Jose Reynoso v. United States

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
JOSE REYNOSO,  No. 11-15181
Plaintiff-Appellant,
v.  D.C. No.
3:10-cv-00098-SC
UNITED STATES OF AMERICA,
OPINION
Defendant-Appellee.

Appeal from the United States District Court
for the Northern District of California
Samuel Conti, Senior District Judge, Presiding
Argued and Submitted
May 14, 2012—San Francisco, California
Filed August 28, 2012
Before: Stephen Reinhardt, Richard R. Clifton, and
N. Randy Smith, Circuit Judges.
Opinion by Judge N.R. Smith
9911
9914 REYNOSO v. UNITED STATES
COUNSEL
Paul Ham, Esq., San Francisco, California, for the plaintiff-
appellant.
Bruce R. Ellisen, and Carol Barthel, United States Depart-
ment of Justice, Tax Division, Tamara W. Ashford (argued),
Deputy Assistant Attorney General, United States Department
of Justice, Washington, D.C., for the respondent-appellee.
REYNOSO v. UNITED STATES 9915
OPINION
N.R. SMITH, Circuit Judge:
A taxpayer’s claim for credit of an overpayment is limited
to the amount of the overpayment made within of the applica-
ble look-back period in § 6511(b)(2)(A) of the Internal Reve-
nue Code (the “I.R.C.” or the “Code”).1 Any claim for refund
based on an amount claimed as a credit but paid outside of the
§ 6511(b)(2)(A) look-back period is time barred and uncol-
lectible. Therefore, we affirm the district court, because Jose
Reynoso’s claim for credit of his $117,527 overpayment of
his 1999 taxes was time-barred under § 6511(b)(2)(A).
I. BACKGROUND
A. FACTS
Jose Reynoso was charged with and pleaded guilty to three
misdemeanor counts for not filing tax returns for 1999, 2000,
and 2001. Although Reynoso did not file returns for these
years, he made tax payments during these years. As payments
toward his 1999 estimated tax liability, on April 21, 1999
Reynoso paid $25,000 and on April 15, 2000 Reynoso paid
$220,000. On April 15, 2001, Reynoso paid $200,000 toward
his 2000 tax liability. On April 15, 2002, he paid $200,000
toward his 2001 tax liability.
1
All statutes cited herein are found in the Code, which is codified at
Title 26 of the United States Code. Moreover, § 6511(b)(2)(A) of the Code
states in pertinent part:
(2) Limit on amount of credit or refund
(A) Limit where claim filed within 3-year period
If the claim was filed by the taxpayer during the 3-year period
prescribed in subsection (a), the amount of the credit or refund
shall not exceed the portion of the tax paid within the period,
immediately preceding the filing of the claim, equal to 3 years
plus the period of any extension of time for filing the return.
9916 REYNOSO v. UNITED STATES
As a result of the criminal proceedings, and notwithstand-
ing Reynoso’s previous tax payments, the IRS designated
$585,329 of Reynoso’s funds it was holding as a cash bond
to offset Reynoso’s anticipated tax liability for 1999, 2000,
and 2001. On December 13, 2005, the IRS applied $75,852,
$278,338, and $51,913 of the cash bond toward Reynoso’s
1999, 2000, and 2001 tax liability, respectively. The IRS
transferred the remaining $179,227 of the cash bond to an
excess collection account.
In 2007 and 2008, Reynoso filed his tax returns for 1999,
2000, and 2001.2 His tax liabilities for each year were:
$127,473 for 1999; $238,328 for 2000; and $231,042 for
2001. Based on his tax liabilities, 1999 was the only year that
his initial payments (not counting the application of the cash
bond) exceeded his tax liability. Reynoso’s 1999 tax pay-
2
Reynoso obtained a four-month extension to file his 1999 tax return
and a six-month extension to file his 2000 tax return. The extensions are
relevant, because § 6511(b)(2)(A) accounts for extensions of time for fil-
ing returns in determining its limitations period.
