Nancy Rubel v. Commissioner Internal Revenue

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
______________
No. 16-3526
______________
NANCY M. RUBEL,
a.k.a NANCY M. ZAWADZKI
v.
COMMISSIONER OF INTERNAL REVENUE
NANCY M. RUBEL,
Appellant
______________
On Petition for Review from an Order of the United States
Tax Court
(Docket No. 16-9183)
United States Tax Court Chief Judge: Hon. L. Paige Marvel
______________
Argued March 16, 2017
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Before: GREENAWAY, JR., SHWARTZ, Circuit Judges,
and SIMANDLE, Chief District Judge.*
(Opinion Filed: May 9, 2017)
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OPINION
______________
T. Keith Fogg
Legal Services Center of Harvard Law School
122 Boylston Street
Jamaica Plain, MA 02130
Carlton M. Smith [ARGUED]
#4AW
255 West 23rd Street
New York, NY 10011
Counsel for Appellant
Richard P. Caldarone [ARGUED]
Gilbert S. Rothenberg
Francesca Ugolini
United States Department of Justice
Tax Division
950 Pennsylvania Avenue, N.W.
P.O. Box 502
Washington, DC 20044
Counsel for Appellee
*
Honorable Jerome B. Simandle, Chief District Judge
of the United States District Court for the District of New
Jersey, sitting by designation.
2
SHWARTZ, Circuit Judge.
Nancy Rubel appeals the United States Tax Court’s
dismissal of her petition for lack of jurisdiction. Because
Rubel failed to file her petition by the deadline set forth in 26
U.S.C. § 6015(e)(1)(A), and because that deadline is
jurisdictional, the Tax Court properly dismissed her petition,
and we will affirm.
I
Generally, when spouses file a joint tax return, each
spouse is jointly and severally liable for the tax due. 26
U.S.C. § 6013(d); Callaway v. Comm’r, 231 F.3d 106, 111
(2d Cir. 2000). Under § 6015(c), a jointly filing spouse may
seek relief from joint and several liability for a tax deficiency
if the couple is legally separated, no longer married, and not
living together.1 § 6015(c). In addition, for taxpayers who do
not satisfy § 6015(c), the IRS has discretion to grant relief
where it would be “inequitable to hold the individual liable
for any . . . deficiency.” Id. § 6015(f). These avenues for
relief are referred to as the innocent spouse relief provisions.
If the IRS denies relief, then the taxpayer may file a petition
with the Tax Court. Id. § 6015(e).
Rubel and her ex-husband filed joint income tax
returns from 2005 through 2008. They had an unpaid tax
liability for each year. In 2015, Rubel asked the IRS to
1
Section 6015(b) provides an avenue to seek relief
where the joint return understates the amount the taxpayers
owe. 26 U.S.C. § 6015(b).
3
relieve her from this liability under the innocent spouse relief
provisions of § 6015.
On January 4, 2016, the IRS sent Rubel three identical
notices of its final determination denying her requests for
relief for tax years 2006 through 2008. On January 13, 2016,
the IRS sent Rubel a similar denial for the 2005 tax year. The
determinations notified Rubel that, if she disagreed with the
IRS’s decision, she could file a petition with the Tax Court to
review the denial for relief within ninety days from the date
of the determination. Accordingly, Rubel needed to file a
petition with the Tax Court by April 4, 20162 for the 2006
through 2008 tax years and by April 12, 2016 for the 2005 tax
year.
Before filing a petition with the Tax Court, Rubel
submitted additional information to the IRS. In a March 3,
2016 letter, the IRS informed Rubel that it “considered the
information and still propose[d] to deny relief in full.” App.
45. The IRS also notified Rubel of the following:
Please be advised this correspondence doesn’t
extend the time to file a petition with the U.S.
