Tax Clinic Argues Whistleblower’s Tax Court Petition Was Timely

DAVID T. MYERS,
Petitioner-Appellant,
v.
COMMISSIONER OF INTERNAL REVENUE, 
Respondent-Appellee.

ORAL ARGUMENT NOT YET SCHEDULED

IN THE UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

On Appeal from the United States Tax Court

AMICUS BRIEF OF THE FEDERAL TAX CLINIC OF THE LEGAL
SERVICES CENTER OF HARVARD LAW SCHOOL IN SUPPORT OF
THE APPELLANT

Carlton M. Smith, Esq.
Counsel for Amicus
255 W. 23rd Street, Apt. 4AW
New York, New York 10011
(646) 230-1776
carltonsmth@aol.com

CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES

Pursuant to D.C. Circuit Rules 28(a)(1) and 29, the undersigned counsel certify as follows:

(A) Parties and Amici

All parties, intervenors, and amici appearing before the United States Tax Court and in this Court are listed in the Brief for Appellant.

(B) Rulings Under Review

References to the rulings at issue appear in the Brief for Appellant.

(C) Related Cases

There are no related cases under D.C. Circuit Rule 28(a)(1)(C).

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 TABLE OF CONTENTS

CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES

TABLE OF CONTENTS

TABLE OF AUTHORITIES

GLOSSARY OF ABBREVIATIONS

INTEREST OF THE AMICUS

STATUTES AND REGULATIONS

ARGUMENT

CONCLUSION

CERTIFICATE OF COMPLIANCE WITH TYPE-VOLUME LIMITATION, TYPEFACE REQUIREMENTS, AND TYPE STYLE REQUIREMENTS

CERTIFICATE OF SERVICE

TABLE OF AUTHORITIES

Cases

Arbaugh v. Y & H Corp., 546 U.S.500 (2006)

Bowles v. Russell, 551 U.S. 205 (2007)

Cunningham v. Commissioner, 716 Fed. Appx. 182 (4^th Cir. 2018)

Dees v. Commissioner, 148 T.C. No. 1 (Feb. 2, 2017)

Detroit Trust Co. v. United States, 131 Ct. Cl. 223 (1955)

Duggan v. Commissioner, 879 F.3d 1029 (9^th Cir. 2018)

Friedland v. Commissioner, T.C. Memo. 2011-90

*Gonzalez v. Thaler, 565 U.S. 134 (2012)

Guralnik v. Commissioner, 146 T.C. 230 (2016)

*Henderson v. Shinseki, 562 U.S. 428 (2011)

Hamer v. Neighborhood Housing Servs., 138 S. Ct.13 (2017)

John R. Sand & Gravel Co. v. United States, 552 U.S. 130 (2008)

Keohane v. United States, 669 F.3d 325 (D.C. Cir. 2012)

*Kontrick v. Ryan, 540 U.S. 443 (2004)

Lippolis v. Commissiooner, 143 T.C. 393 (2014)

Magnum v. Action Collection Services, Inc.,575. F. 3d 935 (9^th Cir. 2009)

Matuszak v. Commissioner, 862 F.3d 192 (2^nd Cir. 2017)

Moyer v. Commissioner, T.C. Memo. 2016-236

*Musacchio v. United States, 136 S. Ct. 709 (2016)

Perales v. Commissioner, 2016 U.S. App. LEXIS 16597 (D.C. Cir. 2016)

Perales v. Commissioner, T.C. Memo. 2017-90

*Reed Elsevier, Inc. v. Muchnick, 559 U.S. 154 (2010)

Rubel v. Commissioner, 856 F.3d 301 (3d Cir. 2017)

*Sebelius v. Auburn Regional Medical Center, 568 U.S. 145 (2013)

Tilden v. Commissioner, 846 F.3d 882 (7^th Cir. 2017)

Tucker v. Commissioner, 676 F.3d 1129 (D.C. Cir. 2012)

Union Pac. R.R. v. Bhd. of Locomotive Eng'rs & Trainmen Gen. Comm. of Adjustment, 558 U.S. 67 (2009)

*United States v. Wong, 135 S. Ct. 1625 (2015)

V.L. v. E.L., 136 S. Ct. 1017 (2016)

Volpicelli v. United States, 777 F.3d 1042 (9^th Cir. 2015)

Statutes

15. U.S.C.:

§ 1692k

§ 1692k(d)

26 U.S.C. (I.R.C.):

§ 6015(e)(1)(A)

§ 6015(e)(1)(B)(ii)

§ 6213(a)

§ 6214(a)

§ 6230

§ 6330

§ 6330(d)(1)

§ 6532(a)

§ 6532(c)

§ 7433(d)(3)

§ 7482(b)(1)

§ 7623(a)