Notwithstanding the extensions, Reynoso filed his 1999 tax return
(Form 1040) on August 6, 2007, and he claimed a tax liability of $125,618
and an overpayment of $119,382. Reynoso filed another 1999 tax return
on December 5, 2007. In the return filed in December, Reynoso corrected
the tax liability to $127,473, listed an overpayment of $117,527 (on line
65), and listed the overpayment on line 67. Line 67 stated: “Amount of
line 65 you want Applied to Your 2000 Estimated Tax.”
Reynoso filed his 2000 tax return on May 22, 2008. On line 59 of the
2000 tax return Reynoso listed $117,527 as “2000 estimated tax payments
and amount applied from 1999 return.” He claimed a 2000 tax year over-
payment of $79,199, which he requested to be applied to his estimated
taxes for 2001.
On December 12, 2008, Reynoso filed a Form 1040X (“Amended Indi-
vidual Income Tax Return”) for his 1999, 2000, and 2001 tax years, which
he annotated “Protective Claim for Refund.” On his 1999 Form 1040X,
Reynoso listed a total overpayment of $193,379. He designated $75,852
to be refunded and $117,527 to be “APPLIED TO YOUR 2000 ESTI-
MATED TAX.” The 2000 Form 1040X listed a total overpayment of
$357,537 (which included the $117,527).
REYNOSO v. UNITED STATES 9917
ments made in April 1999 and April 2000 (totaling $245,000)
exceeded his 1999 tax liability of $127,473 by $117,527. This
is significant because § 6511(b)(2)(A)’s look-back period
does not allow overpayment amounts to be credited or
refunded if the overpayments were made more than three
years (plus any time granted for extensions) prior to the date
the tax return is filed. Reynoso claimed a credit for the 1999
overpayment in his 1999 tax return filed on December 5,
2007.
Sometime between February 6, 2009 and April 6, 2009, the
IRS applied the $117,527 1999 overpayment to Reynoso’s
2000 tax year, as requested in Reynoso’s tax return. An IRS
agent later said that the IRS mistakenly applied the overpay-
ment to the 2000 tax account. The IRS agent did not think the
IRS was permitted to move the money based on the Code.
On April 23, 2009, Reynoso sent a letter to the IRS request-
ing a refund for the overpayments caused by the application
of the cash bond to the 1999, 2000, and 2001 tax years and
for the unapplied cash bond amount. Reynoso also claimed a
refund for the $117,527 amount that was credited to his 2000
taxes as an overpayment of his 2000 taxes. Therefore,
Reynoso sought a total refund of $612,197, which included
the $117,527 overpayment.
B. PROCEDURAL HISTORY
On January 8, 2010, Reynoso filed suit to recover the
asserted overpayments totaling $612,197, including the
$117,527 overpayment. Reynoso filed a motion for summary
judgment, and the Government also moved for summary
judgment asserting that Reynoso’s requested refund should be
reduced by $117,527. The Government admitted that Reynoso
was entitled to a refund amount requested except for the
$117,527 overpayment. The IRS argued that the $117,527
overpayment in 1999, which was credited to the 2000 tax
9918 REYNOSO v. UNITED STATES
year, was time-barred because it related to payments made
before the look-back period under § 6511(b)(2)(A).
The district court held that the $117,527 was time-barred
by § 6511(b)(2)(A). Reynoso made payments totaling
$245,000 toward his 1999 taxes in April 1999 and 2000,
which generated the $117,527 overpayment. On his 1999 tax
return filed on December 5, 2007, Reynoso requested that the
$117,527 overpayment be applied from his 1999 tax account
to his 2000 tax account. Citing Treasury Regulation
§ 301.6402-3(a)(1), the district court held that this constituted
a claim for credit. See Treas. Reg. § 301.6402-3(a)(1).
