[Editor Note: This MPEP section is applicable to all applications. For applications subject to the first inventor to file (FITF) provisions of the AIA, the relevant time is “before the effective filing date of the claimed invention”. For applications subject to pre-AIA 35 U.S.C. 102, the relevant time is “at the time of the invention”. Phillips v. AWH Corp., 415 F.3d 1303, 1313, 75 USPQ2d 1321, 1326 (Fed. Cir. 2005). See also MPEP § 2150 et seq. Many of the court decisions discussed in this section involved applications or patents subject to pre-AIA 35 U.S.C. 102. These court decisions may be applicable to applications and patents subject to AIA 35 U.S.C. 102 but the relevant time is before the effective filing date of the claimed invention and not at the time of the invention.]

I. OVERVIEW

The Leahy-Smith America Invents Act (AIA), Public Law 112-29, sec. 14, 125 Stat. 284 (September 16, 2011) provides that for purposes of evaluating an invention for novelty and nonobviousness under 35 U.S.C. 102 and 35 U.S.C. 103, any strategy for reducing, avoiding, or deferring tax liability (hereinafter “tax strategy”), whether known or unknown at the relevant time, shall be deemed insufficient to differentiate a claimed invention from the prior art. As a result, applicants will no longer be able to rely on the novelty or non-obviousness of a tax strategy embodied in their claims to distinguish them from the prior art. Any tax strategy will be considered indistinguishable from all other publicly available information that is relevant to a patent’s claim of originality. This provision aims to keep the ability to interpret the tax law and to implement such interpretation in the public domain, available to all taxpayers and their advisors.

The term “tax liability” is defined for purposes of this provision as referring to any liability for a tax under any federal, state, or local law, or the law of any foreign jurisdiction, including any statute, rule, regulation, or ordinance that levies, imposes, or assesses such tax liability.

There are two exclusions to this provision. The first is that the provision does not apply to that part of an invention that is a method, apparatus, technology, computer program product, or system, that is used solely for preparing a tax or information return or other tax filing, including one that records, transmits, transfers, or organizes data related to such filing.

The second is that the provision does not apply to that part of an invention that is a method, apparatus, technology, computer program product, or system, that is used solely for financial management, to the extent that it is severable from any tax strategy or does not limit the use of any tax strategy by any taxpayer or tax advisor.

This provision took effect on September 16, 2011, and applies to any patent application that is pending on, or filed on or after, September 16, 2011, and to any patent issued on or after September 16, 2011. Accordingly, this provision will apply in a reexamination or other post-grant proceeding only to patents issued on or after September 16, 2011.

II. EXAMINATION GUIDANCE FOR CLAIMS RELATING TO TAX STRATEGIES

The following procedure should be followed when examining claims relating to tax strategies.

• 1. Construe the claim in accordance with MPEP § 2111et seq.
• 2. Analyze the claim for compliance with 35 U.S.C. 101 and 112 in accordance with current guidance, which is unaffected by this provision.
• 3. Identify any limitations relating to a tax strategy, as defined above (note the listed exclusions).
  • a. Inventions that fall within the scope of AIA section 14 include those tax strategies especially suitable for use with tax-favored structures that must meet certain requirements, such as employee benefit plans, tax-exempt organizations, or other entities that must be structured or operated in a particular manner to obtain certain tax consequences.
  • b. Thus, AIA section 14 applies if the effect of an invention is to aid in satisfying the qualification requirements for a desired tax-favored entity status, to take advantage of the specific tax benefits offered in a tax-favored structure, or to allow for tax reduction, avoidance, or deferral not otherwise automatically available in such entity or structure.
• 4. Evaluate the claim in view of the prior art under 35 U.S.C. 102 and 103, treating any limitations relating to a tax strategy as being within the prior art, and not as a patentable difference between the claim and the prior art. This approach is analogous to the treatment of printed matter limitations in a claim as discussed at MPEP § 2112.01, subsection III.

Form paragraph 7.06.01 may be used to indicate claim limitation(s) interpreted as a tax strategy.

III. EXAMPLES DIRECTED TO COMPUTER-IMPLEMENTED METHODS

A computer-implemented method that is deemed novel and non-obvious would not be affected by this provision even if used for a tax purpose. For example, a novel and non-obvious computer-implemented method for manipulating data would not be affected by this provision even if the method organized data for a future tax filing. However, a prior art computer-implemented method would not become non-obvious by implementing a novel and non-obvious tax strategy. That is, the presence of limitations relating to the tax strategy would not cause a claim that is otherwise within the prior art to become novel or non-obvious over the prior art.

Thus, for purposes of applying art to a software-related invention under 35 U.S.C. 102 and 35 U.S.C. 103, claim limitations that are directed solely to enabling individuals to file their income tax returns or assisting them with managing their finances should be given patentable weight, except that claim limitations directed to a tax strategy should not be given patentable weight.