Cases: Umland v. PLANCO Financial Services, Inc., 542 F.3d 59 (3rd Cir. 2008)
Final rules 1
(a) No suit prior to filing claim for refund No suit or proceeding shall be maintained in any court for the recovery of any internal revenue tax alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected without authority, or of any sum alleged to have been excessive or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with the Secretary, according to the provisions of law in that regard, and the regulations of the Secretary established in pursuance thereof.
Amended 1976
- 1976 Pub. L. 94-455 Pub. L. 94–455, § 1906(b)(13)(A), struck out “or his delegate” after “Secretary”.
Cases: United States v. Williams, 514 U.S. 527 (1995); United States v. Clintwood Elkhorn Mining Co., 553 U.S. 1 (2008)
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(b) Protest or duress Such suit or proceeding may be maintained whether or not such tax, penalty, or sum has been paid under protest or duress.
(c) Suits against collection officer a bar A suit against any officer or employee of the United States (or former officer or employee) or his personal representative for the recovery of any internal revenue tax alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected without authority, or of any sum alleged to have been excessive or in any manner wrongfully collected shall be treated as if the United States had been a party to such suit in applying the doctrine of res judicata in all suits in respect of any internal revenue tax, and in all proceedings in the Tax Court and on review of decisions of the Tax Court.
Amended 1976
- 1976 Pub. L. 94-455 Pub. L. 94–455, § 1906(a)(44), struck out “instituted after June 15, 1942,” after “res judicata in all suits” and “where the petition to the Tax Court was filed after such date” after “decisions of the Tax Court”.
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(d) Credit treated as payment The credit of an overpayment of any tax in satisfaction of any tax liability shall, for the purpose of any suit for refund of such tax liability so satisfied, be deemed to be a payment in respect of such tax liability at the time such credit is allowed.
(e) Stay of proceedings If the Secretary prior to the hearing of a suit brought by a taxpayer in a district court or the United States Court of Federal Claims for the recovery of any income tax, estate tax, gift tax, or tax imposed by chapter 41, 42, 43, or 44 (or any penalty relating to such taxes) mails to the taxpayer a notice that a deficiency has been determined in respect of the tax which is the subject matter of taxpayer’s suit, the proceedings in taxpayer’s suit shall be stayed during the period of time in which the taxpayer may file a petition with the Tax Court for a redetermination of the asserted deficiency, and for 60 days thereafter. If the taxpayer files a petition with the Tax Court, the district court or the United States Court of Federal Claims, as the case may be, shall lose jurisdiction of taxpayer’s suit to whatever extent jurisdiction is acquired by the Tax Court of the subject matter of taxpayer’s suit for refund. If the taxpayer does not file a petition with the Tax Court for a redetermination of the asserted deficiency, the United States may counterclaim in the taxpayer’s suit, or intervene in the event of a suit as described in subsection (c) (relating to suits against officers or employees of the United States), within the period of the stay of proceedings notwithstanding that the time for such pleading may have otherwise expired. The taxpayer shall have the burden of proof with respect to the issues raised by such counterclaim or intervention of the United States except as to the issue of whether the taxpayer has been guilty of fraud with intent to evade tax. This subsection shall not apply to a suit by a taxpayer which, prior to the date of enactment of this title, is commenced, instituted, or pending in a district court or the United States Court of Federal Claims for the recovery of any income tax, estate tax, or gift tax (or any penalty relating to such taxes).
Amended 1969, 1974, 1976, 1980, 1982, 1988, 2018
- 2018 Pub. L. 115-141 Pub. L. 115–141 substituted “United States Court of Federal Claims” for “United States Claims Court” wherever appearing.
- 1988 Pub. L. 100-418 Pub. L. 100–418 substituted “or 44” for “44, or 45”.
- 1982 Pub. L. 97-164 Pub. L. 97–164 substituted “United States Claims Court” for “Court of Claims” wherever appearing.
- 1980 Pub. L. 96-223 Pub. L. 96–223 inserted reference to chapter 45.
- 1976 Pub. L. 94-455 Pub. L. 94–455, §§ 1307(d)(2)(F)(viii), 1605(b)(11), 1906(b)(13)(A), struck out “or his delegate” after “Secretary” and substituted “chapter 41, 42,” for “chapter 42” and “43, or 44” for “or 43”.
- 1974 Pub. L. 93-406 Pub. L. 93–406, § 1016(a)(26)(A), substituted “chapter 42 or 43” for “chapter 42”.
- 1969 Pub. L. 91-172 Pub. L. 91–172, § 101(j)(56), inserted reference to chapter 42 taxes.
(f) Limitation on right of action for refund
Amended 1966
- 1966 Pub. L. 89-713 Pub. L. 89–713 added subsec. (f) and redesignated former subsec. (f) as (g).