“Therefore, [Reynoso] filed the claim for credit more than
seven years after making the overpayment, and, as such, the
claim for credit is clearly untimely under section 6511.”
Reynoso conceded that recovery would be barred by
§ 6511, if the IRS did not actually credit the $117,527 some-
time between February 6, 2009 and April 6, 2009. However,
Reynoso argued that, because the IRS made the credit, the
claim for refund in 2009 was timely. The district court
rejected the argument. The district court noted that “the rele-
vant claim [was] not Reynoso’s 2009 claim for a refund, but
rather his 2007 claim for a credit.” The district court held that
the IRS had no authority to make the credit, because the claim
for credit was time-barred. Further, citing United States v.
Brockamp, 519 U.S. 347, 352 (1997), the district court stated
that “[t]he IRS’s mistake d[id] not create an equitable excep-
tion to the strict time limits of section 6511.” Thus, the district
court held that Reynoso’s 2007 claim for credit was untimely,
and Reynoso “is barred from recovering $117,527 of his over-
payment.”
On January 19, 2011, the district court entered judgment
awarding Reynoso a total of $657,319. The award included
$75,852 for the 1999 tax overpayment resulting from applica-
tion of the cash bond, $239,591 for the 2000 tax overpayment
resulting from application of the cash bond, $179,227 for the
REYNOSO v. UNITED STATES 9919
unapplied cash bond, and $162,649 in interest. The district
court did not award the $117,527 overpayment related to
Reynoso’s 1999 tax year. Reynoso filed a timely notice of
appeal. The only issue appealed is the denial of the $117,527
overpayment.
II. JURISDICTION AND STANDARD OF REVIEW
Pursuant to 28 U.S.C. § 1291, we are authorized to review
the district court’s decision. We review the district court’s
determination that it lacked subject matter jurisdiction de
novo. Fed. Deposit Ins. Corp. v. Nichols, 885 F.2d 633, 635
(9th Cir. 1989). Furthermore, we “review de novo both the
district court’s summary judgment and its interpretation of the
Internal Revenue Code.” Aloe Vera of Am., Inc. v. United
States, 580 F.3d 867, 870 (9th Cir. 2009).
III. DISCUSSION
This case turns on the applicability and application of
§ 6511 and other related sections of the Code. Section 6511
limits the extent to which an overpayment may be credited or
refunded. Section 6511(a) provides a time limit in which
claims for a credit or refund of an overpayment must be filed.
However, even if a taxpayer files a claim in accordance with
§ 6511(a), § 6511(b) limits the amount that may be credited
or refunded based on when the taxpayer made the overpay-
ment as compared to when the taxpayer filed the return.
Reynoso’s claim for credit and claim for refund must comply
with both subsections in order for him to be entitled to relief.
A. Period of Limitation on Filing Claim for Credit or
Refund
[1] Section 6511 establishes the applicable limitations
period for filing claims for tax credits or refunds related to tax
overpayments. First, under § 6511(a), a “[c]laim for credit or
refund of an overpayment of any tax . . . shall be filed by the
9920 REYNOSO v. UNITED STATES
taxpayer within 3 years from the time the return was filed or
2 years from the time the tax was paid, whichever of such
periods expires the later . . . .” I.R.C. § 6511(a). “In general,
in the case of an overpayment of income taxes, a claim for
credit or refund of such overpayment shall be made on the
appropriate income tax return.” Treas. Reg. § 301.6402-
3(a)(1); id. at (a)(5) (“A properly executed individual . . .
income tax return or an amended return . . . shall constitute
a claim for refund or credit within the meaning of section
6402 and section 6511 . . . .”).
[2] Here, Reynoso’s claim for credit of his $117,527 over-
payment of his 1999 tax liability, and the subsequent claim
for refund for the same amount, complied with § 6511(a).
