Sixth Circuit: IRS, unlike Caligula, cannot punish under unproclaimed law

Judge Jeffrey Sutton, writing for a Sixth Circuit panel, reverses a Tax Court ruling in an opinion beginning thus:

Caligula posted the tax laws in such fine print and so high that his subjects could not read them. Suetonius, The Twelve Caesars, bk. 4, para. 41 (Robert Graves, trans., 1957). That’s not a good idea, we can all agree. How can citizens comply with what they can’t see? And how can anyone assess the tax collector’s exercise of power in that setting? The Internal Revenue Code improves matters in one sense, as it is accessible to everyone with the time and patience to pore over its provisions.

In today’s case, however, the Commissioner of the Internal Revenue Service denied relief to a set of taxpayers who complied in full with the printed and accessible words of the tax laws. The Benenson family, to its good fortune, had the time and patience (and money) to understand how a complex set of tax provisions could lower its taxes.

And taking issue with the IRS Commissioner’s decision to disallow the use of two Congressionally approved devices, the Roth IRA and DISC (domestic international sales corporation), in a way said to trigger the so-called substance-over-form doctrine:

Each word of the “substance-over-form doctrine,” at least as the Commissioner has used it here, should give pause. If the government can undo transactions that the terms of the Code expressly authorize, it’s fair to ask what the point of making these terms accessible to the taxpayer and binding on the tax collector is. “Form” is “substance” when it comes to law. The words of law (its form) determine content (its substance). How odd, then, to permit the tax collector to reverse the sequence—to allow him to determine the substance of a law and to make it govern “over” the written form of the law—and to call it a “doctrine” no less.

[Summa Holdings v. Commissioner of Internal Revenue via Paul Caron/TaxProf]

Gorsuch nomination roundup

More on the nominee, starting with a Washington Post profile:

  • How to read last year’s Garland precedent? [David Post, Jonathan Adler]
  • Gorsuch “consistently applied established First Amendment protections” [Adam Liptak, New York Times quoting Gregg Leslie of Reporters Committee for Freedom of the Press]
  • We’ve earlier linked Cato podcasts on the nomination with Ilya Shapiro and Andrew Grossman and now here’s a somewhat more skeptical one featuring Ilya Somin;
  • On product liability [Eric Wolff, Perkins Coie]
  • California Federation of Teachers, explaining its opposition to the nomination, dismisses his constitutionalism as devotion to a document “drafted to protect the interests of white slave owners” (via Amy Alkon);
  • “Follow the law, as judges are supposed to do, and you’ll get tarred as a supporter of criminals” when Nancy Pelosi et al. go low: [Eugene Volokh on gun cases U.S. v. Games-Perez and U.S. v. Reese]

Civics 101 podcast: “How to Amend the Constitution”

I joined Virginia Prescott for episode 4 of the interesting Civics 101 podcast series, hosted by New Hampshire Public Radio, this one covering the Article V constitutional amendment process. You can also find it at NPR and AudioBoom. Description:

It’s been 25 years since the last constitutional amendment was ratified. How hard is it to change our most sacred document? We discover that there are not one, but two ways to amend the constitution – and one of them has never been used. Walter Olson, senior fellow of the Cato Institute explains that the founders didn’t exactly spell the process out clearly.

February 22 roundup

  • “Freedom of Association Takes Another Hit” as Washington high court rules against florist Barronelle Stutzman [Roger Pilon, Ilya Shapiro, earlier]
  • Aside from chipping away at the rule of law, job preservation via presidential threats may not work well as an economic development strategy [David Henderson]
  • NYC cops shot burglar in rear end and now he wants $10 million over that [New York Post]
  • Granting certiorari in Blackman v. Gascho case would allow Supreme Court to tackle fee abuses in class actions [Ted Frank, Daniel Fisher, earlier]
  • Will competing versions be introduced of FADA, the religious-exemption First Amendment Defense Act? [Jessica Yarvin/PBS, I’m quoted; my take on the first introduced version of the bill]
  • I talked Sunday with Maryland-based blog radio hosts Ryan Miner and Eric Beasley on topics that included the Gorsuch nomination, Chevron deference, doctor-assisted suicide, and redistricting reform [BlogTalkRadio, one of my longer audio interviews at 1:12:00]

Washington, D.C. March 2: Book forum on business and the Roberts Court

At 4 p.m. on March 2 — that’s Thursday of next week — I’m hosting a Cato book forum for Jonathan Adler to discuss his new book, Business and the Roberts Court (Oxford University Press, 2016). Commenting will be Andrew Pincus of Mayer Brown. Details and registration here:

Is the Supreme Court “pro-business?” That’s a claim often heard from critics of the Roberts Court, now circulating once more amid a likely battle over the confirmation of a successor to the late Justice Antonin Scalia. But what does the claim mean? Does it charge the Court with ruling wrongly in favor of business litigants, with shaping legal doctrine in unprincipled ways, or with something else? In Business and the Roberts Court, Professor Jonathan Adler assembles essays from scholars who consider how and whether Roberts Court decisions can or cannot be fairly deemed favorable to business. One pattern is that this Court follows doctrinal commitments — in areas from free speech to federalism to employment and securities law — that sometimes though not always coincide with the interests of producers and employers in the national economy. As the Senate considers President Trump’s nomination of Neil Gorsuch to the vacant seat on the Court, join us for a book forum on one of the most important elements of Chief Justice John Roberts’ rule — and Antonin Scalia’s legacy.

If you can’t make it in person, you can watch live online.