Boechler, P.C. v. Comm'r of Internal Revenue

• Decision Date: 24 July 2020
• Docket Number: No. 19-2003,19-2003
• Citation: 967 F.3d 760
• Parties: BOECHLER, P.C., Appellant v. COMMISSIONER OF INTERNAL REVENUE, Appellee The Federal Tax Clinic of the Legal Services Center of Harvard Law School, Amicus on Behalf of Appellant(s)
• Court: U.S. Court of Appeals — Eighth Circuit

967 F.3d 760

BOECHLER, P.C., Appellant

v. COMMISSIONER OF INTERNAL REVENUE, AppelleeThe Federal Tax Clinic of the Legal Services Center of Harvard Law School, Amicus on Behalf of Appellant(s)

No. 19-2003

United States Court of Appeals, Eighth Circuit.

Submitted: June 17, 2020

Filed: July 24, 2020

Amy M. Feinberg, LATHAM & WATKINS, Washington, DC, David Clark Thompson, DAVID C. THOMPSON, P.C., Grand Forks, ND, for Appellant.

Janet A. Bradley, Joan I. Oppenheimer, Gilbert Steven Rothenberg, Senior Attorney, U.S. DEPARTMENT OF JUSTICE, Tax Division, Appellate Section, Washington, DC, Michael J. Desmond, U.S. INTERNAL REVENUE SERVICE, Office of Chief Counsel, Washington, DC, Timothy M. Peel, John C. Schmittdiel, U.S. INTERNAL REVENUE SERVICE, Office of Chief Counsel, Saint Paul, MN, for Appellee.

Keith Fogg, HARVARD LAW SCHOOL, Federal Tax Clinic at Legal Services Center, Jamaica Plain, MA, Carlton M. Smith, LAW OFFICE OF CARLTON M. SMITH, New York, NY, for Amicus on Behalf of Appellant(s) The Federal Tax Clinic of the Legal Services Center of Harvard Law School.

Before KELLY, ERICKSON, and STRAS, Circuit Judges.

ERICKSON, Circuit Judge.

Boechler, P.C. ("Boechler") filed a petition for review of a notice of determination from the Commissioner of Internal Revenue ("IRS"). Under 26 U.S.C. § 6330(d)(1), a party has 30 days to file a petition for review. Boechler filed one day after the filing deadline had passed. The tax court¹ dismissed the petition on the ground that it lacked jurisdiction because the petition was untimely. We have jurisdiction under 26 U.S.C. § 7842 and we affirm.

I. Background

On June 5, 2015, the IRS sent Boechler a letter noting a discrepancy between prior tax document submissions. The IRS did not receive a response and imposed a 10% intentional disregard penalty. Boechler did not pay the penalty. The IRS mailed Boechler a notice of intent to levy. Boechler timely requested a Collection Due Process ("CDP") hearing but failed to establish grounds for relief on the discrepancy or the unpaid penalty. On July 28, 2017, the Office of Appeals mailed a determination sustaining the levy to Boechler's last known address in Fargo, North Dakota. The notice of determination, delivered on July 31, stated that Boechler had 30 days from the date of determination, i.e. until August 28, 2017, to submit a petition for a CDP hearing.

Boechler mailed a petition for a CDP hearing on August 29, 2017, one day after the 30-day filing deadline had expired. The United States Tax Court received Boechler's untimely petition and the IRS moved to dismiss for lack of jurisdiction. Boechler objected, arguing that the 30-day time limit in 26 U.S.C. § 6330(d)(1) is not jurisdictional, the time limit should be equitably tolled, and calculating the time limit from issuance rather than receipt violates due process. The tax court dismissed the petition for lack of jurisdiction. Boechler appealed.

II. Discussion

We review questions of the tax court's subject matter jurisdiction de novo . Martin S. Azarian, P.A. v. Comm'r, 897 F.3d 943, 944 (8th Cir. 2018). The tax court is an Article I court and as such it is a court with "strictly limited jurisdiction." Bartman v. C.I.R., 446 F.3d 785, 787 (8th Cir. 2006) (quoting Kelley v. Comm'r, 45 F.3d 348, 351 (9th Cir. 1995) ). The Supreme Court has "repeatedly held that filing deadlines ordinarily are not jurisdictional" but instead are usually "quintessential claim-processing rules." Sebelius v. Auburn Reg. Med. Ctr., 568 U.S. 145, 154, 133 S.Ct. 817, 184 L.Ed.2d 627 (2013) (internal quotation marks omitted). That said, a rule that "governs a court's adjudicatory capacity" is jurisdictional and "[o]ther rules, even if important or mandatory ... should not be given the jurisdictional brand." Henderson ex rel. Henderson v. Shinseki, 562 U.S. 428, 435, 131 S.Ct. 1197, 179 L.Ed.2d 159 (2011).

We address first the threshold issue of whether the 30-day time limit in 26 U.S.C. § 6330(d)(1) is jurisdictional. The statute provides:

The 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).