§ 7623(b)

§ 7623(b)(4)

§ 7623(b)(5)

28. U.S.C.:

§ 2253

§ 2253(c)(3)

§ 2501

42. U.S.C.:

§ 1395oo(a)

§ 1395oo(a)(3)

Revenue Act of 1924, ch. 234:

§ 274(a)

§ 308(a)

Revenue Act of 1926, ch. 27:

§ 274(e)

§ 308(e)

Pub. L. 100-647, § 6243(a)

Pub. L. 105-206, § 3401(b)

Pub. L. 106-554, § 313(d)

Pub. L. 109-280, § 855(a)

Pub. L. 109-432, Division A, § 406

Pub. L. 114-113, Div. Q, § 424(a)

Other Authorities

Bryan Camp, “Guralnik — Equity Through Court Rules Not Court Rulings”, www.procedurallytaxing.com (June 6, 2016)

FRAP 29(a)(4)(E)

H.R. (Conf.) Rept. 106-1033

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Authorities upon which we chiefly rely are marked with asterisks.

GLOSSARY OF ABBREVIATIONS

CDP	Collection Due Process, the statutory review procedures, found at 26 U.S.C. §§ 6230 and 6330, following issuance by the IRS of either notices of filing of a tax lien or notices of intention to levy

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INTEREST OF THE AMICUS¹

The Federal Tax Clinic of the Legal Services Center of Harvard Law School (“the Clinic”) was formed in 2015 to represent low-income taxpayers before the Internal Revenue Service and in tax matters before the courts. While the Clinic has never had a whistleblower award client, in a series of recent cases, the Clinic has argued that the deadlines in §§ 6015(e)(1)(A) and 6330(d)(1)² for filing Tax Court innocent spouse and Collection Due Process (“CDP”) petitions, respectively, are not jurisdictional and are subject to equitable tolling under recent Supreme Court case law that has narrowed the use of the word “jurisdictional” generally to exclude filing deadlines. In the innocent spouse cases of Rubel v. Commissioner, 856 F.3d 301 (3d Cir. 2017), and Matuszak v. Commissioner, 862 F.3d 192 (2d Cir. 2017), the courts held the filing deadlines to be jurisdictional. In Duggan v.Commissioner, 879 F.3d 1029 (9^th Cir. 2018), where the Clinic was an amicus, it was held that the CDP filing deadline is jurisdictional. Days later, in Cunningham v. Commissioner, 716 Fed. Appx. 182 (4^th Cir. 2018), the Fourth Circuit declined to opine on whether the CDP filing period is jurisdictional or subject to equitable tolling — finding that the facts presented would not justify equitable tolling, in any event.

The Clinic is continuing to litigate the issue of the jurisdictional nature of the innocent spouse filing deadline in § 6015(e)(1)(A) in Nauflett v. Commissioner, Fourth Circuit Docket No. 17-1986. The Fourth Circuit held oral argument in Nauflett on May 9.

As an amicus, the Clinic has also filed a brief in Pfizer v. United States, Second Circuit Docket No. 17-2307, arguing that the deadline in § 6532(a) in which to bring a district court tax refund suit is not jurisdictional under current Supreme Court case law. The Second Circuit held oral argument in Pfizer on February 13.

As an amicus, the Clinic has also filed briefs in Organic Cannabis Foundation v. Commissioner, Ninth Circuit Docket No. 17-72874, and Northern California Small Business Assistants, Inc. v. Commissioner, Ninth Circuit Docket No.17-72877, arguing that the deadline in § 6213(a) in which to file Tax Court deficiency petitions is not jurisdictional and is subject to equitable tolling under current Supreme Court case law. Briefing in these two cases is ongoing.

As an amicus in Volpicelli v. United States, 777 F.3d 1042 (9^th Cir. 2015), Carlton Smith (pro bono counsel to the Clinic, who was, in 2013, the Director of the tax clinic at Cardozo School of Law), helped persuade the Ninth Circuit to hold that the filing deadline in § 6532(c) in which to bring a district court wrongful levy suit is not jurisdictional and is subject to equitable tolling.

The Clinic's purpose in filing this brief is to request that this Court hold that the deadline in § 7623(b)(4) (which is derived from the CDP petition filing period language) is not jurisdictional. Such a nonjurisdictional ruling may be of aid, by analogy, to low-income taxpayers in CDP cases because, in that event, any noncompliance with the filing deadline would become an affirmative defense that the government could waive or would forfeit (if the government did not raise the argument early enough in the litigation). Other CDP taxpayers who, for equitable reasons, missed the filing deadline might also benefit.

STATUTES AND REGULATIONS

All applicable statutes and regulations appear in the Addendum of the Brief for Appellant.