Reynoso filed his 1999 tax return in 2007 and filed his 2000
tax return in 2008. The 1999 return constituted a claim for
credit, because it specified that the $117,527 overpayment
should be applied to his 2000 estimated tax. See Treas. Reg.
§ 301.6402-3(a)(1), (5). Similarly, the refund requested in his
2000 return constituted a claim for refund. See id. Both the
claim for credit in Reynoso’s 1999 tax return and the subse-
quent claim for refund in his 2000 tax year were made within
§ 6511(a)’s three-year time requirement, because the claims
for credit and refund were filed concurrently with the tax
returns for those years. Further, even if Reynoso’s April 23,
2009 letter to the IRS claiming a refund were to be deemed
the claim for refund, it too was filed within three years from
the date Reynoso’s tax returns for 1999 and 2000 were filed.
Therefore, Reynoso’s claim for credit of the $117,527 over-
payment and the subsequent claim for refund complied with
§ 6511(a).
B. Look-Back Period: Limit on Amount of Credit or
Refund
While Reynoso’s claim for credit and subsequent claim for
refund satisfied § 6511(a), his claim for credit did not satisfy
the additional limitation in § 6511(b)(2)(A).
REYNOSO v. UNITED STATES 9921
[3] Section 6511(b)(2)(A) limits the amount of a claimed
credit or refund of an overpayment. Chemical Bank N.Y. Trust
Co. v. United States, 275 F. Supp. 26, 31 (S.D.N.Y.), aff’d,
386 F.2d 995 (2d Cir. 1967) (per curiam); see Burr v.
Comm’r, T.C. Memo 2002-69, at *3 (2002). In pertinent part,
§ 6511(b)(2)(A) states: “[T]he amount of the credit or refund
shall not exceed the portion of the tax paid within the period,
immediately preceding the filing of the claim, equal to 3 years
plus the period of any extension of time for filing the return.”
Thus, “[§ ] 6511(b)(2)(A) provides that a claim for credit for
an overpayment of tax may not be asserted for an overpay-
ment which was paid more than 3 years [plus any allowed
extension time] prior to the claim.” Chemical Bank, 275 F.
Supp. at 31.
[4] Section 6513(b)(2) establishes the date overpayments
are deemed paid for purposes of § 6511(b)(2)(A). Baral v.
United States, 528 U.S. 431, 432, 435-36 (2000); Harrigill v.
United States, 410 F.3d 786, 789 (5th Cir. 2005) (“For the
purposes of § 6511(b)(2)(A), a payment of estimated tax is
deemed to have been made on the due date of the tax return
for that year.” (citing I.R.C. § 6513(b)). Section 6513(b)(2)
states: “For purposes of section 6511 . . . , [a]ny amount paid
as estimated income tax for any taxable year shall be deemed
to have been paid on the last day prescribed for filing the
return under section 6012 for such taxable year (determined
without regard to any extension of time for filing such
return).” Accord Chemical Bank, 275 F. Supp. at 31. Gener-
ally, “[i]n the case of returns under section 6012, . . . returns
made on the basis of the calendar year shall be filed on or
before the 15th day of April following the close of the calen-
dar year . . . .” I.R.C. § 6072(a). Therefore, under
§ 6513(b)(2), Reynoso’s payments of estimated tax leading to
his $117,527 overpayment for his 1999 tax year are deemed
paid on April 15, 2000.
[5] Here, because Reynoso’s $117,527 overpayment is
deemed paid in 2000, his claim for credit in his 1999 tax
9922 REYNOSO v. UNITED STATES
return filed December 5, 2007 clearly falls outside of
§ 6511(b)(2)(A)’s look-back period, and thus, his claim for
credit was time-barred. Reynoso originally obtained a four-
month extension to file his 1999 tax return. Therefore, Reyno-
so’s 1999 tax return filed on December 5, 2007 constituted his
claim for credit of the $117,527 overpayment, the $117,527
overpayment must have been paid by August 5, 2004 (three
years and four months prior to Reynoso’s 1999 tax return).
