Source: http://federaltaxprocedure.blogspot.com/2017/02/
Timestamp: 2019-04-25 11:07:54+00:00

Document:
Basically, I conclude that the historic distinction between legislative and interpretive regulations remains even after Chevron and its progeny, although some loose thinking / language about Chevron has muddied the water as to the historic distinction. I will state the historic distinction and refer readers to the linked documents for more details (both pro and con).
According to the theory, legislative rules are the product of a power to create new law, and interpretative rules are the product of interpretation of previously existing law. Legislative rules may change the law but interpretative rules merely clarify the law they interpret.
To illustrate this discussion, I use examples at the extremes of a spectrum. Such examples can offer key insight even though much of the play in the real world is between the extremes where things become less certain. Here are the extremes on the issue at hand. Code § 162(a)(2) allows deductions for expenses incurred while “traveling ... away from home in the pursuit of a trade or business.” The regulation, adopted under the general authority stated in § 7805(a), interpreted “traveling ... away from home” text to require that the taxpayer must sleep or rest, sometimes called the overnight rule. The Supreme Court sustained the regulations’ interpretation of the statutory text. The regulation was an interpretive regulation. By contrast, § 1502 delegates to the IRS the authority to adopt regulations that the IRS “may deem necessary” for consolidated reporting among an affiliated group of corporations. The regulations do so in mind numbing detail, in regulation after regulation. The consolidated return regulations are legislative regulations.
The Chevron doctrine may be summarized as a rule of interpretation of a statute that defers to an agency interpretation under this analysis: Step One, if the text is plain (not ambiguous), that meaning applies, end of analysis; do not go past Step One; and Step Two, if the text is not plain (ambiguous), the agency interpretation applies unless unreasonable. Under my analysis (perhaps not mainstream), Chevron only applies to agency regulations that are interpretive and does not apply to legislative regulations.
The linked text relates to the foregoing with more detail.
I address in this blog the current movement to eliminate or throttle back on Chevron deference. There are speculations about at least judicial throttling back when Judge Neil Gorsuch is confirmed as a justice on the Supreme Court. And, there is pending legislation that would eliminate Chevron deference. The proposed legislation would take away the authority of the judiciary to apply Chevron. Although not mentioning Chevron by name, the proposed legislation would require courts do the following with respect to agency rulemaking: (i) "decide de novo all relevant questions of law, including the interpretation of constitutional and statutory provisions, and rules made by agencies" and (ii) take away from courts the authority to interpret a statutory "gap or ambiguity as an implicit delegation to the agency of legislative rule making authority and [to] rely on such gap or ambiguity as a justification either for interpreting agency authority expansively or for deferring to the agency’s interpretation on the question of law."
First, note that this speaks only as to interpretive issues related to Chevron, not legislative rulemaking authority.
Second, I just pose this practical question. If the Supreme Court or the legislation would eliminate the Chevron doctrine, what would that mean for legislative regulations? Under my interpretation (summarized above and detailed in the linked document), Chevron is a rule of interpretation applying only to statutory interpretations. Chevron is not a rule that can apply to a legislative regulation under the traditional definition of legislative regulation (a regulation establishing the substantive rule).
If as some claim, Chevron applies to legislative regulations, what would happen to, for example, the consolidated return regulations under § 1502 after the demise of Chevron (either judicial demise or legislative demise)?
Ch. 19. Foreign Bank Account Reports (FBARs) And Related.
III. Requirements for Filing the FBAR.
A reader posted a reminder under another blog entry that the due date for the FBAR report, FinCEN 114, here, is now due April 15 for the prior year's report. When the filing date falls on a weekend day or on a holiday, the filing date is the next succeeding business day (a weekday that is not a holiday). Accordingly, the due date for the 2016 year is April 18, 2017 (per the IRS web site here). And, FinCen is providing an automatic extension (no filing required to obtain the extension) until October 15 (which, for the 2016 report, will be October 16, 2017, because October 15 is a Sunday).
n1 § 2006(b)(11), the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (P.L. 114-41). The effective date of this FBAR filing provision is the filing year 2016 (i.e., the 2016 FBAR is due April 15, 2017 (actually, on the next succeeding business day), subject to the automatic extension to October 15, 2017 noted in the text).
One might even say that, as thus formulated, the real filing due date is October 15.
New Due Date for Filing FinCEN Form 114 -- 12-JAN-2017, here.
Individuals Filing the Report of Foreign Bank and Financial Accounts (FBAR), here.
BSA Electronic Filing Requirements For Report of Foreign Bank and Financial Accounts (FinCEN Form 114), here.
I. The Notice of Deficiency and its Role in the System (A Reprise).
B. What is a Notice of Deficiency?
2. The Notice of Deficiency.
a. The Notice, Determination and Explanation.
n1635a Dees v. Commissioner, 148 T.C. ___, No. 1 (2017) (reviewed opinion).