ARGUMENT

In the instant case, the Tax Court granted an IRS motion to dismiss the petition for lack of jurisdiction as untimely under § 7623(b)(4). However, untimely filing does not deprive the Tax Court of jurisdiction of a whistleblower award review matter. Accordingly, the dismissal for lack of jurisdiction was improper and any dismissal for late filing should have been, if at all, for failure to state a claim on which relief could be granted.

Section 7623(a) has long authorized the IRS to issue discretionary whistleblower awards. In 2006, Congress enacted § 7623(b), which provides for mandatory whistleblower awards within a certain range and in limited circumstances. Section 7623(b)(4) was enacted as part thereof, providing for Tax Court review over the sufficiency of any mandatory whistleblower award or lack thereof. Section 7623(b)(4) contains both a jurisdictional grant to the Tax Court and a 30-day filing deadline. A number of whistleblowers have filed late Tax Court petitions, and the Tax Court has held, as it did in this case, that the failure to file on time is a jurisdictional defect of such a suit. See, e.g., Friedland v. Commissioner, T.C. Memo. 2011-90. However, no Tax Court opinion concerning § 7623(b)(4) has ever considered how the Supreme Court's case law starting with Kontrick v.Ryan, 540 U.S. 433 (2004) — which has generally excluded filing deadlines from jurisdictional effect — applies to the whistleblower petition filing deadline.

This Court is the sole proper appellate venue for whistleblower award suits commend in the Tax Court. § 7482(b)(1) (flush language). This Court has not yet ruled on whether the filing deadline in § 7623(b)(4) is jurisdictional. The closest this Court came to ruling on this issue is in an appeal from an unpublished order in Perales v. Commissioner, Tax Court Docket No. 28044-14W (order dated July 16, 2015).³ Mr. Perales repeatedly sent claims to the IRS, and the IRS, on 34 occasions, wrote back letters denying those claims. After Mr. Perales filed a Tax Court petition, the IRS moved to dismiss the suit for lack of jurisdiction as untimely. In the order, the Tax Court granted the IRS' motion as to the first 17 IRS letters, but not as to the remaining 17 IRS letters. Mr. Perales then appealed the order to this Court, which, in an unpublished, nonprecedential opinion, affirmed the Tax Court stating:

ORDERED AND ADJUDGED that the Tax Court's order filed July 16, 2015 be affirmed. The Tax Court held that appellant's petition was untimely with respect to the denials of seventeen whistleblower claims, see 26 U.S.C. § 7623(b)(4), and appellant does not challenge this ruling. He therefore has forfeited any issue regarding the timeliness of his petition . See U.S. ex rel. Totten v. Bombardier Corp., 380 F.3d 488, 497 (D.C. Cir. 2004).

Perales v. Commissioner, 2016 U.S. App. LEXIS 16597 (D.C. Cir. 2016). (The Tax Court later granted summary judgment to the IRS with respect to the remaining letters. Perales v. Commissioner, T.C. Memo. 2017-90.) Since timeliness was not even argued by Mr. Perales, this is hardly persuasive authority for this Court. Further, if anything, the Court's noting that the taxpayer made no argument on the point suggests that the Court viewed the time period as not jurisdictional, since courts have an independent duty to enforce jurisdictional limits — a duty the parties cannot affect by failing to argue jurisdictional issues.

I. Section 7623(b)(4)'s Filing Deadline is Not Jurisdictional Under Current Supreme Court Case Law.

Beginning in 2004, the Supreme Court observed that it and other courts had been too careless in using the word “jurisdictional”. The Court held that, henceforth, claims processing rules (which include filing deadlines) should usually not be considered jurisdictional. Rather, the word “jurisdictional” should be reserved only for subject matter and personal jurisdiction. Kontrick v. Ryan, 540 U.S. 443, 455 (2004).

Since Kontrick, the Supreme Court has held that filing deadlines are almost never jurisdictional. United States v. Wong, 135 S. Ct. 1625 (2015). However, the Court acknowledges that filing deadlines still can be jurisdictional if Congress makes a “clear statement” to that effect. Id. at 1632. The Court has stated:

[I]n applying that clear statement rule, we have made plain that most time bars are nonjurisdictional. See, e.g., [Sebelius v. Auburn RegionalMed. Cntr., 568 U.S.] at 154 (noting the rarity of jurisdictional time limits). Time and again, we have described filing deadlines as “quintessential claim-processing rules,” which “seek to promote the orderly progress of litigation,” but do not deprive a court of authority to hear a case. Henderson v. Shinseki, 562 U.S. 428, 435 (2011); see Auburn Regional. 568 U.S., at 154; Scarborough v. Principi, 541 U.S. 401, 413 (2004). That is so, contrary to the dissent's suggestion, see post, at ___, ___ - ___, 191 L. Ed. 2d, at 551, 554-555, even when the time limit is important (most are) and even when it is framed in mandatory terms (again, most are); indeed, that is so “however emphatic[ally]” expressed those terms may be. Henderson, 562 U.S., at 439 (quoting Union Pacific R. Co. v. Locomotive Engineers, 558 U.S. 67, 81 (2009)). Congress must do something special, beyond setting an exception-free deadline, to tag a statute of limitations as jurisdictional and so prohibit a court from tolling it.

