The Perfect Process Is the Enemy of the Good Tax: Tax\u27s Exceptional Regulatory Process

Many courts and academics critique existing tax exceptionalism or the ability of the federal income tax to be created, applied, or interpreted differently from other laws. Critics have successfully complained that the Treasury Department, and the IRS as a bureau of the Department, issues guidance implementing the Internal Revenue Code using different processes from those required by the Administrative Procedure Act (APA). At the same time, courts are increasing the level of deference given to this guidance to conform to that given other agencies. This article responds to these critics by urging they re-focus their attention on the objectives of administrative law and comparisons to other agencies\u27 procedures as opposed to limiting their assessment to the APA. Moreover, this article examines some risks of forcing procedural uniformity on the tax system. First, the agency would risk being inundated with information to comply with the APA. The agency could be captured by those submitting information, be forced to reduce the amount of guidance it issues, and be thwarted in its ability to accomplish other agency directives. Second, pushing the agency to develop ex ante regulations responsive to commentators, including those seeking to use the procedure to secure personal tax reduction, threatens established heuristics implementing the complicated Internal Revenue Code. To satisfy the APA\u27s procedures risks minimizing the agency\u27s use of its expertise to carry out its congressional-established mission