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May Regulations that Violate the APA Be Remanded to the IRS?

8 Pages Posted: 10 Oct 2013  

Patrick J. Smith

Ivins, Phillips & Barker

Date Written: October 7, 2013

Abstract

Last year in Dominion Resources, the Federal Circuit invalidated a tax regulation in part on the basis that it violated the Administrative Procedure Act’s arbitrary and capricious standard because the IRS failed to provide an explanation for the regulation at the time it was issued. It was the first time a court of appeals invalidated a tax regulation on that basis. This article discusses a recent case comment in the Harvard Law Review contending that although many tax regulations would be vulnerable to similar challenges, large-scale invalidation would be prevented by the practice followed by some courts of remanding defective regulations to the issuing agency for corrective action while leaving them in effect. This article disputes that contention, arguing that the practice of remanding without vacating would not apply to most tax litigation because of the Anti-Injunction Act.

Keywords: administrative law, validity of regulations, tax, State Farm, Anti-Injunction Act, arbitrary and capricious

Suggested Citation

Smith, Patrick J., May Regulations that Violate the APA Be Remanded to the IRS? (October 7, 2013). Tax Notes, Vol. 84, p. 141, 2013. Available at SSRN: https://ssrn.com/abstract=2337947

Patrick J. Smith (Contact Author)

Ivins, Phillips & Barker ( email )

1700 Pennsylvania Avenue, NW Suite 600
Washington, DC 20006
United States

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