(1) General rule A suit or proceeding referred to in subsection (a) may be maintained only against the United States and not against any officer or employee of the United States (or former officer or employee) or his personal representative. Such suit or proceeding may be maintained against the United States notwithstanding the provisions of section 2502 of title 28 of the United States Code (relating to aliens’ privilege to sue) and notwithstanding the provisions of section 1502 of such title 28 (relating to certain treaty cases).
Amended 1971
- 1971 Pub. L. 92-178 Pub. L. 92–178 authorized maintenance of suit or proceeding against the United States notwithstanding provisions of section 1502 of Title 28 (relating to certain treaty cases).
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(2) Misjoinder and change of venue If a suit or proceeding brought in a United States district court against an officer or employee of the United States (or former officer or employee) or his personal representative is improperly brought solely by virtue of paragraph (1), the court shall order, upon such terms as are just, that the pleadings be amended to substitute the United States as a party for such officer or employee as of the time such action commenced, upon proper service of process on the United States. Such suit or proceeding shall upon request by the United States be transferred to the district or division where it should have been brought if such action initially had been brought against the United States.
Amended 1958
- 1958 Pub. L. 85-866 Pub. L. 85–866 struck out “district” before “attorneys”.
(g) Special rules for certain excise taxes imposed by chapter 42 or 43
Amended 1966, 1969, 1974, 1980
- 1980 Pub. L. 96-596 Pub. L. 96–596 substituted in par. (1) provision authorizing, with respect to any taxable event, payment of the full amount of the first tier tax as constituting sufficient payment in order to maintain an action under this section with respect to the second tier tax and defining the terms “taxable event”, “first tier tax”, and “second tier tax” as having the respective meanings given to such terms by section 4962 of this title for provision authorizing, with respect to any act or failure to act giving rise to liability under sections 4941, 4942, 4943, 4944, 4945, 4951, 4952, 4971, or 4975 of this title, payment of the full amount of tax imposed under specified subsections of those sections as constituting sufficient payment in order to maintain an action under this section with respect to such act or failure to act.
- 1980 Pub. L. 96-222 Pub. L. 96–222 substituted in pars. (1) to (3) “4944, 4945, 4951, 4952” for “4944, 4945” and in par. (1) “section 4945(a) (relating to initial taxes on taxable expenditures), section 4951(a) (relating to initial taxes on self dealing), 4952(a) (relating to initial taxes on taxable expenditures)” for “section 4945(a) (relating to initial taxes on taxable expenditures)” and “section 4945(b) (relating to additional taxes on taxable expenditures), section 4951(b) (relating to additional taxes on self-dealing), 4952(b) (relating to additional taxes on taxable expenditures)” for “section 4945(b) (relating to additional taxes on taxable expenditures)”.
- 1974 Pub. L. 93-406 Pub. L. 93–406, § 1016(a)(26)(B)–(F), substituted “chapter 42 or 43” for “chapter 42” in heading, substituted “4945, 4971, or 4975” for “or 4945”, “section 4945(a) (relating to initial taxes on taxable expenditures), 4971(a) (relating to initial tax on failure to meet minimum funding standard), 4975(a) (relating to initial tax on prohibited transactions)” for “section 4945(a) (relating to initial taxes on taxable expenditures)”, and “section 4945(b) (relating to additional taxes on taxable expenditures), section 4971(b) (relating to additional tax on failure to meet minimum funding standard), or section 4975(b) (relating to additional tax on prohibited transactions)” for “or section 4945(b) (relating to additional taxes on taxable expenditures)” in par. (1), and substituted “4945, 4971, or 4975” for “or 4945” in pars. (2) and (3).
- 1969 Pub. L. 91-172 Pub. L. 91–172, § 101(i), added subsec. (g) and redesignated former subsec. (g) as (h).
- 1966 Pub. L. 89-713 Pub. L. 89–713 added subsec. (f) and redesignated former subsec. (f) as (g).
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(1) Right to bring actions
(A) In general With respect to any taxable event, payment of the full amount of the first tier tax shall constitute sufficient payment in order to maintain an action under this section with respect to the second tier tax.
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(B) Definitions For purposes of subparagraph (A), the terms “taxable event”, “first tier tax”, and “second tier tax” have the respective meanings given to such terms by section 4963.
Amended 1986
- 1986 Pub. L. 99-514 Pub. L. 99–514 substituted “section 4963” for “section 4962”.
(2) Limitation on suit for refund No suit may be maintained under this section for the credit or refund of any tax imposed under section 4941, 4942, 4943, 4944, 4945, 4951, 4952, 4955, 4958, 4971, or 4975 with respect to any act (or failure to act) giving rise to liability for tax under such sections, unless no other suit has been maintained for credit or refund of, and no petition has been filed in the Tax Court with respect to a deficiency in, any other tax imposed by such sections with respect to such act (or failure to act).
