Opinion
Case No. 03-23147-CIV-MORENO.
May 27, 2004
ORDER GRANTING DEFENDANTS' MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION
Before the Court is an action brought by Plaintiff David N. Peterson for the violation of his statutory and constitutional due process rights arising from the denial of a fair collection due process hearing. Plaintiff seeks a declaratory judgment that Defendants Chester Kreidich and Edward Blum, violated his statutory and constitutional due process rights to a fair hearing as well as an order compelling the Defendants to provide such a fair hearing. Defendants urge the Court to dismiss the action for lack of subject matter jurisdiction. For the reasons set forth below, the Court GRANTS Defendants' motion.
I. BACKGROUND
The present action involves the collection of income taxes from Plaintiff for the tax years 1993, 1994, and 1995. The IRS has made assessments for these three income tax years in the amount of over $40,000. Complaint, Exhibit A. After making assessments, the IRS instituted collection actions against Plaintiff. On December 24, 2002, the IRS sent Plaintiff a notice of intent to levy for Plaintiff's tax liability for the year 1993. Following, on February 27, 2003, the IRS sent Plaintiff a second notice of intent to levy for Plaintiff's tax liability for the years 1994 and 1995. On March 27, 2003, Plaintiff requested a collection due process hearing to challenge the notice of intent to levy for the years 1994 and 1995. Accordingly, the Office of Appeals scheduled a collection due process hearing for September 18, 2003. At the hearing, Plaintiff appeared but refused to proceed because the IRS refused to allow him to record the hearing. Kreidich Declaration at ¶ 6; Peterson Affidavit, Exhibit G to Complaint. Subsequently, on October 31, 2003 the Office of Appeals issued a Notice of Determination for the tax years 1994 and 1995, sustaining the proposed collection action.
Plaintiff failed to request a collection due process hearing for the tax year 1993. As a result, on October 23, 2003, an equivalency hearing considered the matter and the Office of Appeals issued a Decision Letter sustaining the collection process proposed by the IRS. Kreidich Declaration at ¶ 7.
Shortly thereafter, on November 26, 2003, Plaintiff filed his complaint against Defendants Kreidich and Blum. Kreidich is an Appeals Team Manager for the IRS and Blum is an IRS Appeals Officer. Kreidich Declaration at ¶¶ 1-2.
II. ANALYSIS
Defendants urge the Court to dismiss Plaintiff's complaint for the following reasons: (1) the Court has no jurisdiction to hear an appeal that is properly before the United States Tax Court; (2) Plaintiff's claims for declaratory relief are barred by the Declaratory Judgment Act; and (3) the United States, not Kreidich and Blum, is the proper party Defendant. In response, Plaintiff contends that suit against Kreidich and Blum is proper under the Federal Tort Claims Act and that his claim for declaratory judgment is not barred by the Declaratory Judgment Act.
A. Appealability of IRS Office of Appeals Decisions
With respect to the tax year 1993, Plaintiff failed to request a collection due process hearing. Where as here, the taxpayer fails to timely request a collection due process hearing, the taxpayer may appear at the equivalency hearing. Treas. Reg. § 301.6330-1(I)(1). However, the taxpayer is not entitled to appeal the resulting decision. Treas. Reg. § 301.6330-1(I)(2), Q-15, A-15.
With respect to the tax years 1994 and 1995, Plaintiff may appeal his Notice of Determination from the IRS Office of Appeals within thirty (30) days of the notice. IRC § 6330(d); Treas. Reg. § 301.6330 1(f). If the tax is of a type over which the United States Tax Court has jurisdiction, the taxpayer must direct his appeal to the Tax Court. IRC § 6330(d)(1); Treas. Reg. § 301.6330-1(f)(2), Q-F3, A-F3. Moreover, where the taxpayer improperly files an appeal that is properly before the Tax Court in the district court, the district court must dismiss the appeal for lack of subject matter jurisdiction. See Diefenbaugh v. Weiss, 2000 WL 1679510 *2 (6th Cir. 2000); True v. Commissioner, F. Supp.2d 1361, 1364 (M.D. Fla. 2000); Helvie v. Beach, 2003 WL 22073142 *3 (S.D. Fla. 2003) (Hurley, J.).
As a result, Plaintiff may not seek judicial review of the IRS Office of Appeals decisions. The Office of Appeals decision at the equivalency hearing is not appealable and its decision following the collection due process hearing is only appealable to the Tax Court, as the tax at issue is a type over which the Tax Court has jurisdiction.
B. Declaratory Judgment and Injunction
The relief sought by Plaintiff of a declaratory judgment and injunction are not available in actions such as these. First the Declaratory Judgment Act § 2201(a) specifically bars declaratory relief with respect to federal taxes. In addition, the Anti-Injunction Act specifically bars injunctive relief "for the purpose of restraining the assessment or collection of any tax". 26 U.S.C. § 7421(a).
C. Suits Against Officials of the United States
Suits against an officer or agent of the United States for actions taken in his official capacity are properly held against the United States, not the individual official. See Dugan v. Rank, 372 U.S. 609 (1962); Atkinson v. O'Neill, 867 F.2d 589, 590 (10th Cir. 1989).
Plaintiff claims that Kreidich and Blum are the appropriate parties because the Federal Tort Claims Act ("FTCA") allows suits against officers of the United States for tortious conduct. However, the FTCA does not allow suits for equitable relief. See Morelli v. United States, 1993 WL 313094 *1 (S.D.N.Y. 1993). More specifically, the FTCA precludes suit under the act for all claims arising with respect to the assessment or collection of a tax. 28 U.S.C. § 2680(c). Moreover, courts have routinely dismissed constitutional claims brought under the FTCA and based upon allegations of misconduct during collection due process hearings. See Fingado v. Mares, 2003 WL 22384757 *3 (D.N.M. 2003); Tornichio v. United States, 263 F. Supp.2d 1090, 1099 (N.D. Ohio 2002).
III. CONCLUSION
Because this Court is not the proper court for such an appeal, the declaratory and injunctive relief Plaintiff seeks is barred, and suit against Defendants Kreirich and Blum is properly against the United States, this Court is left with no conclusion but to DISMISS Plaintiff's claim for lack of subject matter jurisdiction. Accordingly, it is
ADJUDGED that Defendants Motion to Dismiss (D.E. No. 5), filed on March 23, 2004 is GRANTED. As a result, it is ADJUDGED that Plaintiff's complaint is DISMISSED for lack of subject matter jurisdiction. Finally, it is
ADJUDGED that all pending motions in this action are DENIED as moot.
DONE AND ORDERED.