Id.

In Wong, the Court also wrote:

Id. at 1633.

Three Supreme Court opinions issued after Kontrick have held a statutory filing deadline nonjurisdictional because (1) there was no clear statement otherwise from Congress within the statute and (2) an actual jurisdictional grant was located far away from the stated time period in the United States Code. Musacchio v. United States, 136 S. Ct. 709 (2016); Wong, supra; Henderson v. Shinseki, 562 U.S. 428 (2011) (holding the period to file in the Article I Court of Appeals for Veterans Claims nonjurisdictional).⁴ But, the Supreme Court has also held a filing deadline not jurisdictional, even where the jurisdictional grant was in the same sentence as the deadline. Sebelius v. Auburn Regional Med. Cntr., 568 U.S. 145 (2013).

The Court has never yet held, following Kontrick, that statutory words clearly stated Congress' intent that a filing deadline be jurisdictional. This makes it especially difficult for lower courts to hold time periods jurisdictional under the clear statement rule, since there are no examples provided by the Supreme Court to consider at this time.

Compliance with the 30-day period in § 7623(b)(4) is most certainly not a jurisdictional predicate for a suit under the clear statement exception.

Section 7623(b)(4) states: “Any determination regarding an award under paragraph (1), (2), or (3) may, within 30 days of such determination, be appealed to the Tax Court (and the Tax Court shall have jurisdiction with respect to such matter).”

The opinion most pertinent to interpreting § 7623(b)(4) is Sebelius v. Auburn Regional Med. Cntr., supra, which involved the 180-day deadline under 42 U.S.C. § 1395oo(a)(3) for Medicare providers to bring reimbursement disputes before an administrative board. In a single, long sentence, subsection (a) of that statute stated that those providers “may” obtain hearings before such boards if (1) the providers were dissatisfied with certain reimbursement determinations, (2) the amount in controversy was $10,000 or more, and (3) the providers requested a hearing within 180 days after the determination (or waited 180 days from the time a determination should have been issued).

The Supreme Court appointed an amicus to argue that the 180-day period was jurisdictional. However, the Court then rejected that argument, writing:

Last Term, we rejected a similar proximity-based argument.

Auburn, 568 U.S. at 156.

The Court noted that subsection (a)(3) did not contain words similar to “shall file a notice of appeal” — words insufficient even in Henderson to make the time period jurisdictional — but rather contained the much milder words “may obtain a hearing” before the Board if “such provider files a request for a hearing within 180 days after notice of the intermediary's final determination.” Id. at 154-155. The Court found this did not overcome the usual rule that filing deadlines are not jurisdictional.

As the Court noted, the proximity-based argument made by the amicus in Auburn was previously made the year before — in Gonzalez v. Thaler, 565 U.S. 134 (2012). In that case, 28 U.S.C. § 2253 addressed the jurisdiction of district courts in habeas review. Section (c)(3) of that statute provided that “[t]he certificate of appealability under paragraph (1) shall indicate which specific issue or issues satisfy the showing required by paragraph (2).” As in Auburn, the Court in Gonzalez refused to consider the requirement of paragraph (c)(3) jurisdictional, even though it was adjacent to several jurisdiction-related provisions within the same section of the United States Code. The Court reasoned that, “Mere proximity will not turn a rule that speaks in nonjurisdictional terms into a jurisdictional hurdle.” Id. at 147.

Even before Gonzalez and Auburn, the Ninth Circuit in Magnum v. Action Collection Services, Inc., 575 F.3d 935 (9th Cir. 2009), held a time period nonjurisdictional, even though it was adjacent to a jurisdictional grant in the same sentence. 15 U.S.C. § 1692k authorizes a suit for monetary damages under the Fair Debt Collection Practices Act. Subsection (d) thereof provides: “Jurisdiction: An action to enforce any liability created by this subchapter may be brought in any appropriate United States district court without regard to the amount in controversy, or in any other court of competent jurisdiction, within one year from the date on which the violation occurs.” The Ninth Circuit stated:

[W]e attach no particular significance to the fact that this statute of limitations appears in the same sentence in which the jurisdiction provision appears. Nothing in the structure of that sentence tells us that the time limitation was also a jurisdictional limitation. In fact, a more natural reading is that parties may bring their action in any “court of competent jurisdiction” and may do so “within one year.” 15 U.S.C. § 1692k(d). It is fair to say that parties are faced with a “when” issue and a “what court” issue for every action, but the former does not usually control or affect the latter.

