Average Joe SCOTUS: CIC Services LLC v. Internal Revenue Service

Back in 2004, Congress decided to charge the commie fucks at the IRS with trying to uncover tax shelters, because it’s never really YOUR money now, is it?

The IRS went about this by requiring accountants to report “reportable transactions” which they would go on to define. If not paid, there would be a hefty fine, we’re calling a tax. November 2016, they included what they called “micro-captive transactions,” which if not reported, would put the IRS gestapo on your ass.

CIC services, a company that does these micro-captive transactions decided to sue, arguing that the IRS’s rule violates the Anti-Injunction Act which says, “no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court by any person, whether or not such person is the person against whom such tax was assessed.”

CIC argued they were harmed, because this rule was enforced without any prior discussion, and therefore they didn’t have time to properly comply with it, and this is against rules set for in the Anti-Injunction Act. While the text of the AIA bars certain taxes, CIC is basically arguing tax rules, that aren’t necessarily taxes, should be barred as well for the same reason, since they consider the fines for violating the rules, also a tax.

As CIC’s counsel stated in summation:

Cameron T. Norris

Thank you, Mr. Chief Justice. Notice 16-66 labels my client’s industry a reportable transaction, a kind of scarlet letter that triggers burdensome reporting requirements and makes it much harder to attract clients. Labeling something a reportable transaction is serious, which is why Congress told the IRS to use notice-and-comment rulemaking.

When the IRS refused to do that, CIC did precisely what we want law-abiding citizens to do: It filed a pre-enforcement suit under the APA, and it is fully complying with the reporting requirements while its case is pending. According to the government, however, what CIC should have done is deliberately violate the tax code.

The government’s path would require CIC’s members to commit a crime, violate their ethical obligations, and convince the IRS to assess it tax penalties.

No law-abiding company or individual would ever do this. Ruling for the government, thus, does not delay judicial review, it denies it altogether.

At the heart of this matter, CIC is basically arguing that the only way they can fight this tax, is to break the law first, by not submitting the info. Then when hit with a fine, challenge that fine in order to get the courts to review it. They obviously think that’s pretty goddamn unfair. They believe they should be able to challenge it before they violate it, which they’re trying to do here, and a judgement for them would give them.

In a unanimous decision, SCOTUS ruled in favor of CIC Services. They can indeed sue without triggering and Anti-Injunction Act. They did the right thing, and they’ve been vindicated.

Hear oral arguments and read about the case here.


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