Meissner v. United States

• Decision Date: 08 March 2018
• Docket Number: No. 17-928T,17-928T
• Parties: GARY D. MEISSNER and CONNIE R. MEISSNER, Plaintiffs, v. UNITED STATES, Defendant.
• Court: Court of Federal Claims

GARY D. MEISSNER and CONNIE R. MEISSNER, Plaintiffs, v. UNITED STATES, Defendant.

No. 17-928T

United States Court of Federal Claims

March 8, 2018

ORIGINAL

Tax; Motion to Dismiss; RCFC 12(b)(1)

Gary D. Meissner and Connie R. Meissner, Avondale, AZ, pro se.

Jason S. Selmont, Court of Federal Claims Section, Tax Division, United States Department of Justice, Washington, D.C. for the defendant. With him were Mary M. Abate, Assistant Chief, Court of Federal Claims Section, David I. Pincus, Chief, Court of Federal Claims Section, and Richard E. Zuckerman, Principal Deputy Assistant Attorney General, Tax Division, United States Department of Justice.

OPINION

HORN, J.

FINDINGS OF FACT

Plaintiffs, Gary and Connie Meissner, filed a pro se complaint in the United States Court of Federal Claims. Their complaint alleges that the Internal Revenue Service (IRS) owes them refunds of alleged tax overpayments totaling at least $67,931.00 for the 2014 and 2015 tax years. Plaintiffs allege that the IRS improperly calculated the amount of federal taxes plaintiffs were required to pay on their joint tax returns for both years. Plaintiffs also assert that the wages paid to them by their employers during the tax years in question were not eligible for federal taxation. Before the court is defendant's motion to dismiss plaintiffs' complaint for lack of subject matter jurisdiction. Defendant argues that because plaintiffs have failed to plead sufficient facts to establish that they filed a valid refund claim for either of the tax years for which they now seek a refund, this court should dismiss the complaint. Plaintiffs filed a response arguing that the tax Forms they submitted met all requirements in order to constitute valid claims for refund. Defendant's reply reiterated its assertions of administrative deficiencies and resulting lack of jurisdiction.

During the 2014 tax year, Mr. Meissner was employed by Rohr Inc. During that same 2014 tax year, Mrs. Meissner was employed by Southern California Permanente Medical Group. For the 2014 tax year, the IRS received W-2s for plaintiffs which indicated a combined total income of $132,907.00. Plaintiffs represent that they mailed their joint 2014 federal income tax return, a Form 1040, titled "U.S. Individual Income Tax Return," on February 5, 2015. On that return, plaintiffs included wages received in the amount of zero dollars and a total income of zero dollars. Along with their 2014 return, plaintiffs filed two Forms 4852, titled "Substitute for Form W-2, Wage and Tax Statement, or Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, insurance Contracts, etc.," both of which disputed the income listed in their employers' W-2 Forms and indicated that plaintiffs both had earned an income of zero dollars. In responding to question 9 on the Form 4852, which asks: "How did you determine the amounts on line 7 and 8 [wages and withholdings] above," plaintiffs each responded "RECORDS PROVIDED BY THE PAYER LISTED ON LINE 5." (capitalization in original). Additionally, both plaintiffs provided no response to question 10 which asks for information concerning "efforts to obtain Form W-2, Form 1099-R, or Form W-2c, Corrected Wage and Tax Statement." On both their Form 1040 and Forms 4852, plaintiffs enumerated federal income tax, Medicare, and Social Security withholdings by the federal government in the amount of $26,176.50, which they now seek be refunded.¹ Additionally, plaintiffs each attached an identical affidavit to their joint 2014 return, contesting the constitutionality of withholding federal taxes from their income.

Upon receiving plaintiffs' Forms, the IRS sent plaintiffs a letter on March 18, 2015. In this letter, the IRS requested plaintiffs provide additional information regarding the "wage or withholding entry of $26,176.95" and requested that plaintiffs submit additional documents supporting this figure. Plaintiffs responded to this letter on March 23, 2015, stating that they would not submit the additional requested forms because they believed they contained "erroneous information." Additionally, plaintiffs indicated that they believed "'taxable income'" does not encompass "'all that comes in.'"

On May 11, 2015, the IRS informed plaintiffs in a letter that the IRS had made changes to their 2014 Form 1040. These changes included subtracting the Social Security tax and Medicare tax withholdings that plaintiffs had included as part of their federal withholdings, thereby rendering plaintiffs' federal withholdings to only include federal income tax withholdings. The IRS then processed plaintiffs' 2014 return using the reported income of zero dollars. The May 11, 2015 letter stated "[a]s a result, you are due a refund of $15,623.00." On August 17, 2015, plaintiffs responded to the changes madeby the IRS to their return and reiterated that they had no taxable income and demanded that the IRS remit their total claimed refund amount of $26,176.50. Plaintiffs also pointed out that, even after this recalculation, the IRS has not sent them any funds.

