court decision on IRS RTRP authority challenge


M

Mark Bole

I received this today from NAEA, National Association of Enrolled Agents:

www.naea.org

"A decision was announced this afternoon regarding the 2012 court case
Loving v. IRS, which challenged IRS’ authority to regulate commercial
preparers. United States District Court for the District of Columbia
Judge James E. Boasberg granted Loving’s motion for summary judgment.
The Court is granting a permanent injunction against IRS for what the
opinion calls “an invalid regulatory regime.”

"As with any legal matter, it is best not to jump to conclusions,
particularly in the moments following major decisions. As we sit here on
Friday evening, the obvious question is how IRS will respond. In any
event, this situation will develop over the next week and upcoming
months. NAEA will continue to interpret possible ramifications for
enrolled agents and the overall tax community and will share our
perspective during the back and forth volleying that promises to ensue."
 
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R

removeps-groups

I received this today from NAEA, National Association of Enrolled Agents:

www.naea.org

"A decision was announced this afternoon regarding the 2012 court case
Loving v. IRS, which challenged IRS’ authority to regulate commercial
preparers. United States District Court for the District of Columbia Judge
James E. Boasberg granted Loving’s motion for summary judgment. The Court
is granting a permanent injunction against IRS for what the opinion calls
“an invalid regulatory regime.”

"As with any legal matter, it is best not to jump to conclusions,
particularly in the moments following major decisions. As we sit here on
Friday evening, the obvious question is how IRS will respond. In any
event, this situation will develop over the next week and upcoming months.
NAEA will continue to interpret possible ramifications for enrolled agents
and the overall tax community and will share our perspective during the
back and forth volleying that promises to ensue."
Does the decision cover just the annual test, or also the annual $64 fee to
get a PTIN? What was the gist of their argument -- I'm having a hard time
opening the PDF. Is it because the law does not authorize this type of
executive action?
 
A

Alan

Does the decision cover just the annual test, or also the annual $64 fee to
get a PTIN? What was the gist of their argument -- I'm having a hard time
opening the PDF. Is it because the law does not authorize this type of
executive action?
You can find a pdf version here:

http://ia601506.us.archive.org/17/items/gov.uscourts.dcd.153247/gov.uscourts.dcd.153247.22.0.pdf

Effectively, the judge said that Congress never gave the IRS the
authority to license tax preparers, and the IRS can’t give itself that
power.

Quoting from various parts:

Without deciding whether any of these three textual points alone would
be dispositive, the Court concludes that together the statutory text and
context unambiguously foreclose the IRS’s interpretation of 31 U.S.C. § 330.

Plaintiffs first seek a declaratory judgment that Defendants lack
statutory authority to promulgate or enforce the new regulatory scheme
for “registered tax return preparers” brought under Circular 230 by 76
Fed. Reg. 32,286. The Court will grant this declaratory relief.

Finally, the public interest would be served by a permanent injunction
because the IRS’s new Rule is ultra vires. The Court will therefore
grant permanent injunctive relief as well.

For the aforementioned reasons, the Court will grant Plaintiffs’ Motion
for Summary Judgment and deny Defendants’ Motion for Summary Judgment.
A separate Order consistent with this Opinion will be issued this day.
 
D

D. Stussy

"Alan" wrote in message
Does the decision cover just the annual test, or also the annual $64 fee to
get a PTIN? What was the gist of their argument -- I'm having a hard time
opening the PDF. Is it because the law does not authorize this type of
executive action?
You can find a pdf version here:

http://ia601506.us.archive.org/17/items/gov.uscourts.dcd.153247/gov.uscourts.dcd.153247.22.0.pdf

....
================
OK, [to repeat,] so does that mean that we should all file claims for refund
for the PTIN fee since that is part of this "regulatory scheme?" I did read
all 22 pages of the decision.
 
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B

Bob Sandler

Does the decision cover just the annual test, or also the annual $64 fee to
The decision does NOT apply to the PTIN fee. Here is a quote
from the FAQ posted by the NATP.

"Do I have to continue to renew my PTIN?
Yes, the PTIN regulations were separate from the Tax
Preparer Registration regulations. In the closed case
Brannen, III, P.C. v. U.S., the IRS was sued for $64.25 with
the complaint that the Department of the Treasury lacked
statutory authority to impose a user fee for obtaining and
renewing a PTIN. The Eleventh Circuit court disagreed and
held that the PTIN is issued to preparers for a special
benefit, the privilege of preparing tax returns for others
for compensation, and imposing fees for special benefits is
authorized under 31 U.S.C. § 970."

http://www.natptax.com/TaxKnowledgeCenter/RTRPExam/Pages/RTRPCourtInjunction.aspx

Bob Sandler
 

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