regulation administered by VI Government.
Whether redundant issues justify denial of intervention.	Intervention would supplement Appleton’s defense and not create undue redundancy.	Intervention risks redundant issues and complicates proceedings.	Redundancy alone does not preclude intervention; delay and prejudice not shown here.

Sampson v. Commissioner, 710 F.2d 262 (6th Cir. 1983) (permits consideration of permissive intervention where interests align and delay is not undue)
Estate of Dixon v. Commissioner, 666 F.2d 386 (9th Cir. 1982) (permits permissive intervention when necessary and not duplicative)
Hoots v. Commonwealth of Pa., 672 F.2d 1133 (3d Cir. 1982) (intervention appropriate when interests are not duplicative and delay is not undue)