Id. at 940.

Similarly to in Auburn and Magnum, § 7623(b)(4) is a single sentence containing a jurisdictional grant and a time period. But, there is no clear statement that the time period is similarly intended to be jurisdictional. Instead, there is confusion. While it is arguable that “such matter” in the jurisdictional parenthetical refers to (1) the filing of an appeal and (2) rigid compliance with the 30-day requirement, that is only one possible interpretation, not a clear statement. The jurisdictional nature of the filing deadline would be more likely if the jurisdictional grant was expressly contingent on compliance with the filing deadline, such as: “Any determination regarding an award under paragraph (1), (2), or (3) may, within 30 days of such determination, be appealed to the Tax Court (and the Tax Court shall have jurisdiction with respect to such matter only if the appeal is brought within such period)”.⁵ Indeed,the word “matter” in the parenthetical most likely refers to “subject matter”, which, under recent Supreme Court case law in effect when the statute was adopted, did not include claims processing rules like filing deadlines.

The “clear statement” exception was first articulated in in Arbaugh v. Y & H Corp., 546 U.S. 500, 515-516 (Feb. 22, 2006) (involving a claims processing rule other than a filing deadline). Section 7623(b)(4) was enacted on December 20, 2006, by Division A, § 406, Pub. L. 109-432. So, when Congress drafted § 7623(b)(4), it should be presumed that Congress knew that the filing deadline would be interpreted as nonjurisdictional unless Congress made a clear statement otherwise. This distinguishes § 7623(b)(4) from earlier-enacted Tax Court filing deadlines, such as in its deficiency (§ 6213(a)), innocent spouse (§ 6015(e)(1)(A)), and CDP (§ 6330(d)(1)) jurisdictions.

Since Kontrick, there have been only two Supreme Court opinions holding that a filing period is jurisdictional. However, those holdings were predicated not on the clear statement exception, but only on stare decisis, since for over 100 years, the Supreme Court had held those time periods jurisdictional. John R. Sand & Gravel Co. v. United States, 552 U.S. 130 (2008); Bowles v. Russell, 551 U.S. 205 (2007).

The Supreme Court has never ruled one way or the other on whether any Tax Court filing deadline is jurisdictional. Accordingly, this staredecisis exception cannot apply here.

The Clinic observes that the stare decisis exception does not apply to give deference to opinions of courts below the Supreme Court. ReedElsevier, Inc. v. Muchnick, 559 U.S. 154, 173-174 (2010) (Ginsburg, J, concurring, joined by Stevens and Breyer, JJ.) (“[I]n Bowles and John R.Sand & Gravel Co. . . . we relied on longstanding decisions of this Court typing the relevant prescriptions 'jurisdictional.' Amicus cites well over 200 opinions that characterize § 411(a) as jurisdictional, but not one is from this Court. . . .”; emphasis in original; citations omitted).

The Clinic represented the taxpayer in Matuszak v. Commissioner, 862 F.3d 192 (2d Cir. 2017) (a case involving § 6015(e)(1)(A)). When the Clinic made this identical observation and also cited to Justice Ginsburg's concurrence in Reed Elsevier for support, in its answering brief, the government wrote (p. 27 n.10) that the taxpayer was “incorrect, because the unanimous Supreme Court, in an opinion by Justice Ginsburg, has stated that extensive “'precedent and practice in American courts'” generally can render a statutory requirement jurisdictional. Auburn Reg'l, 133 S. Ct. at 825 (quoting Bowles, 551 U.S. at 209 n.2).” In response, the Clinic wrote that the government's quote indirectly from Bowles was taken out of context, since the precedent and practice in American courts referred to in Bowles there included a number of prior Supreme Court opinions stretching over about 100 years. In the following six Supreme Court opinions, the stare decisis exception was clearly articulated only to apply to a long line of Supreme Court opinions: Hamer v. Neighborhood Housing Servs., 138 S. Ct. 13, 20 n.9 (2017); Wong, 135 S. Ct. at 1636; Gonzalez v. Thaler, 565 U.S. at 142 n.3; Henderson v. Shinseki, 562 U.S. at 436; Reed Elsevier, 559 U.S. at 168;Union Pac. R.R. v. Bhd. ofLocomotive Eng'rs & Trainmen Gen.Comm. of Adjustment, 558 U.S. 67, 82 (2009).