The notice on its face is ambiguous, but the Commissioner has established that he made a determination and that Mr. Dees was not misled by the notice. Mr. Dees timely filed a petition to challenge the notice, and that petition makes clear that Mr. Dees understood that the Commissioner had disallowed his refundable credit: He stated in his petition both that the Commissioner had erred in denying his premium tax credit and that he had documents to substantiate his entitlement to the credit. This establishes that Mr. Dees was not misled by the notice.
n1653c §§ 6213(a) (prohibition on assessment which Tax Court petition for redetermination is pending; and 6503(a)(1) (suspension during period of prohibition). See Shockley v. Commissioner, 686 F.3d 1228 (11th Cir. 2012) (holding that the filing of a Tax Court petition invoked the suspension even if the notice of deficiency was invalid or the filing was not by the proper person; per § 6503(a)(1), the suspension occurs “if a proceeding in respect of the deficiency is placed on the docket of the Tax Court”).
Correct the status of the Tax Court as an Article I court independent of the judicial system subject to Article III and independent of the executive branch. Prior to this change, the text in the current version indicated that the Tax Court was within the executive branch of Government. It is not. An error that should have been corrected previously.
The United States Tax Court is an Article I court independent of the Article III judicial system and independent of the executive branch. § 7441. n339 The Tax Court has jurisdiction over tax related claims only. Generally, the Tax Court has jurisdiction to redetermine deficiencies proposed by the IRS and resolve certain other disputes with the IRS. The Tax Court is the principal court in which tax controversies are litigated.
n339 See Burns, Stix Friedman & Co. v. Commissioner, 57 T.C. 392, 395 (1971); and Freytag v. Commissioner, 501 U.S. 868, 890-892 (1991. In 2015, in response to the Kuretski case (cited below in the footnote), Congress added this sentence to § 7441: “The Tax Court is not an agency of, and shall be independent of, the executive branch of the Government;” that sentence codifies a clause from Freytag v. Commissioner, p. 891 “[t]he Tax Court remains independent of the Executive * * * Branch[es].” The President does have the power to power to remove Tax Court judges “for inefficiency, neglect of duty, or malfeasance in office, but for no other cause.” § 7443(f). Two key cases have held that the President’s limited power to remove Tax Court judges does not violate separation of powers principles (although the two cases reach the conclusion for different reasons). Battat v. Commissioner, 148 T.C. ___, No. 2 (2017) (holding that the interbranch removal power did not implicate Article III because the Tax Court does not exercise Article III judicial power; Battat also has a good discussion of the history of the Tax Court from its inception as the Board of Tax Appeals to its current status); and Kuretski v. Commissioner, 755 F.3d 929 (D.C. Cir. 2014) (holding before the amendment noted above, that the Tax Court was an executive branch court that could permissibly be subject to Presidential removal); see also Byers v. United States Tax Court, 2016 U.S. Dist. LEXIS 135596 (D. D.C. 2016) (holding that the Tax Court is a court exempt from FOIA and containing a good discussion of the status of the Tax Court). See also Brant J. Hellwig, The Constitutional Nature of the United States Tax Court, 35 Va. Tax Rev. 269 (2015).
State C Corporation filing date as a result of 2015. For most C Corporations, the statute changes the return due date for most C Corporations from the 15th day of the third month to the 15th day of the fourth month (from March 15 to April 15 in the case of C Corporation calendar year taxpayers). The first two sentences will be replaced with the text below.
Individual and most C Corporation income tax returns are due on the 15th day of the fourth month after the close of the tax year (i.e., April 15 for calendar year returns; virtually all individual returns are calendar year returns, but for taxpayers on a fiscal year, the return is due on the 15th day of the fourth month after the close of the fiscal year). 530a This filing date rule does not apply until 2025 to C Corporation taxpayers with a fiscal year of June 30. 530b Partnership and S Corporation returns are due on the 15th day of the third month after the end of the tax year (March 15 for calendar year returns). 530c n530a § 6072(a). The filing date of the 15th day of the fourth month (April 15 for calendar year reporters) for C Corporations is effective for 2016 returns filed in 2017. Prior to that effective date, the due date for C Corporation returns was the 15th day of the third month (March 15 in the case of calendar year reporters).
n530b Surface Transportation and Veterans Health Care Choice Improvement Act of 2015, (P.L. 114-41) § 2006(a)(3). I have no idea as to the reason for this exception to the general rule due date of the 15th day of the fourth month. The net effect of the new rules is that for those Corporate taxpayers wanting to file by the pre-change date of 15th day of third month can still do so and can still file by the former extension date of 15th day of the ninth month because the extension date for the new rule will be October 15th. So, I am not sure what was achieved by excepting fiscal year Juen 30 filers in the real world.
I will make consistent changes to the discussion of extension dates in the next section in both editions. Essentially, returns now due on the 15th day of the fourth month (April 15 for calendar year individuals and most C Corporations) can be extended for six months to the 15th day of the tenth month.

References: § 162
 § 7805
 § 1502
 § 1502
 § 2006
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 § 6503
 § 7441
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 § 7441
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 § 7443
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 § 6072
 § 2006