AOD 2023-1: IRS acquiescence to Fifth Circuit decision, tax on exports of domestic crude oil held unconstitutional

The IRS will follow the decision in all circuits.

Tax on exports of domestic crude oil held unconstitutional

Action on Decision (AOD) 2023-1 reflects the IRS acquiescence to a March 2022 decision of the U.S. Court of Appeals for the Fifth Circuit.

The Fifth Circuit affirmed a federal district court’s grant of summary judgment to the taxpayer that the levy imposed on exports of domestic crude oil under section 4611(b) is “tax” (and not a fee) and as such was unconstitutional. Read TaxNewsFlash

A synopsis of the AOD 2023-1 (which appears in Internal Revenue Bulletin 2023-10 [PDF 996 KB] (March 6, 2023)) explains that:

Although the Service disagrees with the decision, in the interest of sound tax administration, it will follow the decision in all circuits



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