Tax Court. Your time to petition the U.S. Tax
Court began to run when we issued you our
final determination on Jan. 04, 2016 and will
end on Apr. 19, 2016. However, you may
continue to work with us to resolve your tax
2
The ninetieth day after January 4, 2016, was Sunday,
April 3, 2016. The Internal Revenue Code provides that the
deadline for filing a petition is extended until the “next
succeeding day which is not a Saturday, Sunday, or a legal
holiday.” Id. § 7503.
4
matter.
App. 45. This letter contained incorrect information. The
deadlines for Rubel to petition the Tax Court regarding the
final determinations were April 4 and 12, 2016, not April 19,
2016.
Rubel mailed a petition challenging the IRS’s
determinations to the Tax Court on April 19, 2016. The IRS
moved to dismiss the petition, arguing that because Rubel
failed to file the petition within ninety days of the date of the
notices of final determination, the Tax Court lacked
jurisdiction to review the petition under § 6015(e)(1)(A).
Rubel opposed the motion and argued that the March 3, 2016
letter started a new ninety-day period for filing a petition and,
in any event, that the IRS should be equitably estopped from
relying on the statutory deadline because the March 3 letter
contained erroneous information. The Tax Court agreed with
the IRS and dismissed the petition for lack of jurisdiction.
Rubel appeals.
II3
Congress set forth the jurisdiction of the Tax Courts in
Title 26. 26 U.S.C. § 7442. Thus, we turn to Title 26 to
determine whether the Tax Court had jurisdiction to entertain
3
The Tax Court held that it lacked jurisdiction over
the petition because it was not filed within the deadline set
forth in § 6015(e)(1)(A). We have jurisdiction to review the
decision of the Tax Court under 26 U.S.C. § 7482(a)(1) and
conduct a de novo review of its determination of subject
matter jurisdiction. Sunoco Inc. v. Comm’r, 663 F.3d 181,
185 (3d Cir. 2011).
5
Rubel’s petition to review the IRS’s denial of her request for
innocent spouse relief under § 6015. Section 6015 provides:
In the case of an individual . . . who requests
equitable relief[,] . . . the individual may
petition the Tax Court (and the Tax Court shall
have jurisdiction) to determine the appropriate
relief available to the individual under this
section if such petition is filed . . . not later than
the close of the 90th day after the date [on
which the IRS mails notice of its final
determination of relief available to the
individual].
Id. § 6015(e)(1)(A). The question in this case is whether the
ninety-day deadline in § 6015(e)(1)(A) is a jurisdictional
requirement or a claims-processing deadline.4 If
§ 6015(e)(1)(A) is a claims-processing statute, Rubel’s failure
to comply with it may be subject to waiver, forfeiture, and
equitable tolling. John R. Sand & Gravel Co. v. United
States, 552 U.S. 130, 133-34 (2008). If, on the other hand,
the deadline in § 6015(e)(1)(A) is jurisdictional, Rubel’s
failure to comply with it deprives the Tax Court of the
authority to hear the case, “even if equitable considerations
would support extending the prescribed time period.” United
States v. Kwai Fun Wong, 135 S. Ct. 1625, 1631 (2015).
Thus, determining that a deadline is jurisdictional has the
4
A claims-processing statute or rule “promote[s] the
orderly progress of litigation by requiring parties to take
certain procedural steps at certain specified times.”
Henderson ex rel. Henderson v. Shinseki, 562 U.S. 428, 435
(2011).
6
important consequence of limiting a court’s power to decide a
case. See Henderson ex rel. Henderson v. Shinseki, 562 U.S.
428, 435 (2011).
Because of the consequence of deeming a deadline
jurisdictional, the Supreme Court has cautioned against “drive
by jurisdictional rulings,” Arbaugh v. Y&H Corp., 546 U.S.
500, 511 (2006) (internal quotation marks omitted), and has
directed that we examine statutes to determine if they “speak
in jurisdictional terms or refer in any way to the jurisdiction
of the . . . courts,” Zipes v. Trans World Airlines, 455 U.S.
385, 394 (1982). As a result, to determine whether a statutory
deadline is jurisdictional or claims processing in nature, we
examine the “text, context, and relevant historical treatment”
of the provision. Reed Elsevier, Inc. v. Muchnick, 559 U.S.
