Federal appeals court strikes down IRS licensing regulation

[JURIST] The US Court of Appeals for the District of Columbia Circuit [official website] on Tuesday struck down [opinion, PDF] licensing regulations imposed by the Internal Revenue Service (IRS) [official website] on tax preparers, holding that nothing within the text of the law or legislative history contemplates such a vast expansion of the IRS's authority. Writing on behalf of a unanimous three-judge panel, Circuit Judge Brett Kavanaugh stated that the IRS's statutory authority cannot be stretched so broadly as to encompass authority to regulate tax-return preparers. The new regulations, imposed in 2011 by the IRS, would have affected hundreds of thousands [WSJ report] of tax preparers. It is unknown [Reuters report] whether the Obama administration will seek review before the US Supreme Court.

The IRS is no stranger to improper protocol and procedure. In May of last year the Justice Department opened a criminal investigation [JURIST report] into allegations that the IRS unfairly scrutinized tax-exemptions for conservative groups. The agency initially singled out groups with applications containing the names "Tea Party" or "Patriots," but expanded to target groups that promoted Constitutionalism. The misstep led to the issuance of an apology [Reuters report] from the IRS, the resignation [Washington Post report] of Acting Commissioner Steven Miller, as well as comment from US President Barack Obama [official website], calling [press release] the IRS actions "outrageous."

 

About Paper Chase

Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible format.

© Copyright JURIST Legal News and Research Services, Inc., 2013.