Findings
On the record set out in the layers and quarters sections and tabulated in the State, metro and quarter tables on this page, the record establishes the following, in the words of the statute. The findings rest on public orders cited by exhibit identifier; the account they answer rests on a form sentence.
The second quarter of 2020
During the calendar quarter beginning April 1, 2020 and ending June 30, 2020, the operation of the trade or business of employers in veterinary and animal services was partially suspended due to orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19: the veterinary elective-procedure suspensions of Colorado, Minnesota, Oregon, Michigan, Indiana and Utah and the recommencement orders that replaced them (Ex. CO-007; Ex. CO-022; Ex. SEC-26-004; Ex. MN-018; Ex. OR-005; Ex. OR-015; Ex. SEC-26-009; Ex. IN-011; Ex. UT-003), the PPE inventory, surrender, minimization and federal allocation orders (Ex. MN-007; Ex. NJ-006; Ex. SEC-02-010; Ex. FED-074), the stay-at-home orders of more than forty States and the District of Columbia (the State table on this page), the grooming closures of at least fourteen States and their conditioned reopenings (Ex. ME-008; Ex. MN-012; Ex. CO-020; Ex. MA-017; Ex. KY-004; Ex. SEC-18-040; Ex. OK-014; Ex. WV-026; Ex. HI-008; Ex. IL-005; Ex. NY-090; Ex. MET-LA-032; Ex. MET-DFW-007; Ex. MET-HNL-009), the telemedicine and licensing orders of seven States (Ex. AGY-ST-AGRICULTURE-PARKS-WILDLIFE-091; Ex. PA-091; Ex. CO-088; Ex. ME-014; Ex. HI-007; Ex. AGY-ST-HEALTH-BOARDS-029; Ex. TN-017), and the leave mandate and school and child-care closures on the workforce (Ex. FED-170; Ex. FED-171). The portion suspended was more than nominal on the orders' own terms: the elective and non-essential clinical line for five to eight weeks in six States, the grooming line in at least fourteen, the waiting room everywhere, the PPE supply by inventory and allocation, and the customer base by confinement to enumerated purposes.237
The third quarter of 2020
During the calendar quarter beginning July 1, 2020 and ending September 30, 2020, the operation of the trade or business of employers in this industry was partially suspended due to orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19: the recommencement orders of Colorado, Minnesota and Oregon conditioning every elective procedure on a written plan, PPE adequacy, screening and consent (Ex. CO-022; Ex. MN-018; Ex. OR-015), the face-covering orders naming "veterinary clinic" in Pennsylvania and Kansas and reaching veterinary clinics by name in California and Delaware, workplace infection-prevention and exposure-control requirements on the clinic's premises (Ex. PA-015; Ex. KS-030; Ex. KS-081; Ex. KS-088; Ex. CA-016; Ex. DE-017), the Virginia workplace standard classifying "veterinary settings" (Ex. VA-036), the statewide face-covering mandates with business enforcement duties in more than thirty States (Ex. MN-027; Ex. CO-031; Ex. WA-040; Ex. IL-013; Ex. OH-030; Ex. KY-022; Ex. MI-039; Ex. MI-040; Ex. NM-023; Ex. NM-032 and the State table on this page), the appointment-only, capacity and curbside conditions on grooming and boarding (Ex. SEC-18-040; Ex. KY-017; Ex. HI-008; Ex. HI-010; Ex. HI-011; Ex. MET-BAL-054; Ex. MET-SEA-029; Ex. WA-034; Ex. CO-020), the telework mandates of the closure States, the telemedicine and licensing orders (Ex. HI-007; Ex. ME-014; Ex. PA-091; Ex. AGY-ST-HEALTH-BOARDS-029), the leave mandate (Ex. FED-170), the federal supply, border and entry orders (Ex. FED-077; Ex. FED-074; Ex. FED-220; Ex. FED-221; Ex. FED-222; Ex. FED-243; Ex. FED-244; Ex. FED-245; Ex. FED-200; Ex. FED-201) and the eviction moratorium (Ex. FED-022). A quarter in which every customer entering a veterinary clinic in Pennsylvania and Kansas was masked by name under those States' exposure-control orders, every elective procedure in three States ran under a written plan and owner consent, and every grooming room ran by appointment is not a quarter without orders.