154, 166 (2010). In examining the text, we look at the plain
language to determine if it speaks in jurisdictional terms,
meaning whether it speaks “to the power of the court rather
than to the rights or obligations of the parties.”5 Landgraf v.
USI Film Prods., 511 U.S. 244, 274 (1994) (internal quotation
marks omitted). One way Congress speaks in such terms is
when it clearly labels a requirement as jurisdictional. Reed
Elsevier, Inc., 559 U.S. at 166.
Section 6015(e)(1)(A) states that “the Tax Court shall
have jurisdiction” if an individual files a petition in the court
no later than ninety days after the IRS mails its notice of final
5
Section 6015(e)(1)(A) embodies the obligation of a
litigant to seek relief within ninety days after the IRS’s final
determination and, embedded within it, explicitly states that
the Tax Court has jurisdiction if the petition is filed within
that deadline.
7
determination. For purposes of this analysis, we must
presume that Congress knows that the term “jurisdiction”
refers to the authority of a court to hear and decide a case and
that it deliberately included that word in the statute.
Shendock v. Dir., Office of Workers’ Comp. Programs, 893
F.2d 1458, 1462 (3d Cir. 1990) (en banc). Therefore, in
circumstances like this, where Congress “clearly states that a
threshold limitation on a statute’s scope shall count as
jurisdictional, then courts and litigants will be duly instructed
and will not be left to wrestle with the issue.” Arbaugh, 546
U.S. at 515-16 (footnote omitted). Accordingly, Congress’s
explicit statement that § 6015(e)(1)(A)’s time limit is
jurisdictional means that it is and that the Tax Court lacks
authority to consider untimely petitions.6
While we need not analyze the issue further, other
tools of statutory construction bolster our conclusion that §
6015(e)(1)(A)’s time limit is jurisdictional. First, the context
of the provision—how § 6015(e)(1)(A) fits within the statute
as a whole—shows that it is jurisdictional. See Kwai Fun
Wong, 135 S. Ct. at 1628. The statute’s grant of jurisdiction
to the Tax Court and the time limit for activating that
jurisdiction are located within the same provision. See §
6
Section 6330, which deals with judicial review of tax
levy determinations, contains a similarly worded time
limitation that our sister circuits have held to be jurisdictional.
26 U.S.C. § 6330(d)(1) (providing that a “person may, within
30 days of a determination under this section, petition the Tax
Court for review of such determination (and the Tax Court
shall have jurisdiction with respect to such matter)”);
Hauptman v. Comm’r, 831 F.3d 950, 953 (8th Cir. 2016);
Gray v. Comm’r, 723 F.3d 790, 793 (7th Cir. 2013).
8
6015(e)(1); see also Kwai Fun Wong, 135 S. Ct. at 1628
(observing that when Congress separates a filing deadline
from a jurisdictional grant the deadline is often not
jurisdictional). Moreover, the provision is located within the
same subsection of § 6015 that sets forth other conditions that
trigger or limit the Tax Court’s jurisdiction. § 6015(e)(3)
(setting forth the limitations on the Tax Court’s jurisdiction);
see also Bartman v. Comm’r, 446 F.3d 785, 787 (8th Cir.
2006) (holding that notice of deficiency described in
6015(e)(1) is a jurisdictional prerequisite); Comm’r v. Ewing,
439 F.3d 1009, 1012-13 (9th Cir. 2006) (same). In addition,
the filing period and the filing of the petition itself impacts
the IRS’s ability to begin its collection efforts. More
specifically, § 6015(e)(1)(B)(i) provides that no levy or
collection proceeding can commence during the ninety-day
window to petition for relief or, if a petition is filed in the Tax
Court, until the Tax Court’s decision becomes final. This
further reflects that the ninety-day period is meant to allocate
when different components of the tax system have the
authority to act and further supports the view that § 6015(e) is
jurisdictional. Thus, the structure of § 6015 reflects
Congress’s intent to set the boundaries of the Tax Court’s
authority.7
7
Petitioner relies on Sebelius v. Auburn Reg’l Med.