Judge Ashford's opinion in this case (at pp. 9-10) only cites other Tax Court opinions for the holding that the whistleblower filing period is jurisdictional. However, those opinions simply rely on prior Tax Court opinions in deficiency and CDP cases that did not consider Kontrick and its progeny. This lack of consideration of recent Supreme Court opinions is particularly odd, since in Lippolis v. Commissioner, 143 T.C. 393 (2014), the Tax Court, citing Gonzalez and other post-Kontrick opinions, held that the mere fact that the $2 million amount in dispute condition of whistleblower awards set out in § 7623(b)(5) is adjacent to the jurisdictional grant in § 7623(b)(4) does not turn the amount in dispute condition into a Tax Court jurisdictional condition; rather, the $2 million condition is an affirmative defense.

In sum, neither under the clear statement exception nor the staredecisis exception is the filing deadline in § 7623(b)(4) jurisdictional.

II. Case Law Regarding Other Tax Court Filing Deadlines Does Not Require that § 7623(b)(4)'s Filing Period Also Be Treated as Jurisdictional.

The Supreme Court rules of what conditions are jurisdictional apply to the Tax Code. This Court and other courts of appeal have recently held certain Tax Code filing deadlines nonjurisdictional:

In Keohane v. United States, 669 F.3d 325, 330 (D.C. Cir. 2012), this Court, citing Henderson and other recent Supreme Court opinions, held that the 2-year deadline in § 7433(d)(3) in which to bring a district court action for damages from wrongful IRS collection actions is nonjurisdictional. Notably, this Court decided this issue, even though it made no difference in the case. This Court clearly did not want anyone to cite its affirmance of the district court's dismissal as evidence that this Court considered the deadline jurisdictional. For similar reasons, even if it affirms the Tax Court on any ground, this Court should decide the jurisdictional issue in this case, as well.

In Volpicelli v. United States, 777 F.3d 1042 (9^th Cir. 2015), the Ninth Circuit held that the 9-month deadline in § 6532(c) to bring a district court wrongful levy action is not jurisdictional and is subject to equitable tolling under current Supreme Court case law.

Four recent opinions of courts of appeals that have held deadlines to file certain Tax Court petitions jurisdictional under the recent Supreme Court case law are worth discussing because, to the extent they are not wrong (as the Clinic believes they are), the statutes they construe are, in critical respects, different from the statute at issue in this case. Below, the Clinic describes the four opinions.

A. Collection Due Process Jurisdiction

The pattern provision from which § 7623(b)(4)'s language was derived is § 6330(d)(1), which was enacted in 1998 to allow the Tax Court and district courts to review determinations issued after newly-created IRS Office of Appeals Collection Due Process (“CDP”) hearings. See Tucker v.Commissioner, 676 F.3d 1129 (D.C. Cir. 2012).

As originally enacted by § 3401(b) of Pub. L. 105-206, § 6330(d)(1) provided, as relevant to the Tax Court:

In 2000, Congress amended § 6330(d)(1) to replace the parenthetical “(and the Tax Court shall have jurisdiction to hear such matter)” with the broader parenthetical “(and the Tax Court shall have jurisdiction with respect to such matter)”. Pub. L. 106-554, § 313(d). In the Conference Report on the legislation, this change to the wording is explained merely as one to clarify that a CDP determination of the Tax Court is a decision that is reviewable on appeal in another court. H.R. (Conf.) Rept. 106-1033 at 1024-1025.

In 2006, a few months before § 7623(b)(4) was enacted, Congress made the Tax Court the sole venue for appeal of CDP notices of determination by shortening § 6330(d)(1) to read, in full: “Judicial review of determination. — The person may, within 30 days of a determination under this section, appeal such determination to the Tax Court (and the Tax Court shall have jurisdiction with respect to such matter).” Pub. L. 109-280, § 855(a). This was the version of the CDP statute recently construed in Guralnik v. Commissioner, 146 T.C. 230 (2016), and Duggan v. Commissioner, 879 F.3d 1029 (9^th Cir. 2018). Section 7623(b)(4) tracks the language of § 6330(d)(1) as in effect just before § 7623(b)(4) was enacted. (Since December 2015, the word “appeal” has been removed from § 6330(d)(1) in favor of “review”; Pub. L. 114-113, Div. Q, § 424(a); though the word “appeal” still remains in § 7623(b)(4).)

Before discussing two court of appeals opinions issued earlier this year involving the CDP filing period under recent Supreme Court case law, the Clinic notes that, in Guralnik v. Commissioner, supra, the Clinic (as an amicus) asked the Tax Court to reconsider its long-standing position that the CDP filing deadline is jurisdictional. The Clinic noted that the Tax Court's position had been taken without any acknowledgement of post-Kontrick case law indicating that filing deadlines are now only rarely jurisdictional. The Clinic argued that the CDP filing deadline is not jurisdictional and is subject to equitable tolling under current Supreme Court case law.

The Tax Court rejected both arguments. Id. at 235-238.

Id. at 237.

