Wednesday, March 30, 2011
The Supreme Court’s 2011 decision in Mayo Foundation for Medical Education and Research v. United States clarified a few things about judicial deference in the tax context: general administrative law standards govern judicial review of general authority Treasury regulations (instead of the tax-specific standard articulated in National Muffler Dealers Ass’n v. United States); and, based on the test articulated in United States v. Mead Corp., general authority Treasury regulations promulgated through notice-and-comment rulemaking carry the force of law and are eligible for deference under Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. The Court left many questions unanswered, among them (1) whether temporary Treasury regulations and IRB guidance documents (revenue rulings, revenue procedures, and IRS notices) that lack notice and comment but are enforceable through civil penalties are likewise eligible for Chevron deference or only the less deferential review of Skidmore v. Swift & Co., and (2) whether these formats are legislative rules subject to APA notice-and-comment rulemaking procedures or interpretative rules exempt from those requirements.
Under general administrative law doctrine, the courts would apply different tests and steps for answering these questions. Ultimately, however, whether a particular rule is legislative in character depends upon whether that rule carries “the force of law.” Likewise, whether agency action is eligible for Chevron deference likewise turns upon whether that action carries “the force of law.” In considering these issues, it is not at all clear whether “the force of law” occupies precisely the same conceptual space. The purpose of this article is to try to resolve the questions left unanswered by the Mayo Court by exploring and attempting to reconcile the history and nuances of the force of law concept as the courts have applied it in different administrative law contexts.