The Tax Court Gives a Primer on Listed Transactions while Invalidating the Conservation Easement Listed Transaction Notice by Robert S. Horwitz
The Supreme Court emphasized that it was not inclined “to carve out an approach to administrative review good for tax law only” in Mayo Found. for Med. Educ. & Rsch. v. United States, 562 U.S. 44, 55 (2011). That the IRS is subject to the Administrative Procedures Act (APA) in the same way as other administrative agencies has become increasingly clear. In CIC Services, LLC v. IRS, 141 S.Ct. 1582 (2021), the Court held that a material advisor can maintain an action challenging the IRS’s listed transaction notice for micro-captive insurance companies as violative of the APA. Earlier this year, the Sixth Circuit in Mann Construction, Inc. v. United States, 24 F.4th 1138 (6th Cir. 2022), held that Notice 2007-83, designating as a listed transaction certain employee-benefit plans involving life insurance policies, was invalid because it was issued in violation of the APA’s notice-and-comment rulemaking requirements.