The Clinic vehemently disagrees with the Tax Court that “such matter” includes filing periods. “Matter” most likely refers only to “subject matter”. Subject matter today does not include claims processing rules. Texas Tech Professor Bryan Camp has written:

Bryan Camp, “Guralnik — Equity Through Court Rules Not Court Rulings”, www.procedurallytaxing.com (June 6, 2016) (emphasis in original).

In Duggan v. Commissioner, supra — where the Clinic was also an amicus — the Ninth Circuit recently held that the CDP filing period is jurisdictional under the clear statement exception of current Supreme Court case law. Acknowledging that the legislative history of § 6330(d)(1) is silent on whether Congress intended the deadline to be jurisdictional, the court wrote:

Amicus insists that the statutory language is ambiguous. According to amicus, to tag § 6330(d)(1) 's filing deadline as jurisdictional, Congress needed to specify that:

Id., 879 F.3d at 1034 (some citations and footnote omitted). The Clinic believes that the Ninth Circuit overstates the clarity of § 6330(d)(1)'s language in making timely filing a condition of the Tax Court's jurisdiction. Especially since the Supreme Court has said that “Congress must do something special . . . to tag a statute of limitations as jurisdictional”; Wong, supra, 135 S. Ct. at 1632; the Ninth Circuit should not have allowed a less “pellucid” sentence to tag the CDP filing deadline as jurisdictional. The presumption these days is that filing deadlines should usually not be jurisdictional because of the potential harm to the courts and litigants of making filing deadlines jurisdictional. Henderson v. Shinseki, supra, 562 U.S. at 434-435.

The government brought the Duggan opinion to the attention of the Fourth Circuit in a case on all fours, where the Clinic represented the taxpayer. Notably, when the Fourth Circuit issued the opinion in its case, Cunningham v. Commissioner, 716 Fed. Appx. 182 (4^th Cir. 2018), the court made no reference to Duggan and explicitly declined to rule one way or the other on whether the CDP filing period is jurisdictional or subject to equitable tolling — not reaching those questions because the facts would not justify tolling in that case, in any event. The Fourth Circuit's action in Cunningham suggests that it considers the holding in Duggan arguably problematic.

B. Innocent Spouse Jurisdiction

If the IRS sends out a notice of determination denying an election or request for innocent spouse relief, the taxpayer has 90 days to file a petition contesting the denial in the Tax Court. Like § 7623(b)(4), the sentence in § 6015(e)(1)(A) that contains the 90-day filing period also contains the jurisdictional grant.

In Rubel v. Commissioner, 856 F.3d 301 (3d Cir. 2017), and Matuszak v. Commissioner, 862 F.3d 192 (2d Cir. 2017) (cases litigated by the Clinic), the courts relied on the clear statement exception to find that the 90-day filing period is jurisdictional. See, e.g., Matuszak at 196 (“Not only did Congress place the grant of jurisdiction and the time limitation in the same sentence and subsection, it expressly conditioned the Tax Court's jurisdiction on the timely filing of a petition: “the Tax Court shall have jurisdiction . . . if [the] petition is filed” within the specified period.”) (citation and footnote omitted; emphasis in original). The courts rejected the Clinic's argument that the wording of the 90-day period was not materially different from the wording of the sentence in Auburn that gave Medicare reimbursement boards the right to hear cases and that conditioned the grant with a final phrase saying “if” the appeal was brought in certain time periods. Rubel and Matuszak distinguished Auburn's statutory sentence from the one in § 6015(e)(1)(A) because the innocent spouse sentence, unlike the Medicare sentence, contains the words “shall have jurisdiction”. But, this must be a distinction without a difference, as there was no other sentence in the United States Code that granted “jurisdiction” to the Medicare reimbursement boards at issue in Auburn. Auburn did not turn on the absence of the word “jurisdiction” from the sentence, since the Court understood that part of the sentence made an implicit jurisdictional grant to the boards.

Further, § 6015(e)(1)(A) differs from § 7623(b)(4) in that the jurisdictional parenthetical in the former precedes the stated filing deadline and the former's sentence says the Tax Court shall have jurisdiction “if” the filing deadlines are complied with — which is far closer to a clear statement. Since there is no “if” condition in § 7623(b)(4), both Rubel and Matuszak construe distinguishable language.

Rubel and Matuszak also focused on an injunctive power in § 6015(e)(1)(B)(ii) given to the Tax Court to enforce a prohibition on collection while an innocent spouse election or request was pending before the IRS or the courts. The provision states that “the Tax Court shall have no [injunctive] jurisdiction . . . unless a timely petition has been filed under subparagraph A”. “Read alongside § 6015(e)(1)(B), the ninety‐day deadline in § 6015(e)(1)(A) represents '[t]he most obvious example' of a jurisdictional rule, because Congress clearly and repeatedly expressed that it imposes a jurisdictional limit on the Tax Court's authority.” Matuszak at 197 (citation omitted). Understandably, and by contrast, there is no parallel injunctive jurisdiction given to the Tax Court in connection with whistleblower award suits.

