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claim, the attribution rule set forth in section 1.469-4(a),
Income Tax Regs., is a substantial change from the rules set
forth in the proposed regulations, which, petitioners allege,
means that the Commissioner should have given notice and allowed
comment on the attribution rule pursuant to the APA, 5 U.S.C.
sec. 553(b) and (c) (1994). Because the Commissioner did not,
petitioners conclude, the attribution rule of section 1.469-4(a),
Income Tax Regs., is invalid, which, in turn, invalidates the
recharacterization rule of section 1.469-2(f)(6), Income Tax
Regs., to the extent that it attributes the activities of a C
corporation to an individual who materially participates in that
activity.
We disagree with petitioners' assertion that sections
1.469-2(f)(6) and 1.469-4(a), Income Tax Regs., are invalid as
applied in the instant case. With respect to section
1.469-2(f)(6), Income Tax Regs., and section 469 in general, the
uncertainty as to the breadth of a provision does not mean that
it is inoperative until regulations are issued clarifying the
breadth of it. See SEC v. Chenery Corp., 332 U.S. 194, 201-203
(1947); Jacks v. Crabtree, 114 F.3d 983, 985-986 (9th Cir. 1997);
Trans City Life Ins. Co. v. Commissioner, 106 T.C. 274, 299-300
(1996). In the absence of regulations, a provision may be
interpreted in light of all pertinent evidence, textual and
contextual, of its meaning. See Commissioner v. Soliman,
506 U.S. 168, 174 (1993); Crane v. Commissioner, 331 U.S. 1, 6-7
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