Baral v. U.S., 981667
| Court | United States Supreme Court |
| Writing for the Court | Thomas |
| Citation | 145 L.Ed.2d 949,528 U.S. 431,120 S.Ct. 1006 |
| Parties | Syllabus NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U.S. 321, 337. SUPREME COURT OF THE UNITED STATES BARAL v. UNITED STATES CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT1667 |
| Docket Number | 981667 |
| Decision Date | 22 February 2000 |
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U.S. 321, 337.
SUPREME COURT OF THE UNITED STATES
BARAL
v.
UNITED STATES
CERTIORARI TO THE UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued January 18, 2000
Decided February 22, 2000
Two remittances were made to the Internal Revenue Service toward petitioner Baral's income tax liability for the 1988 tax year: a withholding of $4,104 from Baral's wages throughout 1988 by his employer, and an estimated income tax of $1,100 remitted in January 1989 by Baral. Baral's income tax return for 1988 was due on April 15, 1989. Though he received an extension until August 15, he missed this deadline and did not file the return until June 1, 1993. On the return, he claimed a $1,175 overpayment and asked the Service to apply this excess as a credit toward his outstanding tax obligations for the 1989 tax year. The Service denied the requested credit, concluding that the claim exceeded the ceiling imposed by 26 U.S.C. § 6511(b)(2)(A), which states that "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." Since Baral filed his return on June 1, 1993, and received a 4-month extension from the initial due date, the relevant look-back period under §6511(b)(2)(A) extended from June 1, 1993, back to February 1, 1990 (i.e., three years plus four months). According to the Service, Baral had paid no portion of the overpaid tax during that period, and so faced a ceiling of zero on any allowable refund or credit. Baral commenced this suit for refund in the Federal District Court, which granted the Service summary judgment. The Court of Appeals affirmed, concluding that both remittances were "paid" on April 15, 1989.
Held: Remittances of estimated income tax and withholding tax are "paid" on the due date of a calendar year taxpayer's income tax return. Sections 6513(b)(1) and (2) unequivocally provide that the two remittances were "paid" on April 15, 1989, for purposes of §6511(b)(2)(A), so that they precede the look-back period, which began on February 1, 1990. Subsection (1) resolves when the remittance of Baral's employer's withholding tax was "paid," and subsection (2) determines when his remittance of estimated income tax was "paid." Because neither these remittances nor any others were "paid" within the look-back period, the ceiling on Baral's requested $1,175 credit is zero, and the Service was correct to deny that credit. Contrary to Baral's claim, the withholding tax and estimated tax are not taxes in their own right (separate from the income tax), that are converted into income tax only on the income tax return. Rather, they are methods for collecting income taxes. And the Tax Code directly contradicts Baral's notion that income tax is "paid" under §6511(b)(2)(A) only when the income tax is assessed. See §6151(a). His position also finds no support in Rosenman v. United States, 323 U.S. 658, and would work to the detriment of timely taxpayers, who would be denied interest for the time between filing a return claiming a refund or credit and the Service's assessment. Pp. 3 9.
172 F.3d 918, affirmed.
SUPREME COURT OF THE UNITED STATES
DAVID H. BARAL, PETITIONER
v.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
February 22, 2000
Internal Revenue Code §6511(b)(2)(A) imposes a ceiling on the amount of credit or refund to which a taxpayer is entitled as compensation for an overpayment of tax: "[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." 26 U.S.C. § 6511(b)(2)(A). We are called upon in this case to decide when two types of remittance are "paid" for purposes of this section: a remittance by a taxpayer of estimated income tax, and a remittance by a taxpayer's employer of withholding tax. The plain language of a nearby Code section, §6513(b), provides the answer: These remittances are "paid" on the due date of the taxpayer's income tax return. I
The relevant facts are not disputed. Two remittances were made to the Internal Revenue Service toward petitioner David H. Baral's income tax liability for the 1988 tax year. The first, a withholding of $4,104 from Baral's wages throughout 1988, was a garden-variety collection of income tax by the employer, see §3402. The second, an estimated income tax of $1,100 remitted in January 1989, was sent by Baral himself out of concern that his employer's withholding might be inadequate to meet his tax obligation for the year, see §6654. In the ordinary course, Baral's income tax return for 1988 was due to be filed on April 15, 1989. Though he applied for and received an extension of time until August 15, Baral missed this deadline; he did not file the return until nearly four years later, on June 1, 1993. The Service, on July 19, 1993, assessed the tax liability reported on this belated return.
On the return, Baral claimed that he (and his employer on his behalf) had remitted $1,175 more with respect to the 1988 taxable year than he actually owed. Baral requested that the Service apply this excess as a credit toward his outstanding tax obligations for the 1989 taxable year. The Service denied the requested credit. It did not dispute that Baral had timely filed the request under the relevant filing deadline "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." §6511(a); see §6511(b)(1). But the Service concluded that the claim exceeded the ceiling imposed by §6511(b)(2)(A). That provision states that "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." Ibid.; see generally Commissioner v. Lundy, 516 U.S. 235, 240 (1996) (). Since Baral had filed his return on June 1, 1993, and had earlier received a 4-month extension from the initial due date, the relevant look-back period under §6511(b)(2)(A) extended from June 1, 1993, back to February 1, 1990 (i.e., three years plus four months). According to the Service, Baral had paid no portion of the overpaid tax during that period, and so faced a ceiling of zero on any allowable refund or credit.
Baral then commenced the instant suit for refund in Federal District Court. That court sustained the Service's position and granted summary judgment in its favor. The Court of Appeals affirmed. App. to Pet. for Cert. A 1, judgt. order reported at 172 F.3d 918 (CADC 1999). The Court of Appeals looked to §6513(b)(1), which states that amounts of tax withheld from wages "shall be deemed to have been paid by [the taxpayer] on the 15th day of the fourth month following the close of his taxable year," and to §6513(b)(2), which makes similar provision for amounts submitted as estimated income tax, and concluded that, under these subsections, both of the remittances at issue were "paid" on April 15, 1989. Accord, e.g., Dantzler v. United States, 183 F.3d 1247, 1250 1251 (CA11 1999) (estimated income tax); Ertman v. United States, 165 F.3d 204, 207 (CA2 1999) (same); Ehle v. United States, 720 F.2d 1096, 1096 1097 (CA9 1983) (withholding from wages). In view of apparent tension between this approach and a decision of the Court of Appeals for the Fifth Circuit, Ford v. United States, 618 F.2d 357, 360 361, and n. 4 (1980) ( that a remittance respecting any sort of tax is "paid" under §6511 only when the Service assesses the tax liability), we granted certiorari, 527 U.S. 1067 (1999).
II
The parties renew before us the contentions advanced below. The Government submits that §§6513(b)(1) and (2) unequivocally provide that the two remittances at issue were "paid" on April 15, 1989 for purposes of §6511(b)(2)(A), so that they precede the look-back period, which, as noted, commenced on February 1, 1990. Baral, on the other hand, urges that a tax cannot be "paid" within the meaning of §6511(b)(2)(A) until the tax liability is assessed (i.e., the value of the liability is definitively fixed). According to Baral, the requisite assessment might be made either when the taxpayer files his return (here June 1, 1993) or when the Service, under §6201, formally assesses the liability (here July 19, 1993), though he seems to prefer the latter date. See Brief for Petitioner 9 ("Payment of the income tax occurred at the earliest on June 1, 1993, when the amount of that tax first became known, and more precisely on July 19, 1993, when the...
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