See I.R.C. § 6511(b)(2)(A). Because Reynoso’s payments
leading to the $117,527 overpayment of his 1999 taxes were
deemed paid on April 15, 2000 pursuant to § 6513(b)(2),
Reynoso’s overpayment was paid over four years before the
outer limit of § 6511(b)(2)(A)’s look-back provision.
1. Section 6513(d) Does Not Apply, But Even If It Did,
§ 6511(b)(2)(A) Still Bars Reynoso’s Claim of Credit
[6] Section 6513(d)3 does not change the outcome. First,
§ 6513(d) does not apply when “the claim for credit [has not]
been asserted within the period fixed by [§ 6511(b)(2)(A)].”4
3
Section 6513(d) states the following:
(d) Overpayment of income tax credited to estimated tax
If any overpayment of income tax is, in accordance with section
6402(b), claimed as a credit against estimated tax for the suc-
ceeding taxable year, such amount shall be considered as a pay-
ment of the income tax for the succeeding taxable year (whether
or not claimed as a credit in the return of estimated tax for such
succeeding taxable year), and no claim for credit or refund of
such overpayment shall be allowed for the taxable year in which
the overpayment arises.
4
The Government argued to the district court that Reynoso’s 1999 over-
payment was deemed paid on April 15, 2000, pursuant to § 6513(b). The
district court concluded that the deemed paid date should be April 15,
2001, pursuant to subsections (b) and (d) of § 6513. The district court
made this determination based on the Government’s assertion that “Plain-
tiff’s claim for a refund of the estimated tax payment of $117,527 is time-
barred.” Thus, the district court made its finding based on the allegation
(and assumption) that the $117,527 was an estimated tax payment for
2000.
REYNOSO v. UNITED STATES 9923
Chemical Bank, 275 F. Supp. at 31. Section 6513(d) requires
“any overpayment . . . claimed as a credit against estimated
tax for the succeeding taxable year” to be “in accordance with
section 6402(b) . . . .”
[7] Section 6402(a) allows, “[i]n the case of any overpay-
ment, the Secretary, within the applicable period of limita-
tions, [to] credit the amount of such overpayment . . . against
any liability in respect of an internal revenue tax on the part
of the person who made the overpayment . . . .” I.R.C.
§ 6402(a) (emphasis added). Further, “[t]he Secretary is
authorized to prescribe regulations providing for the crediting
against the estimated income tax for any taxable year of the
amount determined by the taxpayer or the Secretary to be an
overpayment of the income tax for a preceding taxable year.”
I.R.C. § 6402(b). Treasury Regulation 301.6402-2(a)(1) states
that
[c]redits . . . of overpayments may not be allowed or
made after the expiration of the statutory period of
limitation properly applicable unless, before the
expiration of such period, a claim therefor has been
filed by the taxpayer. Furthermore, under section
7422, a civil action for refund may not be instituted
unless a claim has been filed within the properly
applicable period of limitation.
(emphasis added). These statutory and regulatory provisions
“make[ ] it clear that an overpayment may not be credited
The district court subsequently recognized that the real dispute relates
to the claim for credit, and it found that the IRS had no authority to make
the transfer of the $117,527 as an estimated tax payment for the 2000 tax
year. Therefore, the district court did not hold that Reynoso’s overpay-
ments were deemed paid on April 15, 2001, pursuant to subsections (b)
and (d) of § 6513, for purposes of deciding whether a claim for credit was
valid.
9924 REYNOSO v. UNITED STATES
against estimated tax for the following year and be deemed to
have been paid in the following year for the purpose of the
statute of limitations unless the claim for credit itself is
asserted within the statutory period.” Chemical Bank, 275 F.