A few years ago, this court considered § 6330 in the context of whether the tax court's jurisdiction over original notices of determination extended to supplemental notices. Hauptman v. C.I.R., 831 F.3d 950, 952–53 (8th Cir. 2016). In Hauptman, the panel identified two prerequisites for jurisdiction over an initial notice of determination: (1) the issuance of a notice of determination following a CDP hearing, and (2) the taxpayer's filing of a petition challenging that determination within 30 days of the issuance date. Id. at 953 (citing Gillum v. Comm'r, 676 F.3d 633, 647 (8th Cir. 2012) ; Gray v. Comm'r, 723 F.3d 790, 793 (7th Cir. 2013) ); see Tschida v. C.I.R., 57 F. App'x. 715, 715–16 (8th Cir. 2003) (per curiam) (unreported) (holding that the failure to comply with § 6330(d)(1) deprived the tax court of jurisdiction). Because neither of these factors were at issue in Hauptman the court rejected the argument that the tax court lacked jurisdiction to review supplemental notices. Hauptman, 831 F.3d at 953.

Although the IRS argues that we are bound by Hauptman and required to find § 6330(d)(1) jurisdictional, Hauptman simply did not address jurisdictional issues raised by an untimely filing of a petition. Instead, the gravamen of the holding was limited to the question of whether the tax court's jurisdiction extended to supplemental notices of determination. While persuasive, the jurisdictional test laid out in Hauptman was obiter dicta addressing an issue not before the court. See Sanzone v. Mercy Health, 954 F.3d 1031, 1039 (8th Cir. 2020) ("Dicta is a judicial comment made while delivering a judicial opinion, but one that is unnecessary to the decision in the case and therefore not precedential.") (cleaned up). As we are not bound by the dicta of another panel, we must determine if the filing deadline in § 6330(d)(1) is jurisdictional. See id.

As a general principle, a statutory time limit is jurisdictional when Congress clearly states that it is. Musacchio v. United States, ––– U.S. ––––, 136 S. Ct. 709, 717, 193 L.Ed.2d 639 (2016). Mere proximity to a jurisdictional provision is insufficient. See Sebelius, 568 U.S. at 155–56, 133 S.Ct. 817 (stating that an otherwise non-jurisdictional provision does not become jurisdictional "simply because it is placed in a section of a statute that also contains jurisdictional provisions"). "Congress must do something special, beyond setting an exception-free deadline, to tag a [time limit] as jurisdictional and so prohibit a court from tolling it." United States v. Kwai Fun Wong, 575 U.S. 402, 410, 135 S.Ct. 1625, 191 L.Ed.2d 533 (2015). Even so, Congress does not have to "incant magic words" to make a deadline jurisdictional if the "traditional tools of statutory construction ... plainly show that Congress imbued a procedural bar with jurisdictional consequences." Id. We determine whether Congress made the necessary clear statement by examining "the text, context, and relevant historical treatment of the provision at issue." Musacchio, 136 S. Ct. at 717 (internal quotation marks omitted).

Boechler, relying on Myers v. Commissioner, asserts § 6330(d)(1) is non-jurisdictional. See 928 F.3d 1025 (D.C. Cir. 2019). In Myers, the D.C. Circuit examined whether an untimely filing under 26 U.S.C. § 7623(b)(4), which includes an identically worded parenthetical as the one found in § 6330, deprived the tax court of jurisdiction.² Id. at 1033–36. The Myers court noted that § 7623(b)(4) "comes closer to satisfying the clear statement requirement than any the Supreme Court has heretofore held to be non-jurisdictional." Myers, 928 F.3d at 1035. However, the court ultimately held that the statute did not "condition[ ] the jurisdictional grant on the limitations period, or otherwise link[ ] those separate clauses." Id. The D.C. Circuit determined that there was no clear statement that the 30-day limit in § 7623(b)(4) was jurisdictional; instead, it held that the limit was merely in close proximity to jurisdictional terms referring to the general appeal, not a timely-filed appeal. Id. at 1035.

The IRS directs our attention to the Ninth Circuit's decision in Duggan v. Commissioner, 879 F.3d 1029 (9th Cir. 2018), which held that § 6330(d)(1) is jurisdictional. In that case, the plaintiff also filed his petition for review one day after the filing deadline. Id. at 1031. The Ninth Circuit determined that § 6330(d)(1) "expressly contemplates the Tax Court's jurisdiction" and "makes timely filing of the petition a condition of the Tax Court's jurisdiction." Id. at 1034. The court explained that it was significant that "the filing deadline is given in the same breath as the grant of jurisdiction." Id. In reaching the conclusion that § 6330(d)(1) is jurisdictional, the Ninth Circuit noted "the test is whether Congress made a clear statement, not whether it made the clearest statement possible." Id.

We find the Ninth Circuit's analysis persuasive. The statutory text of § 6330(d)(1) is a rare instance where Congress clearly expressed its intent to make the filing deadline jurisdictional. The provision states: The 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). 26 U.S.C. § 6330(d)(1). The parenthetical "(and the Tax Court shall have jurisdiction with respect to such matter)" is clearly jurisdictional and renders the remainder of the sentence jurisdictional. See Fort Bend Cty. v. Davis, ––– U.S. ––––, 139 S. Ct. 1843, 1849, 204 L.Ed.2d 116 (2019).

A plain reading demonstrates that the phrase "such matter " refers to a petition to the tax court that: (1) arises from "a determination under this section" and (2) was...