Arenjay Corporation, A. James Sedwick, Jr., Tax Matters Person v. Commissioner of Internal Revenue

ALVIN B. RUBIN, Circuit Judge:

Declining the importunity of the Commissioner of Internal Revenue that we interpret a statute clear on its face to convey a different meaning because in the Commissioner’s opinion, unsupported by record evidence, the patent reading would lead to absurd consequences, we hold that the procedural provisions of subchapter C of the Internal Revenue Code relating to partnerships apply to subchapter S corporations, and reverse the contrary Tax Court judgment.

In 1982, Congress amended the Internal Revenue Code to provide for unified treatment of subchapter S items among…