This process repeated with few variations for the 2015 tax year. For that year, the IRS received W-2s for plaintiffs indicating a combined total income of $216,410.29. Plaintiffs mailed their joint 2015 federal income tax return on March 16, 2016. On that return, plaintiffs once again indicated wages in the amount of zero dollars, but reported a total income of $24.29.² As they had done the previous year, plaintiffs each filed a Form 4852 disputing the income provided by their employers' W-2 forms for tax year 2015. Plaintiffs contended that, instead, they had both earned an income of zero dollars. In responding to question 9 on his Form 4852, which asks, "How did you determine the amounts on line 7 and 8 [wages and withholdings] above," Mr. Meissner responded

After a complete review of 26 USC, the IRC [Internal Revenue Code], and case law, the erroneously allege [sic] "wages" by the payer are clearly not those described in section 3121 of part 31 of the law, nor am I their "employee' under 3401(c) of the same. [T]hese earnings are NOT based on activities of Federal privilege for which the taxes are devised (as upheld by the Supreme Court).

(emphasis added). Similarly, Mrs. Meissner, in response to the same question on her Form 4852, stated "Company provided a W-2 which erroneously alleged payments of IRC sec. 3121 and 3401 wages, hereby disputed."

With respect to question 10 on Form 4852 which, as stated above, asks for information concerning efforts to obtain documentation that can verify the amounts reported on the form, Mr. Meissner stated "[a] request for which they scoffed because they are ignorant of the laws and the IRC about 'wages' and 'income' and 'employee.' [T]heir position is reinforced by their accounting firm and their fear of the IRS retaliation." Regarding the same question, Mrs. Meissner stated "none." Along with these statements, plaintiffs reported a combined total of $26,270.73 in federal income, Social Security, and Medicare tax withholdings for tax year 2015, which they seek to have refunded.

Additionally, Mr. Meissner filed an additional Form 4852 regarding a retirement distribution of $76,923.00, which Mr. Meissner received in 2015. Instead of submitting the Form 1099-R issued to him by the administrator of his retirement plan, Mr. Meissner filed a Form 4852 on behalf of his retirement plan administrator, State Street Retiree Services for UTC Employee Savings Plan. On the form, Mr. Meissner claimed zero dollars as a gross distribution, while simultaneously reporting $15,384.62 in federal income tax withholdings. In responding to question 9 on Form 4852, which asks, "[h]ow did you determine the amounts on line 7 and 8 [wages and withholdings] above," Mr. Meissner responded "[m]onies in my savings plan came from my biweekly contributions and has no federal privileged connection[.] I was provided a 1099R which erroneously allegedpayments of IRC section 3121 and 3401 wages, hereby disputed." With respect to question 10 on Form 4852 for Mr. Meissner's retirement distribution, which, as stated above, asks for information concerning efforts to obtain documentation that can verify the amounts reported on the form, Mr. Meissner stated "I asked the payer not to deduct taxes from my monies but claimed they had to per IRS instructions." In total, plaintiffs indicate on their Form 1040 for the 2015 tax year that they are entitled to $41,755.35³ due to overpayments made during the 2015 tax year.

Along with their tax Forms for the 2015 tax year, plaintiffs included a letter indicating that they were rebutting the original W-2s that their employers had provided to the IRS. Plaintiffs' letter states, "[t]he companies erroneously alleged payments of Internal Revenue Code (IRC) sections 3121 & 3401 wages that are hereby disputed." Moreover, plaintiffs described themselves as "private sector citizens (non-federal employees) employed by private-sector companies (non-federal entity) as defined in 3401(c)(d). [Plaintiffs] are not employed in a Trade or Business' nor are [plaintiffs] 'Officers of a Corporation'. The amounts listed as withheld on the W2's and the 1099-R are correct." included with the letter were identical affidavits signed respectively by Gary D. Meissner and Connie R. Meissner stating:

TO WHOM IT MAY CONCERN: IN PARTICULAR, TO ANYONE WHO THINKS THAT HE OR SHE IS REQUIRED TO FILE AN IRS FORM W-2 OR IRS FORM 1099 ABOUT ME BUT WHO HAS NOT PAID TO ME FEDERALLY-CONNECTED MONEY FOR FEDERALLY-CONNECTED SERVICE PERFORMED BY ME OR HAS NOT PAID TO ME ANY FEDERALLY-CONNECTED BENEFIT RECEIVED BY ME.

(emphasis and capitalization in original). Plaintiffs' affidavits regarding their 2015 return filed with the IRS repeated the contentions plaintiffs' had previously made as to why they believed that the money paid to them by their employers was exempt from federal taxation. Plaintiffs stated that they "have...