PSB Holdings, Inc. - Page 24




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          regulations, did not undergo any public review or comment before            
          its issuance.                                                               
               In accordance with the analysis under United States v. Mead            
          Corp., 533 U.S. 218 (2001), we decline to adopt the exception set           
          forth in Rev. Rul. 90-44, supra.  First, as we have discussed,              
          the exception does not properly interpret the text of the                   
          statutes as written.  See Commissioner v. Schleier, 515 U.S. 323,           
          336 n.8 (1995).  Second, we find in the ruling neither adequate             
          “thoroughness evident in its consideration” nor adequate                    
          “reasoning” as to the presence of the exception in the statutes.            
          See Skidmore v. Swift & Co., supra at 140.  The ruling simply               
          states that the exception was included in the revenue ruling “in            
          order to fulfill the congressional purpose underlying section               
          265(b)” and may be invoked “to clearly reflect the income of the            
          financial institution and to prevent the evasion or avoidance of            
          taxes”.  Rev. Rul. 90-44, 1990-1 C.B. at 57.  Third, the revenue            
          ruling was issued many years after the enactment of the relevant            
          statutes, approximately 8 years after the enactment of section              
          291(a)(3) and (e)(1)(B) and 4 years after the enactment of                  
          section 265(b).                                                             
               We hold that the numerator does not include the tax-exempt             
          obligations purchased and owned by Investments and sustain                  
          petitioner’s reporting position.  We have considered all of the             








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