Chief Counsel Advice to IRS Attorneys on Treasury and IRS Policy Statement on Tax Regulatory Process (9/25/19)

I have written before on this blog and in a recent article on the subject of the continuing viability of IRS interpretive regulations under the Administrative Procedure Act ("APA").  See e.g., Article on the Continued Viability of the APA Category of Interpretive Regulations (Federal Tax Procedure Blog 6/21/19), here; and see generally all blog entries on the subject sorted by relevance (but can be sorted by date), here.

In one of the blog entries I discuss the Treasury and IRS Policy Statement on the Tax Regulatory Process.  See, Treasury and IRS Policy Statement on Tax Regulatory Process (Federal Tax Procedure Blog 3/17/19), here.  The Policy Statement is here.

IRS Chief Counsel has issued a memorandum on the Policy Statement:  CC-2019-006 (9/17/19) re Policy Statement on the Tax Regulatory Process, here.  The purpose of the memorandum is to inform Chief Counsel attorneys of the general requirements of the Policy Statement.

As relevant to the issue I have spent significant time on recently--the issue of the continuing viability of IRS interpretive regulations qua the interpretive regulations category under the APA, CC-2019-006 says:  "the policy statement provides that Treasury and the IRS will continue to adhere to their longstanding practice of using the notice-and-comment process for interpretative tax rules published in the Code of Federal Regulations."

JAT Comments:

1.  Exactly.  For those wanting my views on that subject, see the article:  Townsend, John A., The Report of the Death of the Interpretive Regulation Is an Exaggeration (June 6, 2019). Available at SSRN: https://ssrn.com/abstract=3400489.

2.  Also, CC-2019-006 repeats the commitment in the Policy Statement not to assert Auer deference for subregulatory advice.  The Policy Statement was issued before the Supreme Court sustained Auer in limited application in Kisor v. Wilkie, ___ F.3d ___, 139 S.Ct. 2400 (2019), here.  Hence, the Policy Statement apparently surrenders some Auer authority for subregulatory guidance, and CC-2019-006 confirms that.   In this regard, Auer involves deferring to agency subregulatory interpretations of ambiguous regulations' text.  But, the Policy Statement says that the IRS will not do assert Auer deference.  Presumably, DOJ Tax will not either, but I have seen no announcement to that effect.  I  have written on this issue:  Auer Deference and Treasury and IRS Policy Statement on the Tax Regulatory Process (7/6/19), here.