Briefly: IRS loses appeal over regulation of tax preparers; House panel backs bill to ban in-flight cellphone calls

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Posted: Wednesday, February 12, 2014 12:00 am | Updated: 2:17 pm, Thu Jun 5, 2014.

The U.S. Internal Revenue Service lacks authority to regulate paid tax preparers, a federal appeals panel said Tuesday, upholding a lower-court ruling throwing out licensing rules for as many as 700,000 practitioners.

The IRS issued new rules in 2011 to address concerns about the performance of some preparers. The agency relied for authority on a 1884 law empowering it to “regulate the practice of representatives of persons before the Department of Treasury,” according to the ruling by a three-judge panel in Washington.

In the 125 years after the law's enactment, “the executive branch never interpreted the statute to authorize regulation of tax-return preparers,” U.S. Circuit Judge Brett Kavanaugh wrote for the panel. The law “cannot be stretched so broadly as to encompass authority to regulate” preparers, the court said.

Today's ruling “is a major victory not just for tax preparers but for taxpayers,” said Dan Alban, of the libertarian Institute for Justice in Arlington, Va., who argued the case on behalf three tax preparers challenging the IRS rules. “This is about the freedom to choose your tax preparers. Taxpayers get to choose, not the IRS.”

“The IRS is currently reviewing the decision,” Julianne Breitbeil, an agency spokeswoman, said. “It's critical for taxpayers to be able to rely on quality work from tax preparers.”

The rules imposed standards on preparers who aren't certified public accountants, attorneys or enrolled agents already licensed to practice before the IRS. — Bloomberg News

WASHINGTON — Allowing airline passengers to make cellphone calls in-flight is asking for trouble, lawmakers said Tuesday as a House panel approved a bill to ban such calls.

The bill — passed without opposition by the House Transportation and Infrastructure Committee — requires the Department of Transportation to issue regulations prohibiting such calls. The department has already said it is considering creating such a ban as part of its consumer protection role.

The bill has no impact on the Federal Aviation Administration's decision late last year to allow passengers to email, text, surf the Internet and download data using personal electronic devices during takeoffs and landings.

Phone calls are another matter. Both Republican and Democratic House members said they believe in-flight calls would be noisy and disturbing to other passengers and possibly disruptive.

“Most passengers would like their flights to go by as quickly and quietly as possible,” Rep. Bill Shuster, R-Pa., the committee's chairman and sponsor of the bill, said. — AP

NEW YORK — Chick-fil-A says its plans to serve only chicken raised without antibiotics within the next five years.

The Atlanta-based fast-food chain says it's working with its suppliers to build an adequate supply.

Chick-fil-A said late last year that it was making a number of changes to remove high fructose corn syrup and artificial dyes from its dressings and sauces. — AP

Toyota Motor Corp. is reportedly close to paying a $1 billion fine to settle a four-year federal criminal investigation into allegations of sudden acceleration and whether it properly reported safety complaints to regulators. Meanwhile, Toyota's lawyers are in settlement talks over hundreds of civil suits alleging wrongful deaths or injuries, potentially adding hundreds of millions to the tab.

Previously, Toyota agreed to pay $1.6 billion to settle a class-action case brought by Toyota owners who said that sudden-acceleration problems damaged the value of their vehicles.

The automaker has repeatedly denied any serious safety defect that caused its cars to take off at high speeds, causing accidents that killed or injured occupants.

Now, Toyota appears ready to pay what it takes to move the story off front pages and newscasts.

“Toyota is trying to put this entire episode behind it,” said John Goldberg, a Harvard Law School professor and product liability expert.

Investors and shareholders generally react positively to “closure,” even when that comes at a price, Goldberg said. — The Los Angeles Times

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