The fourth quarter of 2020
During the calendar quarter beginning October 1, 2020 and ending December 31, 2020, the operation of the trade or business of employers in this industry was partially suspended due to orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19: the recommencement orders (Ex. CO-022; Ex. MN-018; Ex. OR-015), the MIOSHA emergency rules and MDHHS orders naming "veterinary clinics" (Ex. MI-054; Ex. MI-059; Ex. MI-062), Oregon OSHA's Appendix A-10 "Veterinary Care" (Ex. OR-032), Colorado's Level Red order confining veterinary settings to ten percent and grooming to twenty-five percent (Ex. CO-037), New Mexico's order that "[a]nimal grooming services cannot operate under any circumstances" (Ex. NM-040), Pennsylvania's Updated Face Coverings Order and telework mandate (Ex. PA-020; Ex. PA-022), California's Regional Stay at Home Order and section 3205 (Ex. MET-LA-077; Ex. MET-LA-034; Ex. CA-024), the Virginia standard (Ex. VA-036), the winter face-covering mandates of Iowa, Wyoming, Hawaii, Kansas, Utah, Montana, North Dakota and New Hampshire, airborne-transmission controls on every indoor public space (Ex. IA-030; Ex. WY-040; Ex. HI-016; Ex. KS-036; Ex. UT-029; Ex. MT-016; Ex. MT-018; Ex. ND-061; Ex. ND-066; Ex. NH-031 and the State table on this page), the telemedicine chain (Ex. AGY-ST-HEALTH-BOARDS-035; Ex. ME-014; Ex. PA-091; Ex. KY-046), the leave mandate to December 31 (Ex. FED-170), the federal supply, border and eviction orders (Ex. FED-078; Ex. FED-022) and the gathering and telework orders of every re-tightening State (the State table on this page). A quarter in which Michigan wrote "veterinary clinics" into its workplace rules and waiting-room limits and Oregon wrote "Veterinary Care" into its workplace rule, one State confined veterinary settings to ten percent occupancy and one closed grooming "under any circumstances" is not a quarter without orders.
The first quarter of 2021
During the calendar quarter beginning January 1, 2021 and ending March 31, 2021, the operation of the trade or business of employers in this industry was partially suspended due to orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19: the recommencement orders (Ex. CO-022 (as amended through the Twelfth Amended order in force in the quarter); Ex. MN-018; Ex. OR-015), the workplace rules of Michigan, Oregon, Virginia and California (Ex. MI-054; Ex. OR-032; Ex. VA-037; Ex. CA-024), the waiting-room and face-covering orders naming veterinary clinics in Michigan, Pennsylvania, Kansas, California, Delaware and Brookings, South Dakota, the exposure controls those jurisdictions placed on the clinic's premises (Ex. MI-059 as carried by Ex. MI-062; Ex. MI-066; Ex. MI-067; Ex. PA-020; Ex. KS-030; Ex. CA-016; Ex. DE-017; Ex. SD-078), Colorado's Dial (Ex. CO-038; Ex. CO-039; Ex. CO-057), the winter frameworks of California, Oregon, Washington, New Mexico and the Northeast (the State table on this page), the telemedicine and licensing orders (Ex. AGY-ST-HEALTH-BOARDS-037; Ex. HI-019; Ex. ME-014; Ex. PA-091; Ex. KY-046), the PREP Act Seventh Amendment redeploying the industry's licensed workforce (Ex. SEC-26-003), the federal conveyance, entry, testing and workplace orders (Ex. FED-020; Ex. FED-051; Ex. FED-207; Ex. FED-042; Ex. FED-060; Ex. FED-270) and the school and child-care orders of the 2020-21 year (the State table on this page). Congress re-enacted the clause for the third and fourth quarters of 2021 during this quarter, on March 11, 2021, ten days after the Notice was released.238 A quarter that opened under every winter instrument, added a permanent workplace standard naming "veterinary settings" and a federal face-covering regime on every commute, and redeployed the industry's licensed workforce to vaccination is not a quarter without orders.
The second quarter of 2021
During the calendar quarter beginning April 1, 2021 and ending June 30, 2021, the operation of the trade or business of employers in this industry was partially suspended due to orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19: the recommencement orders through their expiry on April 16, May 27 and June 30 (Ex. CO-094; Ex. MN-018; Ex. OR-015; Ex. OR-043), the workplace rules of Michigan to June 22, Oregon, Virginia and California (Ex. MI-054; Ex. MI-074; Ex. OR-041; Ex. OR-044; Ex. VA-037; Ex. CA-024), the face-covering orders naming veterinary facilities in Pennsylvania to June 28, Delaware to July 12 and Michigan to June 22, exposure controls on the facility's premises (Ex. PA-020; Ex. PA-100; Ex. DE-038; Ex. MI-071), Kentucky's pet-care requirements to June 11 (Ex. SEC-18-040), the telemedicine and licensing regimes extended by the legislatures of Pennsylvania and Maine and by the Department of Consumer Affairs of California (Ex. AGY-ST-HEALTH-BOARDS-037; Ex. HI-023; Ex. ME-014; Ex. ME-060; Ex. PA-040; Ex. KY-046), the federal conveyance, entry, testing, border, workplace and supply orders (Ex. FED-020; Ex. FED-051; Ex. FED-208; Ex. FED-042; Ex. FED-232; Ex. FED-255; Ex. FED-060; Ex. FED-271; Ex. FED-078), the PREP Act designation (Ex. SEC-26-003) and the general regimes of the States through their stepped expiry between April 4 and June 30, 2021 (the State table on this page). A quarter in which the last recommencement order lifted on its final day, and the workplace standards of three States, the telemedicine regimes of five and the federal border and conveyance orders lifted not at all, is not a quarter without orders.
