Tax & Kisor v. Wilkie

Continuing with the second of my series of posts on the tax implications of recent SCOTUS decisions:

One high-profile Supreme Court decision this year was Kisor v. Wilkie.  As I noted in a post a few days ago, the Court in Kisor retained the Auer deference standard for agency regulatory interpretations, but largely because Justice Kagan writing for the Court articulated a new five-part test for Auer deference that cemented a longtime evolution toward a narrower and less deferential Auer.  In framing the Court’s retention of Auer deference this way, Justice Kagan gained the vote of Chief Justice Roberts in the name of stare decisis. 

Auer deference has never been especially pivotal in tax cases. The Tax Court hasn’t taken Auer particularly seriously, and the Treasury Department issued a policy statement last spring stating that the government would not seek Auer deference for IRS subregulatory guidance. Treasury could change its mind and retract that policy, but the new five-part Auer test makes judicial deference for IRS regulatory interpretations under that doctrine less likely in any event. 

But Auer is not the only Judicial deference that has been under attack lately. As with Auer, commentators and at least a couple of Supreme Court Justices have argued for overturning the Chevron deference doctrine.  By comparison with Auer, Chevron has played a significant role in tax cases, particularly since the Mayo Foundation decision.  In his concurring opinion in Kisor, Chief Justice Roberts made a point of suggesting that Kisor would have no bearing on a future case reconsidering Chevron deference. Yet despite those cautionary words, Kisor seems useful as a harbinger of what the Court might do down the road with ChevronChevron has always enjoyed stronger theoretical and doctrinal defenses than Auer. It is difficult to imagine that the Court that found a way to retain Auer will repudiate Chevron, particularly when there are just as many ways to curtail Chevron deference without getting rid of it altogether.  

To return to the first post in this series, click here.

kristin hickman

Professor Kristin Hickman is a legal scholar working in the fields of tax administration, administrative law, and statutory interpretation. In addition to the Of Interest blog, Professor Hickman authors the Administrative Law Treatise (with co-author Richard J. Pierce, Jr.) and has published scholarly articles in Columbia Law Review, Virginia Law Review, Cornell Law Review, Duke Law Journal, Georgetown Law Journal, Vanderbilt Law Review, and many other prominent U.S. and international publications. She holds the titles of Distinguished McKnight University Professor and Harlan Albert Rogers Professor of Law at the University of Minnesota Law School.