Shearin v. United States

Opinions of the United
2006 Decisions States Court of Appeals
for the Third Circuit
7-24-2006
Shearin v. USA
Precedential or Non-Precedential: Non-Precedential
Docket No. 05-1678
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 05-1678
________________
K. Kay Shearin
Appellant
v.
United States of America
____________________________________
On Appeal From the United States District Court
For the District of Delaware
(D.C. No. 02-cv-00266)
District Judge: Honorable Kent Jordan
_______________________________________
Submitted Under Third Circuit LAR 34.1(a)
June 7, 2006
Before: MCKEE, FUENTES AND NYGAARD, CIRCUIT JUDGES
(Filed: July 24, 2006 )
_______________________
OPINION
_______________________
PER CURIAM
K. Kay Shearin seeks a refund or credit for taxes she paid in 1993 and damages
against the IRS for unlawful collection. The District Court granted the IRS summary
judgment and this appeal followed.1 For the reasons below, we will affirm.
We recount only the facts relevant to the disposition of this appeal. In 1993
Shearin paid the IRS $10,000 for her tax liability for 1991 and 1992. In April 1997, she
filed tax returns for 1990 through 1996. In 1998, Shearin filed amended returns for 1991
and 1992 to remove some income. Based on this, she claimed a credit on her 1997 return.
The IRS did not allow the credit. The IRS informed Shearin that she was deficient in her
taxes and later filed liens against her bank account and house and filed a levy with her
employer. Shearin filed for bankruptcy in December 2001 and her tax liability for 1990-
1996 was discharged in March 2002. In the present suit, she seeks both a refund of her
payments from 1993 and damages for allegedly unlawful attempts to collect taxes.
Because Shearin is seeking a refund of taxes paid in 1993, her refund claim is
time-barred under 26 U.S.C. § 6511(b). Section 6511(b)(2)(A) limits the amount a
taxpayer can recover in a refund suit to money paid on the tax in question within three
years of the refund claim. In this case, the refund claim was on February 28, 1998.
Shearin cannot recover her 1993 payment.
We reject Shearin’s argument that the running of the statute of limitations was
tolled under § 6511(h) because that section does not apply to claims that were barred
before its effective date, July 22, 1998. See Historical and Statutory Notes for 26
U.S.C.A. § 6511. Because Shearin’s claim was already barred in 1996, § 6511(h) does
1
We have jurisdiction under 28 U.S.C. § 1291; our review is plenary, Camiolo v. State
Farm Fire & Cas. Co., 334 F.3d 345, 354 (3d Cir. 2003).
2
not apply. We also reject her claim for equitable tolling, which does not apply to § 6511.
United States v. Brockamp, 519 U.S. 347, 354 (1997) (“Congress did not intend the
“equitable tolling” doctrine to apply to § 6511’s time limitations.”); Doe v. KPMG, LLP,
398 F.3d 686, 689 (5th Cir. 2005) (confirming the continued force of Brockamp after
enactment of § 6511(h)).
Shearin tries to avoid the effect of § 6511(b)(2)(A) by arguing that her claim is
only for money paid in the three years prior to February 1998. She maintains that the
money paid in 1993 should have carried over to those years and reduced her tax liability
for 1995-1998. Shearin’s argument is evidently that a taxpayer who has paid taxes in the
previous three years can avoid § 6511(b)(2)(A) to the extent of those taxes simply by
filing a late return for the year for which she seeks a refund. This reasoning eviscerates
the “unusually emphatic” time limitations of § 6511, Brockcamp, 519 U.S. at 351, and we
reject it in light of the chief objective of Congress in enacting § 6511: “providing the
Government with strong statutory ‘protection against stale demands.’” Id. at 353 (quoting
United States v. Garbutt Oil Co., 302 U.S. 528, 533 (1938)); see also Carroll v. United
States, 339 F.3d 61, 76 (2nd Cir. 2003) (“The ‘tax paid’ therefore refers to the sum of
taxes, penalties, and interest paid for the tax year in question.”).
Shearin also claims that the IRS is liable under §§ 7432 & 7433 for violating the
Bankruptcy Court’s discharge under 11 U.S.C. § 524(a) and for violating the automatic
stay under 11 U.S.C. § 362(a). According to Shearin, the levy on her employer in
3
September 2004, and various tax notices she has received, violated the 2002 bankruptcy
discharge. However, she has not exhausted her administrative remedies for these claims
as required under both § 7432(d)(1) and § 7433(d)(1). The District Court, therefore, did
not have jurisdiction over these claims. Venen v. United States, 38 F.3d 100, 103 (3d Cir.
1994).2
Shearin also asserts that the IRS violated 11 U.S.C. § 362(a) by disregarding the
automatic stay. She claims that the violations constitute “unauthorized collection actions”
under 26 U.S.C. §§ 7432 & 7433. Both parties agree that the IRS filed a lien on her home
in 2000 and imposed levies on her bank account in April and August of 2001. These
actions could not have violated the automatic stay because they occurred before it began
on December 3, 2001.3
Shearin’s other arguments on appeal were either not presented to the District Court
or are without merit. We will, therefore, affirm the judgment of the District Court.
2
Shearin notes that the IRS did not raise the issue of exhaustion before the District
Court. However, because this is a jurisdictional question (see Venen, supra) it cannot be
waived. See In re Morrissey, 717 F.2d 100, 102 (3d Cir. 1983).
3
Although Shearin also points to a lien filed in February 2002, she did not refer to it in
the District Court, so we will not consider it here. Morris v. Hoffa, 361 F.3d 177, 191 (3d
Cir. 2004). The only action Shearin alleged before the District Court that occurred during
the automatic stay was the sending of a “Reminder Notice.” However, a bankruptcy court
had already found that the IRS did not violate the automatic stay by sending the notice.
See Doc. 53, Ex. C.
4