Supp. at 31. Therefore, § 6402(b) and the applicable treasury
regulations require a claim for credit be made within the look-
back period of § 6511(b)(2)(A). A claim for credit asserted
outside the look-back period is invalid for purposes of
§ 6402(b). As such, § 6513(d) does not apply here, because
Reynoso’s claim for credit occurred approximately seven
years after the overpayment was sought to be credited. “Any
other result would lead to a complete emasculation of the stat-
ute of limitations.” Chemical Bank, 275 F. Supp. at 31.
Notwithstanding, even assuming that § 6513(d) applied,
Reynoso’s overpayment would be deemed paid on April 15,
2001, approximately three years before Reynoso’s overpay-
ment had to be paid pursuant to § 6511(b)(2)(A). Therefore,
Reynoso’s payments would still be deemed paid well before
the applicable look-back period in § 6511(b)(2)(A).
2. Section 7422(d) Does Not Establish the Date An
Overpayment is Deemed Paid for Purposes of
§ 6511(b)(2)(A)
Reynoso argues that, because the IRS allowed his $117,527
credit in 2009, it was deemed paid in 2009 pursuant to
§ 7422(d) and within § 6511(b)(2)(A)’s look-back period. The
argument fails, because § 7422(d) does not apply as Reynoso
suggests.
[8] Section 7422(d) does not establish a “deemed paid”
date for purposes of § 6511. A taxpayer must have paid his
taxes in full before bringing a claim for refund. See Flora v.
United States, 357 U.S. 63, 68-69 (1958), aff’d on reh’g, 362
U.S. 145 (1960); see also Thomas v. United States, 755 F.2d
728, 729 (9th Cir. 1985). Section 7422(d) states: “The credit
of an overpayment of any tax in satisfaction of any tax liabil-
REYNOSO v. UNITED STATES 9925
ity shall, for the purpose of any suit for refund of such tax lia-
bility so satisfied, be deemed to be a payment in respect of
such tax liability at the time such credit is allowed.” Based on
the text of the statute and the rule that taxes must be paid in
full before commencing a suit for refund, § 7422(d) deals
only with the question of when a credit of an overpayment
will be treated as a payment for purposes of being able to
bring a suit for refund. Under § 7422(d), if a taxpayer requests
a credit of an overpayment, but brings suit before that credit
is allowed, that credit is not considered a payment and thus
the suit is barred; it is only after the credit is allowed that the
credit is considered a payment, and the taxpayer considered
to have paid his taxes in full, and the suit allowed to go for-
ward. This reading of § 7422(d) is supported by the subsec-
tion heading, “Credit treated as payment.”
The difference in the text of §§ 6513(b)(2) and 7422(d)
supports this interpretation. Section 7422(d) uses the lan-
guage, “be deemed to be a payment,” while § 6513(b)(2) uses
the language, “be deemed to have been paid on.” Section
6513(b)(2) establishes a “deemed paid date” for purposes of
§ 6511, while § 7422(d) simply establishes that an allowed
credit is deemed to be a payment of the tax liability for pur-
poses of a suit for a refund.
The Fifth Circuit assists us in understanding the interaction
between §§ 6513 and 7422 and their applicability. See Har-
rigill, 410 F.3d 786. In Harrigill, Harrigill overpaid her 1994
taxes but did not file timely tax returns for 1994 or 1995. Id.
at 787-88. She did, however, file the necessary applications
for a six-month extension for her 1994 and 1995 tax returns.
Id. She filed her 1994 tax return on September 18, 1998,
approximately three years and five months after the ordinary
due date for a 1994 tax return. Id. at 787. In her 1994 tax
return, she indicated that the 1994 overpayment should be
applied to her estimated tax for 1995. Id. The IRS allowed the
credit (which was not challenged), presumably because the
claim for credit was made within the look-back period
9926 REYNOSO v. UNITED STATES
allowed in § 6511(b)(2)(A) (three years and six months in that
case). See id. at 787-88.
