President Bambi, Legislator-in-Chief, Suffers Setback on Illegal IRS RulesPosted: February 12, 2014
“The IRS may not unilaterally expand its authority through such an expansive, atextual, and ahistorical reading of” the law. The Court of Appeals for the District of Columbia Circuit used these words in a Feb. 11 ruling that struck down an Obama administration regulation on tax preparers.
Federal judges should copy this phrase and be ready to paste it into rulings — sometimes replacing “IRS” with “Health and Human Services” — as President Obama continues to act as legislator in chief, making and amending laws as he sees fit, separation of powers be damned.
In the same week Obama illegally delayed the employer mandate and out of thin air created a bizarre loyalty oath to administer to companies suffering from Obamacare, a federal court unanimously smacked down his IRS for executive overreach.
The latest IRS case wraps in a tight ball all of the defects of Obama’s governing style — the constantly revolving door between private and public sectors, a rogue IRS, skirted ethics rules, burdensome regulations that crush Mom and Pop and favor big business, and, above all, the usurpation of Congressional prerogatives by the executive branch.
In 2009, Obama named former H&R Block CEO Mark Ernst as deputy IRS commissioner. Ernst helped lead the crafting of new regulations for tax preparers. The rules required paid tax preparers to be licensed, pay fees and undergo federally approved training every year. This was no big deal for big tax-prep companies or full-time preparers, but it would drive out of business the Mom and Pop tax preparers who hang out a shingle a few weeks a year and make a few thousand dollars helping people with their taxes.
Besides the problematic corporatism of the rules, there were two legal issues here: ethics and authority. Obama appointees were barred from “participat[ing] in any particular matter involving specific parties that is directly and substantially related to my former employer or former clients, including regulations and contracts.” H&R Block, of course, was the leading tax preparer — it supported the new rules.
Obama skirted this rule by hiring Ernst as a “civil servant” rather than a political appointee. (Ernst’s civil service career didn’t last two years.)
More importantly, Congress never gave the IRS the authority to regulate tax preparers. It just didn’t. To create these new regs, the Obama administration had to do what it has done with Obamacare again and again: Pretend federal law says something it doesn’t…
Timothy P. Carney, The Washington Examiner’s senior political columnist, can be contacted at email@example.com. His column appears Sunday and Wednesday on washingtonexaminer.com.
- IRS loses appeal on new rules for tax preparers (savannahnow.com)
- [Eugene Volokh] Court strikes down IRS regulation of tax return preparers (washingtonpost.com)
- IRS loses appeal on new rules for tax preparers (thedailyrecord.com)
- IRS loses appeal on new rules for tax preparers (stltoday.com)
- IRS loses appeal on new rules for tax preparers (kansascity.com)
- IRS loses appeal on new rules for tax preparers (bostonherald.com)
- THE JUDICIARY STRIKES BACK: Obama, legislator-in-chief, suffers setback on illegal IRS rules. (pjmedia.com)
- IRS loses appeal on new rules for tax preparers (jsonline.com)
- D.C. Circuit Invalidates IRS’s Regulation of Tax Return Preparers in the Absence of Statutory Authority (taxprof.typepad.com)