Findings
The operation of the manufacturing industry of the United States was partially suspended in each of the six calendar quarters from April 1, 2020 through September 30, 2021 due to orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19. The orders are in the Library by exhibit number; their operative clauses are quoted in the layer and quarter sections; the functions they reached are stated function by function; the mechanisms and the continuing-suspension analysis are stated under the interconnected economy; the Service's grounds are answered above; and the United States' own positions, which this analysis holds it to, are collected on the Government's own words page. What follows states the findings in the words of the statute, the standards they satisfy and the records that support them.
The findings
The second quarter of 2020
During the calendar quarter beginning April 1, 2020 and ending June 30, 2020, orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19, namely the closure orders of Michigan, Pennsylvania, New York, Illinois, Ohio, Washington, California, Massachusetts, Minnesota, Wisconsin and Kentucky and the stay-home, telework, minimum-staffing and distancing orders of New Jersey, Indiana, Virginia and Oregon, and their counterparts (Ex. MI-011; Ex. PA-002; Ex. NY-002; Ex. NY-003; Ex. SEC-10-034; Ex. OH-011; Ex. OH-014; Ex. WA-016; Ex. CA-007; Ex. MA-008; Ex. MN-010; Ex. WI-002; Ex. KY-010; Ex. SEC-10-023; Ex. IN-006; Ex. VA-004; Ex. OR-007), the restart orders that reopened the floor on conditions (Ex. MI-026; Ex. PA-008; Ex. SEC-10-020; Ex. SEC-10-044; Ex. SEC-10-046; Ex. SEC-10-051; Ex. SEC-10-053; Ex. OH-019; Ex. WA-034; Ex. VA-010), the Defense Production Act orders and the FEMA allocation rule (Ex. SEC-10-010; Ex. SEC-10-011; Ex. SEC-10-012; Ex. SEC-10-005; Ex. SEC-10-004), the entry proclamations, the land-border prohibitions and the worker-visa suspension (Ex. FED-202; Ex. FED-203; Ex. FED-204; Ex. FED-205; the land-border notifications of March 24, 2020 recited in Ex. FED-220; Ex. FED-213), the FFCRA mandate (Ex. FED-170) and the gathering, stay-home, school and travel orders of every State, caused a temporary delay, interruption or termination of a more than nominal portion of the operations of manufacturers throughout the United States.
The third quarter of 2020
During the calendar quarter beginning July 1, 2020 and ending September 30, 2020, orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19, namely the restart conditions carried in every closure State (Ex. MI-031; Ex. PA-008; Ex. PA-016; Ex. SEC-10-020; Ex. SEC-10-037; Ex. SEC-10-045; Ex. SEC-10-046; Ex. SEC-10-051; Ex. SEC-10-053; Ex. WA-034; Ex. CA-015), Virginia's Emergency Temporary Standard (Ex. SEC-10-042), the statewide face-covering and exposure-control orders of thirty-three States (Ex. PA-015; Ex. OH-030; Ex. KY-022; Ex. TX-022; Ex. AR-009; Ex. NV-019 and their counterparts in the State table; as compiled in Ex. LAW-231), the gathering caps of every State, the travel quarantines of New York, New Jersey, Connecticut, Massachusetts, Hawaii and Chicago (Ex. NY-006; Ex. MA-025; Ex. HI-003; Ex. MET-CHI-019), the entry proclamations and land-border prohibitions, the FEMA rule as extended (Ex. SEC-10-008) and the FFCRA mandate, caused a temporary delay, interruption or termination of a more than nominal portion of the operations of manufacturers throughout the United States.
The fourth quarter of 2020
During the calendar quarter beginning October 1, 2020 and ending December 31, 2020, orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19, namely the MIOSHA emergency rules and the MDHHS orders (Ex. SEC-10-024; Ex. AGY-ST-LABOR-WORKPLACE-062; Ex. MI-054; Ex. MI-050; Ex. MI-060; Ex. MI-062), the Cal/OSHA standard (Ex. SEC-10-039), the Oregon OSHA rule (Ex. SEC-10-054), the Virginia standard (Ex. SEC-10-042), New Jersey's Executive Order 192 (Ex. SEC-10-021), Pennsylvania's mitigation and elective-procedure orders (Ex. PA-022; Ex. PA-025), Illinois' Tier 3 (Ex. SEC-10-038), Minnesota's Executive Order 20-99 (Ex. MN-032), Washington's November 17 restrictions (Ex. WA-047), California's Regional Stay at Home Order (Ex. CA-020), Kentucky's Executive Order 2020-968 (Ex. KY-033), the winter re-tightening orders of Massachusetts, Oregon, Colorado, New Mexico and Utah (Ex. MA-040; Ex. OR-035; Ex. CO-081; Ex. NM-039; Ex. UT-029), the entry proclamations and land-border prohibitions, the FEMA rule and the FFCRA mandate to December 31, caused a temporary delay, interruption or termination of a more than nominal portion of the operations of manufacturers throughout the United States.