Subsequently, in Harrigill’s 1995 tax return (filed on
December 4, 2000), she applied the 1995 overpayment to her
1996 estimated taxes. Id. at 788. The IRS denied the request
citing § 6511(b)(2)(A). Id. Harrigill held the claim for credit
untimely, because the 1994 overpayment applied to the 1995
tax year was deemed paid for purposes of § 6511(b)(2)(A) on
the due date for the 1995 tax return—i.e., April 15, 1996.5 Id.
at 792. Notably, Harrigill did not deem the payment made the
date the credit was allowed. See id. at 789-92.
[9] Based on Harrigill and based on a plain reading of
§§ 6511, 6513, and 7422, for purposes of § 6511, the date the
credit is allowed is not the date the tax is deemed paid when
a claim for credit is made against estimated tax for a succeed-
ing tax year. See Hui v. Castaneda, 130 S. Ct. 1845, 1855
(2010) (“We are required . . . to read [a] statute according to
its text. . . .”). Instead, § 6513 governs what constitutes the
payment date of payments for estimated tax and credits
toward estimated tax for a succeeding year. I.R.C.
§ 6513(b)(2), (d); see also Baral, 528 U.S. at 435-36.
Moreover, even if § 7422(d)’s language (that a credit of an
overpayment is “deemed to be a payment” at the time the
credit is allowed) is somehow read as establishing a “deemed
paid date” when the credit is allowed, Reynoso’s credit was
time-barred from being allowed in the first place. Thus, the
IRS lacked authority to effectuate the credit. In fact, § 7422(a)
provides that “[n]o suit or proceeding shall be maintained in
any court for the recovery of any [overpayment] . . . until a
claim for refund or credit has been duly filed with the Secre-
5
Section § 6513(d) would apply to designate the deemed paid date,
because the taxpayer in Harrigill made the claim for credit within
§ 6511(b)(2)(A)’s look-back period (based on a deemed paid date under
§ 6513(b)(2)).
REYNOSO v. UNITED STATES 9927
tary, according to the provisions of law in that regard, and the
regulations of the Secretary established in pursuance thereof.”
Accord Treas. Reg. § 301.6402-2(a)(1) (“[U]nder section
7422, a civil action for refund may not be instituted unless a
claim has been filed within the properly applicable period of
limitation.”).
“Section 6402 governs the circumstances in which an over-
payment in one year may be treated as a payment of tax for
the succeeding year . . . .” Burr, T.C. Memo 2002-69, at *3.
“[S]ection 6402 and the regulations thereunder condition this
treatment on a claim for a credit of the preceding year’s over-
payment that is made within the applicable period of limita-
tions.” Id. “Accordingly, under section 6402, [the IRS] did
not have authority to award [Reynoso the $117,527] credit
. . . .” See id.
[10] In sum, based on the distinction between §§ 6513 and
7422,6 § 7422(d) does not save Reynoso’s claim for the
$117,527 overpayment from being time-barred. Reynoso
sought to credit the $117,527 overpayment against his esti-
mated 2000 tax liability. Therefore, § 6513(b) applies in
determining when the overpayments were deemed paid for
purposes of § 6511(b)(2)(A). Specifically, § 6513(b)(2)
deems Reynoso’s payments “paid” on April 15, 2000, in order
to determine if Reynoso claimed a credit within the
§ 6511(b)(2)(A) look-back period. Under the look-back
period (three years plus any allowed extension time), Reyno-
so’s claim for credit was time-barred.
6
Our distinction between §§ 6513 and 7422 exists based on a textual
reading and allows each section to exist without conflict. See Arkansas v.
Farm Credit Servs. of Cent. Ark., 520 U.S. 821, 827 (1997) (noting that
it is a “basic principle that statutory language is to be enforced according
to its terms”); La. Pub. Serv. Comm’n v. F.C.C., 476 U.S. 355, 370 (1986)
(“[W]here possible, provisions of a statute should be read so as not to
create a conflict.”).