The third quarter of 2021
During the calendar quarter beginning July 1, 2021 and ending September 30, 2021, the operation of the trade or business of employers in this industry was partially suspended due to orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19: the workplace standards of California, Oregon and Virginia with Oregon's restored "Veterinary Clinics" appendix from August 13 (Ex. CA-024; Ex. OR-041; Ex. OR-044; Ex. OR-049; Ex. VA-037; Ex. VA-038), the federal importation, scarce-materials and respirator orders and the vaccinator designation in force on every day of the quarter (Ex. AGY-FED-HEALTH-OTHER-126; Ex. ECO-A-071; Ex. AGY-FED-HEALTH-OTHER-048; Ex. SEC-26-003), the federal conveyance, testing, entry and border orders (Ex. FED-020; Ex. FED-051; Ex. FED-052; Ex. FED-042; Ex. FED-207; Ex. FED-208; Ex. FED-232; Ex. FED-233; Ex. FED-234; Ex. FED-235; Ex. FED-255; Ex. FED-256; Ex. FED-257; Ex. FED-258), the indoor face-covering orders of Louisiana, Oregon, New Mexico, Washington, Illinois, Nevada, Hawaii, the District of Columbia and Douglas County, Kansas, airborne-transmission controls carrying entry, business-enforcement and COVID-Safe-Practices conditions (Ex. LA-036; Ex. LA-038; Ex. LA-040; Ex. OR-048; Ex. NM-067; Ex. NM-070; Ex. WA-078; Ex. IL-042; Ex. IL-043; Ex. NV-041; Ex. HI-016; Ex. HI-023; Ex. HI-024; Ex. DC-057; Ex. KS-095), Delaware's veterinary-facility face-covering and employee-exclusion requirements to July 12 (Ex. DE-038), the DEA exceptions and the telemedicine and licensing instruments of California, Pennsylvania, Maine and Hawaii, under whose terms alone a licensee could lawfully examine and prescribe without the in-person encounter the orders had made impossible, and Kentucky's Board of Veterinary Examiners Order of April 16, 2020 as ratified and extended by the General Assembly (Ex. AGY-FED-HEALTH-OTHER-009; Ex. AGY-FED-HEALTH-OTHER-010; Ex. AGY-FED-HEALTH-OTHER-011; Ex. AGY-ST-HEALTH-BOARDS-040; Ex. AGY-ST-HEALTH-BOARDS-042; Ex. AGY-ST-HEALTH-BOARDS-037; Ex. PA-040; Ex. PA-043; Ex. ME-060; Ex. KY-046; Ex. KY-056; Ex. HI-023; Ex. HI-024; Ex. HI-026), the reinstatements of more than twenty-five metropolitan areas (Ex. MET-LA-018; Ex. MET-SFO-010; Ex. MET-SAC-015; Ex. MET-DFW-028; Ex. MET-AUS-023; Ex. MET-SAT-067; Ex. MET-HOU-038; Ex. MET-SEA-018; Ex. MET-HNL-038; Ex. MET-STL-021; Ex. MET-CHI-026; Ex. MET-BAL-017; Ex. MET-DEN-023; Ex. MET-PHL-019; Ex. MET-NYC-017; Ex. MET-BOS-013; Ex. MET-DCM-023; Ex. MET-MSY-027; Ex. MET-LAS-006; Ex. MET-KC-002; Ex. MET-DET-013; Ex. MET-MSP-041; Ex. MET-MIA-020; Ex. MET-BNA-076; Ex. MET-SLC-029; Ex. MET-SLC-030; Ex. MET-PHX-016 and the metro table on this page), the State emergencies and the continuing and preemptive orders of the remaining States (Ex. CO-041; Ex. TX-036; Ex. FL-030; Ex. GA-041; Ex. AZ-036; Ex. AZ-044; Ex. NJ-050; Ex. NY-133; Ex. NY-071; Ex. CT-050; Ex. MD-031; Ex. MN-041; Ex. IN-068; Ex. KY-001 and the State table on this page) and the school, child-care and quarantine orders on the workforce (Ex. ECO-B-029; Ex. ECO-B-036; Ex. ECO-B-054; Ex. ECO-B-066; Ex. ECO-B-080; Ex. ECO-B-087; Ex. CA-034; Ex. PA-042; Ex. VA-044; Ex. KY-052; Ex. DE-044; Ex. LA-054; Ex. OR-045; Ex. WA-075; Ex. DC-074; Ex. NM-068; Ex. MI-081; Ex. IN-092; Ex. KS-057). The suspension compelled by the orders of 2020 and the first half of 2021 had not been restored when the quarter began, and the orders named here were in force during it. The Service's statement that no orders were in effect describes a quarter that did not occur.239
The standards
