- 38 -
failing to mention subtraction of operating expenses in
promulgating section 31.3121(b)(20)-1, Employment Tax Regs.,
thereby making Rev. Rul. 77-102, supra, inconsistent with the
regulation.
Even though revenue rulings do not have the force of law
and are merely statements of the Commissioner’s litigating and
administrative position, Dixon v. United States, 381 U.S. 68, 73
(1965), such rulings constitute a body of experience and informed
judgment to which courts may properly resort for guidance in the
interpretation of revenue statutes and regulations, Skidmore v.
Swift & Co., 323 U.S. 134, 140 (1944); Esden v. Bank of Boston,
229 F.3d 154, 169 n.19 (2d Cir. 2000); Gordon v. Commissioner, 88
T.C. 630, 636 n.3 (1987).
As it pertains to the subtraction of operating expenses,
Rev. Rul. 77-102, supra, has been relied upon and followed by the
industry for more than 27 years without any substantial change.
During the last 27 years, neither Congress nor the Secretary took
advantage of the opportunity to invalidate Rev. Rul. 77-102,
supra. There has been no announcement that the revenue ruling
has fallen into desuetude or has been revoked, modified, or
invalidated by section 3121(b)(20), section 31.3121(b)(20)-1,
Employment Tax Regs., or a new revenue ruling. See Auto. Club of
Mich. v. Commissioner, 353 U.S. 180, 184 (1957); cf. Rauenhorst
v. Commissioner, 119 T.C. 157, 170 (2002). Indeed, the
Page: Previous 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 NextLast modified: May 25, 2011