9928 REYNOSO v. UNITED STATES
3. The Limitations of § 6511 Cannot Be Waived and a
Credit Made In Violation of § 6511(b)(2)(A) Cannot
Support A Subsequent Claim of Refund
Reynoso next argues that, even if the IRS lacked authority,
the credit transfer cannot be ignored, because (1) the Govern-
ment and taxpayers are held to the same standard; (2) the
Government’s act of making the transfer waives any alleged
lack of authority; and (3) case law supports not ignoring the
credit transfer. We disagree.
[11] Reynoso’s first and second arguments for why the
credit transfer cannot be ignored fail, because the filing of a
timely refund claim is jurisdictional and cannot be waived. N.
Life Ins. Co. v. United States, 685 F.2d 277, 279 (9th Cir.
1982); see Ertman v. United States, 165 F.3d 204, 206 (2d
Cir. 1999). Specifically, § 6511(b)(2)(A) is jurisdictional in
nature and cannot be waived. Zeier v. U.S. I.R.S., 80 F.3d
1360, 1364 (9th Cir. 1996). In Northern Life, the IRS exe-
cuted an agreement with the taxpayer to extend the time the
taxpayer could claim a refund. 685 F.2d at 279. The taxpayer
argued that “the IRS either waived the statute of limitations
or [was] estopped from asserting it.” Id. We rejected the
waiver argument, holding that “[t]he filing of a timely claim
is jurisdictional for a refund suit and cannot be waived.” Id.
[12] Similar to Northern Life, this case involves the IRS
acting contrary to the Code’s specific requirements. The IRS
allowed Reynoso’s claim for credit even though the Code
expressly prohibited the credit. Therefore, in this case, the
IRS’s mistaken allowance of Reynoso’s credit does not vali-
date the credit and allow Reynoso to rely on § 7422(d) to
assert that the claimed credit was somehow timely. Reynoso
cannot use a time-barred tax credit to validate a subsequent,
and otherwise time-barred, claim for refund.7
7
Reynoso “concedes that recovery would be barred by section 6511 if
the transfer never occurred.”
REYNOSO v. UNITED STATES 9929
Moreover, the Supreme Court has explicitly stated that
courts are not to create equitable exceptions to the limitations
in § 6511. United States v. Brockamp, 519 U.S. 347, 352
(1997). Thus, Reynoso should not receive special exception to
§ 6511’s limitations based on equitable principles.
[13] Lastly, Reynoso argues that the mistaken credit can-
not be ignored, because cases have held that an erroneous
refund or credit reduces a taxpayer’s liability. The cases cited
stand for the proposition that an erroneous refund or credit
does not revive a previously extinguished tax liability. See,
e.g., Bilzerian v. United States, 86 F.3d 1067, 1069 (11th Cir.
1996) (per curiam); O’Bryant v. United States, 49 F.3d 340,
346-47 (7th Cir. 1995); Kelley v. United States, 30 F.2d 193
(9th Cir. 1929). In other words, the IRS may not ignore a tax
payment that extinguishes a tax liability simply because the
IRS subsequently makes an erroneous refund. In the cases
cited by Reynoso, the courts have not held that erroneous
refunds are uncollectible, but rather that the IRS must use the
erroneous refund procedures to collect. See, e.g., O’Bryant, 49
F.3d at 346-47. Even assuming Reynoso correctly interprets
these cases as standing for the proposition that an erroneous
credit cannot be ignored, none of the cases involved an erro-
neous refund or credit made after the statute of limitations had
run. Thus, none of the cases held that the jurisdictional
requirement of a timely claim could be waived by a mistake.
IV. CONCLUSION
[14] Because Reynoso overpaid his 1999 taxes well out-
side of § 6511(b)(2)(A)’s look-back period, his claim for
credit was barred. Thus, Reynoso’s subsequent claim for
refund based on the barred claimed credit was invalid and
uncollectible.
AFFIRMED.