In my prior post, I discussed how the IRS has flouted the Administrative Procedure Act in issuing proposed regulations regarding tax-motivated “fee waiver” transactions undertaken by private equity firms. Although the IRS has long disregarded the democratic safeguards otherwise assured by the APA, it has generally faced little consequences for its actions. For example, tax […]

In my previous post, I briefly discussed how the IRS has short-circuited the APA’s notice and comment rulemaking procedures to combat tax motivated transactions by private equity firms. I’d like to further flesh out that point here. Given the general readership of this blog, I’ll start by considering a hypothetical environmental statute and then turn […]

Earlier this week, the IRS issued regulations related to private equity “fee waiver” transactions, which are designed to convert high-taxed ordinary income into low-taxed capital gain. At first, I was pleasantly surprised by the IRS’s method of rulemaking here. Usually, when it issues regulations, the IRS announces that the APA does not apply, and it […]

In 1992, the IRS issued proposed regulations designed to combat a tax strategy used by the May Department Stores Company. Although the regulations were not immediately effective, the IRS announced that it when it finalized them, the regulations would apply retroactively to 1989. Consequently, some taxpayers took the proposed regulations into account in structuring their […]

As has been discussed on this blog and elsewhere, Chief Justice Roberts’ majority opinion in King v. Burwell rejected the application of Chevron deference for the IRS’s construction of Section 36B. The meaning of the phrase “established by the State” was not something for the IRS to determine, because “had Congress wished to assign that […]

Today, the Supreme Court issued its much-anticipated decision in King v. Burwell, holding that the Section 36B premium tax credit extends to taxpayers who acquire healthcare policies on federally established exchanges. The decision probably will not bear much on core tax provisions, but the Court’s reasoning could have major implications for the IRS’s administration of the […]

In my prior posts and in a prior article, I’ve explained several circumstances where the IRS has rewritten Section 36B of the tax code, which offers tax credits to persons who purchase health coverage on an exchange established by a state. In this post, I want to discuss how the IRS has, out of thin […]

In researching Section 4980H assessable payments, commonly referred to as the ACA employer penalty, I came across some potentially significant statements in IRS Notice 2011-36, dated May 23, 2011. The Notice, which reflects an official statement of the IRS, solicits public comments related to regulations under Section 4980H. In describing the statutory scheme, the IRS […]

If there are any tax attorneys in the courtroom today, I think they probably wrote down what you just said.” —Justice Alito, referring to Solicitor General Verrilli’s comments on the legislative grace canon. *              *               * In a few weeks, we can expect […]

In a characteristically thoughtful post, Professor Richard Re examines whether the transfer of an increasing number of cases to Article I legislative courts could pose a threat to the Article III judicial power exercised by federal district courts. He writes in the context of Wellness International Network v. Sharif, which sanctioned some exercise of the […]

In Validus Reinsurance Ltd. v. United States, the D.C. Circuit addressed the potential conflict between Chevron and the presumption against the extraterritorial application of statutes. In that case, a foreign company, Validus, reinsured other insurance companies’ policies. Validus then sought protection for its own reinsurance risks, and it purchased reinsurance from other foreign companies. The D.C. […]

I might be accused of picking at low-hanging fruit, but I’d nonetheless like to devote another blog post to more IRS regulations that expand and contradict Section 36B. My prior blog posts, which I’ve adapted into an essay upcoming in Bloomberg BNA, discuss regulations that improperly extend ACA premium tax credits to persons in the […]

Before it collapsed, Lehman Brothers engaged in various tax-motivated transactions, including ones to earn foreign tax credits. Last week, a federal judge addressed the merits of one of those controversies, holding against the defunct bank. The court tucked in a footnote a potentially interesting twist on agency deference. It noted that a so-called IRS Advisory […]

Microsoft Corp. has recently challenged the enforcement of IRS summons regarding some of its international tax planning, arguing that the IRS has flouted the law by allowing Quinn Emanuel Urquhart & Sullivan to participate in an audit of the company. The dispute raises many fundamental questions that a district court has been asked to answer. […]

In a prior post, I discussed how I thought the use of the phrase “IRS Code,” as opposed to “Internal Revenue Code,” reflected some sloppiness on the part of the speaker, but that the phrasing was not inherently misleading. Here, I want to discuss whether another phrase that triples the blood pressure of the typical […]