- Court: United States Supreme Court
- Area(s) of Law: Administrative Law
- Date Filed: June 25, 2015
- Case #: 14-114
- Judge(s)/Court Below: Roberts, C.J., Kennedy, Ginsburg, Breyer, Sotomayor, Kagan, J.J.
- Full Text Opinion
Addressing whether the Affordable Care Act (Act) tax credits are available to taxpayers in states that chose to have a Federal Exchange, the Court held that tax credits are available to taxpayers enrolled under a Federal Exchange.
The Act states that tax credits are available to applicable taxpayers enrolled "in an Exchange established by a state." The Internal Revenue Service (IRS) promulgated a rule in order to make tax credits available through State and Federal Exchanges. Petitioners challenge the rule.
After deciding Congress did not intend to delegate authority to the IRS, the Court applied statutory construction to interpret the phrase's meaning. The statute’s context and overall placement within the statutory scheme, led the Court to determine that Congress intended for the Act to include both State Exchanges and Federal Exchanges. In order to read legislation fairly, the legislative plan must be understood. The statutory purpose of the Act was to advance three major reforms: guaranteed issue and community rating, coverage requirements, and tax credits. The Act’s structure and context illustrate the Legislature’s intent that tax credits be available under both a State Exchange and a Federal Exchange.