KPMG article: Strict construction and the interpretation of tax regulations

In Loper Bright, the Supreme Court upended 40 years of precedent on the deference owed to agency regulations by overruling the Chevron doctrine. Much has been written about the potential impact of Loper Bright on statutory interpretation, but now is an opportune time to revisit interpretation in the regulatory context. Loper Bright directs courts to consider what the statute means, but taxpayers and courts are often faced with a separate challenge: figuring out what a regulation means.

Read a September 2025 article* prepared by KPMG LLP tax professionals that provides:

• A brief background on Chevron, Loper Bright, and the history of judicial deference to agencies’ interpretations of their own regulations
• A discussion of the strict construction canon’s historical roots and its role in the interpretation of Treasury regulations, including the Tax Court’s approach in its recent opinions in SN Worthington and Bloomberg
• Insights for taxpayers in disputes with the IRS over the interpretation and applicability of tax regulations

* This article originally appeared in Tax Notes Federal (September 15, 2025) and is provided with permission.