The APA's Arbitrary and Capricious Standard and IRS Regulations

9 Pages Posted: 18 Jul 2012

Date Written: July 16, 2012


The Supreme Court’s Mayo decision and the D.C. Circuit’s Cohen decision have made clear that principles of administrative law generally, and the Administrative Procedure Act (APA) in particular, apply to tax law and the IRS just as they do to all other federal agencies. The APA’s arbitrary and capricious standard provides a powerful but seldom-used tool for taxpayers in challenging IRS regulations, because the IRS seems unaware of the requirements imposed by the standard and even instructs its personnel to draft preambles to regulations in a way that is inconsistent with what the standard requires.

Keywords: administrative procedure act, APA, State Farm, arbitrary and capricious standard, Mayo, IRS

Suggested Citation

Smith, Patrick J., The APA's Arbitrary and Capricious Standard and IRS Regulations (July 16, 2012). Tax Notes, Vol. 136, 2012, Available at SSRN:

Patrick J. Smith (Contact Author)

Ivins, Phillips & Barker ( email )

1717 K Street, NW Suite 600
Washington, DC 20006
United States

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