Law360 quoted Gray Proctor in a recent article reviewing the top federal tax cases of 2025 so far.
Gray discusses Commissioner v. Zuch, a case in which a divorced woman challenged the nearly $28,000 in taxes the IRS insisted she owed. The IRS satisfied the amounts due from tax refunds from subsequent years while the dispute was in Tax Court. The Third Circuit Court of Appeals had ruled that the Tax Court was permitted to review the underlying liability issue of who owed the tax, even though the IRS had eliminated the debt by withholding tax refunds. The Supreme Court reversed, ruling in June 2025 that “because there was no longer a proposed levy, the Tax Court properly concluded that it lacked jurisdiction to resolve questions about Zuch’s disputed tax liability.”
Though the issue in the case may affect fewer than 100 taxpayers a year, Gray explained that Zuch nevertheless “moves the court’s anti-agency/pro-Article III power agenda forward, to declare that agency courts are not going to have any more power than Congress explicitly gives.”
Gray also commented on a case out of the U.S. District Court for the District of Arizona, ERC Today et al. v. McInelly et al. The case was brought by two tax promotion companies who objected to the IRS’s denial of Employee Retention Credit claims based on an automated system for assessing risk factors for fraudulent claims. The district court ruled that the companies lacked standing to bring the case because they were merely intermediaries for taxpayers seeking ERC refunds, not the affected taxpayers themselves.
Gray described the ERC Today case as having the potential to “embolden the IRS” in using its automated risking system to issue boilerplate denials of ERC claims.
The full article can be found here.
About Gray
Gray is an experienced and accomplished appellate advocate who represents clients facing tax and tax-adjacent legal issues at Kostelanetz LLP.
