Opinion
Case No. CV 02-01996 DDP (AJWx)
June 25, 2002
ORDER GRANTING DEFENDANT'S MOTION TO DISMISS
This matter comes before the Court on the defendant's motion to dismiss. After reviewing and considering the materials submitted by the parties and hearing oral argument, the Court grants the defendant's motion to dismiss with prejudice.
Although the Court is bound by the applicable statute to grant the defendant's motion to dismiss, the Court commends Ms. Sherman on the articulate presentation of her case at oral argument.
BACKGROUND
On March 8, 2002, the plaintiff in pro se, Eva Jordan Sherman ("Sherman" or the "plaintiff"), filed the instant action against the defendant, the United States of America ("USA" or the "defendant"). The plaintiff seeks to recover from the USA internal revenue taxes for the taxable year 1992 in the amount of $5,254. (Compl.)The plaintiff alleges that the Internal Revenue Service (IRS) erroneously and illegally assessed and collected income taxes from her for 1992 in the amount of $5,254 based on her over-reporting of her pension payments from the State Teachers' Retirement System. (Compl.) On her 1992 federal income tax return, on line 17b, the plaintiff reported that she received $44,074.54 in pension payments. (Id.) The plaintiff should have only reported the amount of $27,159, which was the amount reflected as gross pension distributions reported as paid to her on an IRS Form 1099 issued to her by the State Teachers' Retirement System. (Id.) The plaintiff did not realize the error until April 2000. (Id.)
On April 2, 2000, the plaintiff submitted to the IRS an IRS form 1040X, Amended U.S. Tax Return, for 1992. (Id.) On the amended income tax return for 1992, the plaintiff asserted that she had a reduced tax liability for that year due to a mistake she made in putting the amount of $44,072.68 on line 17b of her 1992 income tax return rather than the amount of $27,159 shown on an IRS Form 1099-R for her gross pension distributions for 1992. (Id.) The plaintiff further asserted: "During the processing of my return the processor evidentially did not compare the amount $44,072.68, shown as the taxable amount of my pension on line 17b, with the amount $27,159.00, shown as my gross distribution (total pension) on my 1099R form for 2992. Accurate processing would have detected this error." (Id.) The plaintiff claims that she is entitled to a refund of tax in the amount of $5,254. (Id.)
On April 4, 2000, the IRS received the plaintiff's claim for a refund. (Id.) On April 28, 2000, the IRS disallowed the plaintiff's claim for a refund. (Id.) The plaintiff filed an administrative appeal of the disallowance of her claim for a refund. On September 21, 2000, the IRS informed the plaintiff that it could not process her claim. (Id.) On March 8, 2002, the plaintiff filed the instant case.
DISCUSSION
A. Legal Standard
1. Subject Matter Jurisdiction
"A federal court always has the power to determine its own subject matter jurisdiction (i.e. whether it may adjudicate the particular type of case involved) ." William W. Schwarzer et al., Federal Civil Procedure Before Trial § 2:21 (1999). Federal courts must determine issues of subject matter jurisdiction before considering a case on its merits. Id. at § 2:22.
B. Analysis
The defendant contends that the Court does not have subject matter jurisdiction over the instant case because the plaintiff failed to file a timely refund pursuant to 26 U.S.C. § 6511. (Def's Mtn. at 8.) The plaintiff alleges that subject matter jurisdiction is conferred over the instant action for refund of taxes pursuant to 28 U.S.C. § 1346(a)(1).
28 U.S.C. § 1346(a) provides: "The district courts shall have original jurisdiction, concurrent with the United States Court of Federal Claims, of: (1) Any civil action against the United States for the recovery of any internal-revenue tax alleged to have been erroneously or illegally assessed or collected, . . . under the internal-revenue laws . . . ." Id.
However, any tax refund suit brought pursuant to 28 U.S.C. § 1346(a)(1) is subject to the requirements of 26 U.S.C. § 7422(a), which provides:
No suit or proceeding shall be maintained in any court for the recovery of any internal revenue tax alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected without authority, or of any sum alleged to have been excessive or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with the Secretary, according to the provisions of law in that regard, and the regulations of the Secretary established in pursuance thereof.
Id. Under 26 U.S.C. § 7422(a), the government consents to be sued for a tax refund, provided that a claim for refund is duly filed with the IRS, which means the claim has to be timely under 26 U.S.C. § 6511. United States v. Dalm, 494 U.S. 596, 608 (1990); see also Crismon v. United States, 550 F.2d 1205, 1206 (9th Cir. 1977) (holding that a taxpayer is prevented from maintaining a suit in any court for a tax refund until a claim for refund has been duly filed). Thus, the issue in the instant case is whether the plaintiff's claim for refund was timely under 26 U.S.C. § 6511.
26 U.S.C. § 6511(a) provides that a claim for credit or refund of any overpayment of any tax must be filed within three years from the time the return was filed or two years from the time the tax was paid, whichever of such periods expires the later, or if no return was filed by the taxpayer, within two years from the time the tax was paid. Yuen v. United States, 825 F.2d 244, 245 (9th Cir. 1987). Section 6511(b)(1) provides that no credit or refund shall be allowed after the expiration of the period of limitations prescribed in § 6511(a), unless a claim therefore is timely filed. "Unless a taxpayer has duly filed a claim for refund of federal taxes with the IRS, a district court is without jurisdiction to entertain a suit for refund, and a claim is not duly filed unless it is timely." Yuen, 825 F.2d at 245 (citations omitted); see also, 26 U.S.C. § 6511(a) and 7422(a) (no tax refund suit may be maintained unless a claim for refund is duly filed); Dalm, 494 U.S. at 601-02.
Under § 6511(a), the plaintiff had three years from April 15, 1993, the date she filed her original 1992 income tax return, to file with the IRS an amended return to correct any mistakes and to claim a refund of any overpaid taxes. To be timely, the plaintiff must have filed her amended return by April 15, 1996. The plaintiff filed her amended return on April 4, 2000.
The Court is bound to follow § 6511(b)(1). Section 6511(b)(1) is statutory law enacted by Congress, which legally precludes the IRS and this Court from allowing any refund of plaintiff's 1992 income tax payments for 1992 because her refund claim was not timely. Because the plaintiff's claim for refund was not timely, the Court is without jurisdiction to adjudicate the instant action.
CONCLUSION
Based on the foregoing, the Court grants the defendant's motion to dismiss with prejudice.
IT IS SO ORDERED.