The first quarter of 2021
During the calendar quarter beginning January 1, 2021 and ending March 31, 2021, orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19, namely the federal conveyance order (Ex. FED-020), the pre-departure testing order (Ex. FED-042), Proclamation 10143 and its predecessors (Ex. FED-207), the land-border prohibitions (Ex. FED-222), the worker-visa suspension to March 31 (Ex. FED-213), the FRA's Emergency Order No. 32 (Ex. AGY-AVIATION-SURFACE-014), the conveyance order's face-covering requirement, one of its airborne-transmission controls, at every sea port as the Coast Guard's bulletin applied it from March 22 (Ex. FED-020; Ex. AGY-USCG-PORTS-033), the FEMA rule to June 30 (Ex. SEC-10-009), OSHA's National Emphasis Program from March 12 (Ex. SEC-10-014), the MIOSHA rules, the Cal/OSHA, Oregon OSHA and Virginia standards (Ex. SEC-10-039; Ex. SEC-10-054; Ex. SEC-10-043), Pennsylvania's mitigation orders to April 3 (Ex. PA-022), New Jersey's Executive Order 192, the capacity and gathering caps of every closure State through their dates, and the State face-covering and exposure-control orders, caused a temporary delay, interruption or termination of a more than nominal portion of the operations of manufacturers throughout the United States.
The second quarter of 2021
During the calendar quarter beginning April 1, 2021 and ending June 30, 2021, orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19, namely the federal conveyance order and its directives (Ex. FED-020; Ex. FED-051), the testing order, the entry proclamations adding India (Ex. FED-208), the land-border prohibitions (Ex. FED-231; Ex. FED-232), the FEMA rule to June 30, the National Emphasis Program, the Healthcare Emergency Temporary Standard from June 21 (Ex. FED-080), the MIOSHA rules to June 22 (Ex. MI-076; Ex. AGY-ST-LABOR-WORKPLACE-063), the Cal/OSHA standard readopted June 17 (Ex. SEC-10-041), Oregon's permanent rule from May 4 (Ex. SEC-10-055), the Virginia standard, New Jersey's Executive Orders 192 and 243 (Ex. SEC-10-021; Ex. SEC-10-022), Pennsylvania's orders to May 31 and June 28 (Ex. PA-035; Ex. PA-100), Minnesota's Preparedness Plan requirement to June 30 (Ex. MN-038), Massachusetts' standards to May 29 (Ex. MA-048), Kentucky's requirements to June 11 (Ex. KY-049), Illinois' Bridge Phase to June 11 (Ex. IL-037), Washington's Phase 3 to June 30 (Ex. WA-065), California's Blueprint to June 15 (Ex. CA-027) and Oregon's county tiers to June 30 (Ex. OR-043), caused a temporary delay, interruption or termination of a more than nominal portion of the operations of manufacturers throughout the United States.