Amended 1987, 1996
- 1996 Pub. L. 104-168 Pub. L. 104–168 inserted “4958,” after “4955,”.
- 1987 Pub. L. 100-203 Pub. L. 100–203 inserted “4955,” after “4952,”.
(3) Final determination of issues For purposes of this section, any suit for the credit or refund of any tax imposed under section 4941, 4942, 4943, 4944, 4945, 4951, 4952, 4955, 4958, 4971, or 4975 with respect to any act (or failure to act) giving rise to liability for tax under such sections, shall constitute a suit to determine all questions with respect to any other tax imposed with respect to such act (or failure to act) under such sections, and failure by the parties to such suit to bring any such question before the Court shall constitute a bar to such question.
Amended 1987, 1996
- 1996 Pub. L. 104-168 Pub. L. 104–168 inserted “4958,” after “4955,”.
- 1987 Pub. L. 100-203 Pub. L. 100–203 inserted “4955,” after “4952,”.
[(h) Repealed. Pub. L. 114–74, title XI, § 1101(f)(11), Nov. 2, 2015, 129 Stat. 638]
Amended 1969, 1982, 1984, 2015
- 2015 Pub. L. 114-74 Pub. L. 114–74 struck out subsec. (h). Text read as follows: “No action may be brought for a refund attributable to partnership items (as defined in section 6231(a)(3)) except as provided in section 6228(b) or section 6230(c).”
- 1984 Pub. L. 98-369 Pub. L. 98–369, § 714(p)(2)(H), substituted “section 6231(a)(3)” for “section 6131(a)(3)”.
- 1982 Pub. L. 97-248 Pub. L. 97–248 added subsec. (h) and redesignated former subsec. (h) as (i).
- 1969 Pub. L. 91-172 Pub. L. 91–172, § 101(i), added subsec. (g) and redesignated former subsec. (g) as (h).
(i) Special rule for actions with respect to tax shelter promoter and understatement penalties No action or proceeding may be brought in the United States Court of Federal Claims for any refund or credit of a penalty imposed by section 6700 (relating to penalty for promoting abusive tax shelters, etc.) or section 6701 (relating to penalties for aiding and abetting understatement of tax liability).
Amended 1982, 1984, 2018
- 2018 Pub. L. 115-141 Pub. L. 115–141 substituted “United States Court of Federal Claims” for “United States Claims Court” wherever appearing.
- 1984 Pub. L. 98-369 Pub. L. 98–369, § 714(g)(1), added subsec. (i) and redesignated former subsec. (i) as (j).
- 1982 Pub. L. 97-248 Pub. L. 97–248 added subsec. (h) and redesignated former subsec. (h) as (i).
(j) Special rule for actions with respect to estates for which an election under section 6166 is made
Amended 1984, 1998
- 1998 Pub. L. 105-206 Pub. L. 105–206 added subsec. (j) and redesignated former subsec. (j) as (k).
- 1984 Pub. L. 98-369 Pub. L. 98–369, § 714(g)(1), added subsec. (i) and redesignated former subsec. (i) as (j).
(1) In general The district courts of the United States and the United States Court of Federal Claims shall not fail to have jurisdiction over any action brought by the representative of an estate to which this subsection applies to determine the correct amount of the estate tax liability of such estate (or for any refund with respect thereto) solely because the full amount of such liability has not been paid by reason of an election under section 6166 with respect to such estate.
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(2) Estates to which subsection applies This subsection shall apply to any estate if, as of the date the action is filed—
(A) no portion of the installments payable under section 6166 have been accelerated;
(B) all such installments the due date for which is on or before the date the action is filed have been paid;
(C) there is no case pending in the Tax Court with respect to the tax imposed by section 2001 on the estate and, if a notice of deficiency under section 6212 with respect to such tax has been issued, the time for filing a petition with the Tax Court with respect to such notice has expired; and
(D) no proceeding for declaratory judgment under section 7479 is pending.
(3) Prohibition on collection of disallowed liability If the court redetermines under paragraph (1) the estate tax liability of an estate, no part of such liability which is disallowed by a decision of such court which has become final may be collected by the Secretary, and amounts paid in excess of the installments determined by the court as currently due and payable shall be refunded.
(k) Cross references
Amended 1998
- 1998 Pub. L. 105-206 Pub. L. 105–206 added subsec. (j) and redesignated former subsec. (j) as (k).
(1) For provisions relating generally to claims for refund or credit, see chapter 65 (relating to abatements, credit, and refund) and chapter 66 (relating to limitations).
(2) For duty of United States attorneys to defend suits, see section 507 of Title 28 of the United States Code.
(3) For jurisdiction of United States district courts, see section 1346 of Title 28 of the United States Code.
(4) For payment by the Treasury of judgments against internal revenue officers or employees, upon certificate of probable cause, see section 2006 of Title 28 of the United States Code.