In Farley v. United States, the Supreme Court examined whether a federal court had jurisdiction over an appeal from a decision of the Tax Court involving income tax deficiencies. The petitioner, Farley, was assessed with additional taxes and penalties by the Commissioner of Internal Revenue for allegedly understating his income on his 1943-1945 tax returns. He contested these assessments in Tax Court but lost; he then appealed to the Sixth Circuit which dismissed his case for lack of jurisdiction. The Supreme Court held that under Section 1141(a) of the Internal Revenue Code (IRC), decisions made by the Tax Court could be reviewed only by courts specified in IRC Section 7482 - namely U.S Courts of Appeals or state supreme courts if they were "courts of record". Since this did not include district courts, it meant that appeals from decisions made by IRS Commissioners should go directly to one such designated appellate court rather than first being heard at district level. Therefore, while acknowledging that its interpretation might seem harsh given potential implications for taxpayers seeking redress against unjustified tax assessments, it upheld dismissal as correct because Congress had clearly intended to streamline litigation processes related to taxation disputes and avoid unnecessary delays caused through intermediate hearings at lower levels.

The dissenting opinion in the case of Farley v. United States argued that the majority's decision to uphold Farley's conviction was a departure from established legal principles regarding entrapment. The dissent contended that, based on evidence presented at trial, it was clear that government agents had induced Farley into committing the crime for which he was convicted - selling narcotics without a written order form. They believed this constituted entrapment and should have resulted in his acquittal. Furthermore, they disagreed with the majority’s interpretation of Sorrells v U.S., arguing instead that if there is any dispute over whether or not a defendant has been entrapped, it should be resolved by the jury rather than being decided as a matter of law by judges.