The third quarter of 2021
During the calendar quarter beginning July 1, 2021 and ending September 30, 2021, orders from appropriate governmental authorities limiting commerce, travel and group meetings due to COVID-19, namely the federal conveyance order and its directives (Ex. FED-020; Ex. FED-051; Ex. FED-052), the entry proclamations (Ex. FED-207; Ex. FED-208), the land-border prohibitions of every month (Ex. FED-233; Ex. FED-234; Ex. FED-235), the testing and Title 42 orders (Ex. FED-042; Ex. FED-038), the Defense Production Act delegations and the scarce-materials designation (Ex. SEC-10-001; Ex. ECO-A-071), the National Emphasis Program (Ex. SEC-10-015), the Healthcare Emergency Temporary Standard (Ex. FED-080), the federal workplace and contractor rules (Ex. FED-272), the conveyance order as the Coast Guard's bulletins applied it at every sea port and the FRA's rail order (Ex. FED-020; Ex. AGY-USCG-PORTS-037, the implementing bulletin; Ex. AGY-AVIATION-SURFACE-014), the California, Oregon and Virginia workplace standards (Ex. SEC-10-041; Ex. SEC-10-055; Ex. SEC-10-056; Ex. SEC-10-057; Ex. SEC-10-043), the New York HERO Act plans (Ex. SEC-10-031), the face-covering and exposure-control orders of Washington, Illinois, Nevada, Hawaii, Louisiana, New Mexico, Oregon and the District of Columbia (Ex. WA-078; Ex. SEC-10-036; Ex. NV-041; Ex. HI-024; Ex. LA-036; Ex. NM-067; Ex. OR-048; Ex. DC-057) and of the metros named in the third-quarter section (Ex. MET-LA-018; Ex. MET-SFO-071; Ex. MET-SAC-015; Ex. MET-STL-021; Ex. MET-KC-002; Ex. MET-MSY-027; Ex. MET-CHI-026; Ex. MET-PHL-019; Ex. MET-BAL-017; Ex. MET-DCM-023; Ex. MET-BOS-013; Ex. MET-CLT-001; Ex. MET-CMH-050; Ex. MET-LAS-006), the vaccination-proof conditions of New York City, San Francisco, New Orleans and Honolulu (Ex. MET-NYC-017; Ex. MET-SFO-011; Ex. MET-MSY-029; Ex. MET-HNL-035), the statutes and orders of the preemption States regulating every business's dealings with its customers (Ex. TX-036; Ex. FL-030; Ex. GA-043), the health-care-worker, school and child-care orders on the industry's counterparties and workforce (Ex. ECO-B-083; Ex. ECO-B-055; Ex. ECO-B-029; Ex. ECO-B-054) and the tribal and territorial orders (Ex. AGY-TRIBAL-054; Ex. AGY-TERRITORIES-071), caused a temporary delay, interruption or termination of a more than nominal portion of the operations of manufacturers throughout the United States.
The standards satisfied
Preponderance
An employer in a refund suit carries its burden by a preponderance of the evidence, and the court redetermines the liability de novo. The orders are public records; their existence, dates and terms are facts not subject to reasonable dispute and are subject to judicial notice under Fed. R. Evid. 201(b). The findings above rest on the instruments themselves and on the public statistical record of the industry; they rest on no private figures and ask no trier of fact to take anything on faith.193
Section 7454(a) and the penalty provisions
Where fraud is alleged, the burden is on the Secretary, by clear and convincing evidence. No penalty under section 6662, section 6676 as amended by Pub. L. 119-21 § 70605, or section 6702 can attach to a return position that rests on the text of the statute, on Tri-State's reading of it, on the Notice's own words where they help the employer, and on orders whose existence the record establishes; such a position has substantial authority and a reasonable basis under Treas. Reg. § 1.6662-4 and reasonable cause under section 6664(c), and it appears nowhere on the list of frivolous positions in Notice 2010-33.194
The United States' positions
The findings apply the rules the United States has stated in court: the statute controls and the Notice has no force of law; "due to" is but-for; a suspension is a delay, interruption or termination; a portion is any portion; the ten percent figure is a safe harbor; an order on a third party is an order; the determination is case by case on the facts and circumstances. The COVID Project holds the United States to those positions and asks for nothing that the United States has not already told two federal courts is the law.195
The records
What this analysis supplies
This analysis supplies, for every quarter, the instruments in force, by exhibit, with issuer, date, operative clause and sanction; for every function, the instruments that reached it and the modification each compelled; the mechanisms and the restoration arithmetic from the orders' own steps; the answers to the Service's grounds; and, on the Government's own words page, the United States' positions with pins. Each exhibit is in the Library under the identifier cited, with its source, its dates and its verification grade.
What an employer adds
Nothing on this page states a fact about any particular employer. An employer relying on it adds its own particulars: the States and metros in which its plants, offices and docks sit; the functions above that it performs; the suppliers, customers and carriers whose orders reached it; the dates on which its own restart steps were taken under the orders cited; and the payroll records the credit is computed on. The record builder assembles the instruments for a given State, metro, industry and set of quarters. The orders do the rest.
The Service's sentence
There were no government orders related to COVID-19 in effect during the quarter(s) you claimed ERC which could have fully or partially suspended your trade or business.
For the industry described on this page, in each of the six quarters from April 1, 2020 through September 30, 2021, that sentence describes a period that did not occur.