Each finding is made on a preponderance of the evidence, which is the only standard that governs a refundable credit in a refund forum. In a refund suit the court redetermines the entire liability and "the statute will control"; the taxpayer bears the burden of proving the amount it is entitled to recover; the Commissioner's determination "has the support of a presumption of correctness" that the taxpayer rebuts "by a preponderance of the evidence"; and "a shift in the burden of preponderance has real significance only in the rare event of an evidentiary tie."240 Section 7454(a) places the burden of proof on the Secretary in any proceeding involving fraud, to be carried by clear and convincing evidence; no such issue arises on a claim supported by the public orders catalogued here.241 The positions taken in this analysis have substantial authority within the meaning of Treas. Reg. § 1.6662-4(d): they rest on the statutory text, on Tri-State, on the Supreme Court's but-for causation cases, on the United States' representations in two courts and on the Notice's own favorable provisions, each an authority the regulation names, and "a taxpayer may have substantial authority for a position that is supported only by a well-reasoned construction of the applicable statutory provision."242 They have, a fortiori, a reasonable basis within the meaning of Treas. Reg. § 1.6662-3(b)(3), which is satisfied by a position "reasonably based on one or more of the authorities" the substantial-authority regulation lists.243 A claim so supported rests on reasonable cause and good faith under section 6664(c)(1), and the erroneous-claim penalty of section 6676(a), which Pub. L. 119-21, § 70605(f) extended to "income or employment tax" for claims made after July 4, 2025, does not apply where "it is shown that the claim for such excessive amount is due to reasonable cause."244 Section 6702(a) reaches a submission that "does not contain information on which the substantial correctness of the self-assessment may be judged" or that rests on a position the Secretary has identified as frivolous in Notice 2010-33; a Form 941-X supported by the Library and the statute is the opposite of such a submission, and no listed frivolous position concerns the credit or the meaning of a governmental order.245 The governmental orders on which the findings rest are public records of which a court takes judicial notice under Fed. R. Evid. 201(b); the United States' statements in Doc. 44, the Brief for Appellees, the hearing transcript and Tri-State are statements of a party-opponent under Fed. R. Evid. 801(d)(2), because a Government brief filed in one federal court "establish[es] the position of the United States and not merely the views of its agents," a publication of the competent government department is "an admissible party admission," and "statements of fact contained in a brief may be considered admissions of the party."246 Judicial estoppel is available against the United States where a court accepted the position it now contradicts, and Doc. 49 records that acceptance on its face; and the Service is bound by its own directive to the Notice's favorable provisions "to the same extent as a revenue ruling."247 The COVID Project holds the United States to the positions it took to obtain judgment.
The instruments cited on this page are held in the Library, organized by layer: Federal (FED-###), the fifty States and the District of Columbia (two-letter State prefix and number), the metropolitan areas (MET-CODE-###), the sector files (SEC-##-###, of which SEC-26 is this industry's), the ecosystem files (ECO-A for supply, ECO-B for workforce and schools, ECO-C for courts, travel and eviction), the foreign instruments (FOR-###), the legal authorities (LAW-###), the Government's positions (GOV-###), the standing duties (DUT-) and the agency records (AGY-CLUSTER-###). Each exhibit carries an identifier, an issuer, an instrument name, dates of issue, effect and end, the quarters in force, the limitation types, a grade ("Primary source read" or a secondary-source grade), the means of retrieval, a source URL and, where retrieved, the exhibit file itself. The first citation of each instrument gives the issuer, the instrument, the pin and the date; later citations give the exhibit identifier. Where the Library records a State's veterinary-specific status only by category, this page states the general regime by category and says so.