Ctr., 133 S. Ct. 817 (2013), but it does not help her position.
The statute at issue there set forth the time-frame within
which a healthcare provider had to file an administrative
appeal from a Medicare reimbursement determination. The
statute provides that the provider “may obtain a hearing” from
the administrative board if “such provider files a request for a
hearing within 180 days after the notice of . . . final
determination.” 42 U.S.C. § 1395oo(a)(3). The Supreme
9
Second, the Supreme Court has historically found that
filing deadlines in tax statutes are jurisdictional because
allowing case-specific exceptions and individualized equities
could lead to unending claims and challenges and upset the
IRS’s need for “finality and certainty.” Becton Dickinson &
Co. v. Wolckenhauer, 215 F.3d 340, 351 (3d Cir. 2000);
accord United States v. Brockamp, 519 U.S. 347, 349-54
Court held that the 180-day deadline was not a jurisdictional
deadline because the provision does not “speak in
jurisdictional terms” and “contains neither the mandatory
word ‘shall’ nor the appellation ‘notice of appeal,’ words with
jurisdictional import.” Auburn Reg’l Med. Ctr., 133 S. Ct. at
824-25; see also V.L. v. E.L., 136 S. Ct. 1017, 1021 (2016)
(reviewing a state statute, which sets forth the conditions
under which a child with living parents may be adopted,
“does not speak in jurisdictional terms” and observing that its
use of mandatory language alone is insufficient to deem
jurisdictional). Section 6015(e)(1), in contrast, speaks in
jurisdictional terms by it use of the word “shall” and
“jurisdiction” in the same sentence.
Moreover, while “filing deadlines ordinarily are not
jurisdictional,” Auburn Reg’l Med. Ctr., 133 S. Ct. at 825,
Congress’s use of language that “speaks in jurisdictional
terms” makes the deadline jurisdictional. It spoke in such
terms in § 6015(e)(1), by using the word “jurisdiction” and
structuring the section so jurisdiction is triggered by the
timely filing of a petition and its placement of the deadline
with other items that related to jurisdiction. As a result,
unlike the statute in Auburn, § 6015 “duly instruct[s]” us to
treat the ninety-day deadline as jurisdictional. Arbaugh, 546
U.S. at 515.
10
(1997) (“Tax law . . . is not normally characterized by case-
specific exceptions reflecting individualized equities.”).
Rigid deadlines, such as those embodied in the tax law’s
jurisdictional requirements, promote predictability of the
revenue stream, which is vital to the government. See Becton
Dickinson, 215 F.3d at 348 (stating that “the nature of the
underlying subject matter—tax collection” underscores the
need for an emphatic deadline (quoting Brockamp, 519 U.S.
at 352)).
For these reasons, the Tax Court correctly concluded
that it lacked jurisdiction to consider Rubel’s untimely
petition. While the IRS’s administrative mistake in its March
3, 2016 letter may have contributed to Rubel’s delay and
resulting inability to have the IRS’s innocent spouse
determination subjected to judicial review, the ninety-day
deadline is jurisdictional and cannot be altered “regardless of
the equities” of the case,8 Becton Dickinson, 215 F.3d at 345;
see also Sebelius v. Auburn Reg’l Med. Ctr., 133 S. Ct. 817,
824 (2013) (observing that if a deadline is jurisdictional, it is
not subject to equitable tolling). Thus, the Tax Court was
required to dismiss the petition.
III
For the foregoing reasons, we will affirm the Tax
Court’s dismissal of Rubel’s petition for lack of jurisdiction.
8
While the Tax Court and this Court cannot alter a
jurisdictional deadline, and the taxpayer is responsible for
calculating when the deadline expires, we remind the IRS to
exercise care when drafting correspondence to a taxpayer to
assure it is accurate.
11