Kelly Bullis
Now here is a whopper of a fishing story!
The current session of the U.S. Supreme Court has an interesting case on the docket. If they rule in favor of the plaintiffs, it could end up changing a long-standing rule from a prior Supreme Court ruling of almost 40 years ago which underpins the ability of the IRS to do its job.
The case is about regulation of fishing boats. And the old Supreme Court doctrine at risk is called the “Chevron Deference Doctrine.”
The “Chevron Deference Doctrine” was a coined name that came from a famous landmark case “Chevron USA Inc vs. Natural Resources Defense Council Inc” back in 1984. The Supreme Court set forth a legal test as to when a court should defer to an agency’s answer or interpretation, holding that such judicial deference is appropriate where the agency’s answer was not unreasonable, so long as Congress had not spoken directly to the precise issue at question.
Basically, when a legislative delegation to an administrative agency on a particular issue or questions is not explicit but rather implicit, a court may not substitute its own interpretation of the statute for a reasonable interpretation made by the administrative agency. Justice Stevens wrote in Chevron, “When the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s action was based on a permissible construction of the statute.”
Now here come some herring fishermen in New Jersey who work the North Atlantic. For nearly 50 years, American fishermen were required to take federal monitors on their boats when they set sail into the Atlantic. The monitors record the health of fish and of the sea. Now regulators have decided to make the fishermen pay the salaries of those government monitors. The fishermen got their dander up and said, “ENOUGH!” They joined together and started a crusade that has ended up in the U.S. Supreme Court.
If the Supreme Court rules in favor of the fishermen, the “Chevron Deference Doctrine” will have been weakened. How much will be the question.
How does fishing affect taxes? The IRS issues regulations. Lots of regulations. Without the underpinning of the Chevron Deference Doctrine, taxpayers could challenge the IRS regulations and perhaps win. That would really mess up the IRS.
Now, don’t you just love those Atlantic fishermen?
Have you heard? Psalm 32:9 says, “Don’t be like the horse, or like the mule, which have no understanding, who are controlled by bit and bridle, or else they will not come near to you.”
Kelly Bullis is a Certified Public Accountant in Carson City. Contact him at 775-882-4459. On the web at BullisAndCo.com. Also on Facebook.