The James Hausman Tax Law and Policy Workshop
Presents:
Alice G. Abreu
Temple University, Beasley School of Law
Relying on IRS Publications: A Taxpayer's Right
Wednesday September 25, 2019
12:30pm - 2:00pm
Falconer Hall, 84 Queen's Park
Solarium(FA2)
ABSTRACT: The IRS takes the position that taxpayers are not entitled to rely on written statements that it makes in instructions to IRS forms and in Publications that are designed for the specific purpose of helping taxpayers meet their tax obligations. And the courts have approved that position, stating that “taxpayers rely at their peril” on IRS written statements in publications. We believe that the IRS position impugns the legitimacy of the agency and of the tax system; we can also show that it is unnecessary for the IRS to take such a position because in most of the cases in which the courts invoke the “reliance at peril” mantra, there was either no reliance, or the reliance was unreasonable. Invocation of the mantra therefore serves only to threaten the legitimacy of the tax system and the IRS. For those reasons alone, the IRS should announce that taxpayers can indeed rely on what it says in its publications and instructions to forms. If the IRS does not want to go that far, it can at least exercise its enforcement discretion to decline to enforce against taxpayers positions that run counter to those it has clearly expressed in publication or instructions to forms. If the IRS declines to do even that, courts can ameliorate the damage to the legitimacy of the tax system by not invoking the reliance-at-peril mantra when it is not relevant either because there is no evidence of reliance or because any reliance was unreasonable. But if the IRS and the courts are not willing to change their position for the reasons just articulated, we offer an additional, possibly more compelling, reason: the IRS’s adoption and subsequent congressional enactment of the Taxpayer Bill of Rights (TBOR). The TBOR contains as the very first taxpayer right, the right to be informed. In this article we develop the ideas we’ve explored in prior work on the effect of the TBOR by focusing on its potential to change both the IRS’s position on the taxpayer’s ability to reasonably rely on written statements intended for their guidance, and the courts’ response to such reliance. We also suggest that if the IRS persists in taking litigating positions in contravention of the statements it has made in its own publications and instructions to forms, taxpayers should ask courts to estop the IRS from doing so. We recognize that asserting equitable estoppel against the government is difficult, but, again, we believe that the enactment of the TBOR provides a basis for a change in the status quo.
Alice G. Abreu is a Professor of Law at Temple University’s Beasley School of Law, where she teaches courses in Taxation, Corporate Taxation, Low Income Taxpayer Policy and Practice, and International Taxation. She is a magna cum laude graduate of both Cornell University and its Law School, where she served as an editor of the Cornell Law Review. Before joining the Temple faculty in 1985, she clerked for Judge Edward N. Cahn (EDPA) and practiced tax law with Dechert, LLP, in Philadelphia. Professor Abreu has published numerous articles in scholarly and professional journals, been an editor of a casebook on Taxation, and is a frequent speaker at national and international conferences. She is a Regent of the American College of Tax Counsel, a member of the American Law Institute, and an Associate Member of the European Association of Tax Law Professors. She has served as Vice-Chair (Publications), of the Tax Section of the American Bar Association, been the Editor-in-Chief of The Tax Lawyer, and was a member of the Tax Section’s leadership Council for eight years.In April, 2017, Professor Abreu was named a Temple University Great Teacher. She has also received the Lindback Award for Distinguished Teaching, as well as the Murray Shusterman Faculty Award. Professor Abreu has visited at a number of law schools, including Harvard, Penn, and Yale.
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