Thus, to the extent that Rubel and Matuszak are correct, the statute they construe is not similar enough to make those opinions instructive for interpreting § 7623(b)(4).

C. Deficiency Jurisdiction

Tilden v. Commissioner, 846 F.3d 882 (7^th Cir. 2017) (not involving the Clinic), held jurisdictional under recent Supreme Court case law the 90-(or 150-) day period in the first sentence of § 6213(a) in which a taxpayer may petition the Tax Court to redetermine a tax deficiency. Unlike § 7623(b)(4), the first sentence of § 6213(a), does not even contain the word “jurisdiction”. Despite the first sentence's not speaking in jurisdictional terms, Tilden cited the clear statement exception, noting that later sentences in the subsection provide a similar prohibition on collection while the Tax Court case is pending and a similarly-phrased jurisdictional grant to the Tax Court to enjoin premature collection only if a “timely petition has been filed”. Tilden observed that the word “jurisdiction” in the fourth sentence of § 6213(a) was a “magic word”. Id. at 886. Tilden also accorded staredecisis to a long list of pre-Kontrick opinions of the Tax Court and appellate courts holding the deficiency suit filing period jurisdictional.

Tilden is incompatible with Gonzalez v. Thaler, which instructs courts not to look to adjacent provisions to determine whether a filing deadline is jurisdictional.

Tilden also fails to note that the third sentence of § 6213(a) was only modified and the fourth sentence was only enacted to allow the Tax Court injunctive jurisdiction in 1988; Pub. L. 100-647, § 6243(a); whereas the first sentence of § 6213(a) has been in the tax laws (in one version or another) since 1924. See §§ 274(a) (for income tax) and 308(a) (for estate tax) of the Revenue Act of 1924, ch. 234. Since the Tax Court's authority to enjoin the IRS was added long after the first sentence of § 6213(a) and its predecessors were enacted, it should have no impact on the interpretation of the first sentence of § 6213(a), which is clearly a statute of limitations. Anyway, as noted with the previous comments on § 6015(e)(1)(A), the statute Tilden interprets is distinguishable from § 7623(b)(4), which contains no injunctive provisions.

Tilden also fails to observe that the grant for the Tax Court to redetermine deficiencies is not in § 6213(a), but in § 6214(a), which provides, in part: “Except as provided by section 7463, the Tax Court shall have jurisdiction to redetermine the correct amount of the deficiency. . . .” Dees v. Commissioner, 148 T.C. No. 1 at *18 (Feb. 2, 2017) (Ashford, J., concurring in the result only) (“Section 6214(a) establishes our deficiency jurisdiction”.); Moyer v. Commissioner, T.C. Memo. 2016-236 at *1 (“Moyer timely filed a petition under section 6213(a) for redetermination of the deficiency and the penalties. We have jurisdiction under section 6214(a).”; footnote omitted). Section 6214(a) has its origins in §§ 274(e) (for income tax) and 308(e) (for estate tax) of the Revenue Act of 1926, ch. 27.

Tilden also wrongly applies stare decisis to opinions of courts below the Supreme Court.

Finally, Tilden sought, but failed, to create “jurisdictional” symmetry for Article I courts. While it noted the Supreme Court's holding in John R.Sand that 28 U.S.C. § 2501's filing period for some Article I Court of Federal Claims actions is jurisdictional (though, only because of staredecisis); 846 F.3d at 886-887; it failed to note that in Henderson v. Shinseki, the Supreme Court held that the filing period for the Article I Court of Appeals for Veterans Claims actions is nonjurisdictional. Additionally, for tax cases, the relevant comparable time period to file a tax refund suit in the Court of Federal Claims is § 6532(a) (not 28 U.S.C. § 2501); Detroit TrustCo. v. United States, 131 Ct. Cl. 223 (1955); on which the Supreme Court has never made a jurisdictional ruling.

In sum, the badly-reasoned opinion in Tilden should not serve as instructive for cases involving the jurisdictional status of any Tax Court filing deadlines under the recent Supreme Court case law on jurisdiction.

CONCLUSION

This Court should hold that timely filing under § 7623(b)(4) is not a jurisdictional condition of a Tax Court whistleblower award suit.

Respectfully submitted,

Carlton M. Smith
Carlton M. Smith, Esq.
Counsel for Amicus
255 W. 23rd Street, Apt. 4AW
New York, New York 10011
(646) 230-1776
carltonsmth@aol.com

Dated: May 14, 2018