Kevin Kenworthy Quoted in CCH Federal Tax Weekly Regarding Tax Court Decision in Carpenter Family Investments

"Tax Court Again Upholds Three-Year Limit On Basis-Overstatement Assessments; Challenges IRS's Reg Authority"
CCH Federal Tax Weekly
04.29.11Kevin Kenworthy comments on the Tax Court decision in Carpenter Family Investments. "Although the Supreme Court's recent decision in Mayo confirmed that Chevron deference principles apply in evaluating the degree of deference owed to Treasury regulations, it leaves some important questions unresolved," Kenworthy said. He further observed, "The majority opinion in Carpenter Family Investments highlights the unresolved issue of whether it is appropriate for a court to consider legislative history in step 1 of the Chevron two-step analysis. In evaluating whether deference is owed to an agency interpretation, Chevron first requires a court to determine if Congress has clearly expressed its intent in the statute. In making this determination, Chevron instructed that "traditional tools of statutory construction" were to be used. Subsequent decisions, including Mayo, have suggested that if a court must resort to legislative history to interpret a statute, the statutory text is necessarily ambiguous and the court should proceed to Chevron step 2. The Tax Court majority rejected this conclusion and its opinion sets the stage for the courts of appeal to provide additional guidance on this critical issue."
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