Court Determines Individual Hasn't Paid Full Tax Liability

Pending before the Court is Defendant's motion to dismiss, (Doc. No. 12), in which it moves for dismissal of Plaintiff's refund claim on the ground that this Court lacks subject matter jurisdiction. Defendant also moves for dismissal of Plaintiff's wrongful disclosure claim for failure to state a claim for which relief can be granted. Plaintiff opposes the motion to dismiss, arguing primarily that she has already paid the full amount of any and all IRS assessments. After reviewing the parties' briefing and the transcript of the June 26, 2015, hearing, Defendant's motion to dismiss, (Doc. No. 12), will be GRANTED, and the above-captioned matter will be DISMISSED.

When a party challenges a federal court's subject matter jurisdiction, "the plaintiff [has] the burden of proof that jurisdiction does in fact exist." Mortenson v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir. 1977). In lawsuits against the United States, the Court begins with the presumption that "[t]he United States, as sovereign, is immune from suit save as it consents to be sued . . ., and the terms of its consent to be sued in any court define that court's jurisdiction to entertain the suit." U.S. v. Mitchell, 445 U.S. 535, 538 (1980) (internal quotations and citation omitted). "A waiver of sovereign immunity cannot be implied but must be unequivocally expressed," Id. (internal quotations and citation omitted), and such a waiver must be "narrowly construed." U.S. v. Nordic Vill. Inc., 503 U.S. 30, 34 (1992).

Plaintiff brings her refund claim pursuant to 28 U.S.C. § 1346, which provides:

Here, the IRS continues to engage in collection activities against Ms. Komlo. Plaintiff argues that she has already paid -- via the IRS's receipt of the sale proceeds of her Florida property -- the amount of taxes she owed for the tax years in question. However, it is apparent from the complaint and Plaintiff's representations to the Court that the assessments against Ms. Komlo have yet to be paid in full, notwithstanding the Tax Court's Order setting the amount of taxes owed by Plaintiff for the 1998 tax year. Put simply, Plaintiff challenges the accuracy of the assessment, but an assessment for the years 1998, 2008 and 2010 nonetheless remains outstanding. It is the amount assessed as unpaid, not the amounted claimed by the litigant to be the correct assessment, that is pertinent for determining whether there is full payment for purposes of 28 U.S.C. § 1346(a)(1). As such, the Court lacks jurisdiction to hear Plaintiff's refund claim.

B. Plaintiff Has Failed to State a Claim for Wrongful Disclosure

In count III, Plaintiff avers that the IRS improperly disclosed Ms. Komlo's tax return information to Plaintiff's employer in violation of 26 U.S.C. § 6103.⁴ That statute provides:

Section 6103 enumerates a list of exceptions to the rule of confidentiality. The relevant section for purposes of this case is § 6103(k)(6), which provides:

The Treasury Regulations, in turn, provide:

Here, Plaintiff alleges that the government violated § 6103 by disclosing to Dr. Mark Solomon, Plaintiff's employer, that Plaintiff was delinquent in her taxes. The complaint is clear that the disclosure was made in the process of levying against Plaintiff's wages in her employment with Dr. Solomon. Therefore, the disclosure was made "in connection with [IRS] official duties relating to . . . collection activity" pursuant to 26 U.S.C. § 6103(k)(6) and, more specifically, "to [the] establishment of . . . [a] levy . . . to satisfy any such liability" under Treasury Regulation § 301.6103(k)(6)-1(a)(vi).

Plaintiff nonetheless argues once again that her taxes are fully paid. It follows logically, she argues, that Treasury Regulation § 301.6103(k)(6)-1(a)(vi) does not apply because there cannot be a levy when there is no tax assessment. In response, the Government directs the Court's attention to Venen v. U.S., 38 F.3d 100 (3d Cir. 1994). In that case, the Third Circuit stated, "[w]e join those cases that decline to consider the validity of the underlying levy in deciding whether the IRS has disclosed in violation of section 6103." 38 F.3d at 105. In so finding, the court explained:

In sum, it is irrelevant whether the assessment and resulting levy is improper. The fact of the matter is that the Complaint demonstrates that the disclosure to Ms. Komlo's employer was made in the process of levying against Plaintiff's wages. Therefore, Plaintiff has failed to state a claim for which relief can be granted.

² The total as represented to the Court by the Government as of the date of the hearing on Plaintiffs Motion for Temporary Restraining Order and Preliminary Injunction

³ The correct forum to contest an unpaid assessment is the United States Tax Court. DiNatale v. U.S., 12 Cl. Ct. 72, 74 (1987).

⁴ 26 U.S.C. § 7431 creates a private right of action for violations of § 6103: