Sorenson v. Secretary of Treasury of United States, 84-1686
| Decision Date | 22 April 1986 |
| Docket Number | No. 84-1686,84-1686 |
| Citation | 89 L.Ed.2d 855,106 S.Ct. 1600,475 U.S. 851 |
| Parties | Marie D. SORENSON, etc., Petitioner v. SECRETARY OF the TREASURY OF the UNITED STATES and United States |
| Court | U.S. Supreme Court |
The Internal Revenue Code (IRC) allows an individual responsible for the support of a child living with him a credit against income taxes due equal to a certain percentage of so much of earned income as does not exceed a specified amount. If the credit exceeds tax liability, the excess is considered "an overpayment" of tax under IRC § 6401(b). Section 6402(a) provides for a refund of "any overpayment" to the person who made it. Section 6402(c) requires the amount of "any overpayment" to be reduced by the amount of any past-due child-support payments assigned to a State. Section 464 of the Social Security Act (SSA) directs the Secretary of the Treasury to "intercept" tax refunds payable to persons who have failed to meet child-support obligations that have been assigned to a State. When petitioner's husband fell behind in support payments for a child of a previous marriage who was in the custody of his former wife, the latter, upon applying for welfare benefits from the State of Washington, assigned to the State, as required by the Aid to Families with Dependent Children program, her right to collect the unpaid child-support payments. Petitioner and her husband, who had their own dependent child living with them, filed a joint federal income tax return for 1981 in which all income was attributable to petitioner's wages and unemployment compensation benefits and in which they anticipated a refund based in part on an earned-income credit. The Internal Revenue Service, however, notified them that a certain amount of the anticipated refund was being retained, under the authority of the tax-intercept law, and would be paid over to the State of Washington. Petitioner then filed a class action in Federal District Court, seeking a declaration that § 464 of the SSA did not reach a refund attributable to an excess earned-income credit. The District Court granted summary judgment for the Government, and the Court of Appeals affirmed.
Held: An excess earned-income credit can properly be intercepted under the applicable statutes. Pp. 859-865.
(a) The IRC's treatment of earned-income credits supports the Government's position. The refundability of that credit is inseparable from its classification as an overpayment of tax. It is an "overpayment" not only for purposes of § 6402(a), but also for purposes of § 6402(c). Eligi- bility for an earned-income credit does not depend upon an individual's actually having paid any tax. The IRC's classification of the credit as an "overpayment" to be refunded is similarly independent of the individual's actually having made any payment. To the extent an excess credit is "payable" to an individual, it is payable as if it were a refund of tax paid. Pp. 859-863.
(b) There is no support for petitioner's claim that Congress did not intend the tax-intercept program to reach excess earned-income credits. Although Congress never mentioned the earned-income credit in enacting the Omnibus Budget Reconciliation Act of 1981, which added § 6402(c) to the IRC, it must have been aware, when it provided in § 6402(c) that "any overpayment" to be refunded shall be reduced by the amount of any past-due child support, that this would include refunds attributable to excess earned-income credits. And, although the goals of the earned-income credit—to reduce the disincentive to work caused by Social Security taxes on earned income, to stimulate the economy by funneling funds to persons likely to spend the money immediately, and to provide for relief for low-income families hurt by rising food and energy prices—are important, it cannot be said that Congress concluded that they outweigh the goals served by the subsequently enacted tax-intercept program—securing child support from absent parents and reducing the number of families on welfare. Pp. 863-865.
752 F.2d 1433 (CA 9 1985), affirmed.
BLACKMUN, J., delivered the opinion of the Court, in which BURGER, C.J., and BRENNAN, WHITE, MARSHALL, powell, REHNQUIST, and O'CONNOR, JJ., joined. STEVENS, J., filed a dissenting opinion, post, p. 866.
Peter Greenfield, Seattle, Wash., for petitioner.
Richard Farber, Washington, D.C., for respondents.
The Internal Revenue Code and the Social Security Act direct the Secretary of the Treasury to "intercept" certain tax refunds payable to persons who have failed to meet child-support obligations. In this case, the United States Court of Appeals for the Ninth Circuit ruled that payments involving earned-income credits could be intercepted. 752 F.2d 1433 (1985). We granted certiorari, 472 U.S. 1016, 105 S.Ct. 3475, 87 L.Ed.2d 611 (1985), because this ruling was in conflict with decisions of the Courts of Appeals for the Second and Tenth Circuits. See Rucker v. Secretary of Treasury, 751 F.2d 351 (CA10 1984); Nelson v. Regan, 731 F.2d 105 (CA2), cert. denied sub nom. Manning v. Nelson, 469 U.S. 853, 105 S.Ct. 175, 83 L.Ed.2d 110 (1984).
Stanley Sorenson, the husband of petitioner Marie Sorenson, was legally obligated to make child-support payments for a child of his previous marriage who was in the custody of his former wife. Mr. Sorenson was unemployed because of a disability and fell behind on those support payments. His former wife applied for welfare benefits from the State of Washington. Since 1975, the program for Aid to Families with Dependent Children (AFDC) has required, as a condition of eligibility, that applicants for welfare assign to the State concerned any right to child-support payments that has accrued at the time of assignment. Pub.L. 93-647, § 101(c)(5)(C), 88 Stat. 2359, 42 U.S.C. § 602(a)(26)(A).1 Thus, Stanley Sorenson's former wife turned over to the State her right to collect the payments Mr. Sorenson had failed to make.
Stanley and Marie Sorenson also had their own dependent child living with them. They thus were potentially eligible to receive an earned-income credit. For the calendar year 1981, the time relevant to this lawsuit, § 43 of the Internal Revenue Code of 1954, as amended, provided that an individual responsible for the support of a child living with him was allowed "as a credit against the tax imposed . . . for the taxable year an amount equal to 10 percent of so much of the earned income for the taxable year as does not exceed $5,000." As the amount of the taxpayer's earned income increased, the amount of the credit decreased, reaching zero when the taxpayer's adjusted gross income reached $10,000.2
Unlike certain other credits, which can be used only to off-set tax that would otherwise be owed, the earned-income credit is "refundable." Thus, if an individual's earned-income credit exceeds his tax liability, the excess amount is "considered an overpayment" of tax under § 6401(b), as it then read, of the 1954 Code.3 Subject to specified setoffs § 6402(a) directs the Secretary to credit or refund "any overpayment" to the person who made it.4 An individual who is entitled to an earned-income credit that exceeds the amount of tax he owes thereby receives the difference as if he had overpaid his tax in that amount.
In February 1982, petitioner and her husband timely filed a joint federal income tax return for the calendar year 1981. Petitioner had worked during part of that year, and all the Sorenson family income for the year was attributable to her wages and unemployment compensation benefits. By the return so filed, the Sorensons anticipated a refund of $1408.90, consisting in part of excess withholding on petitioner's wages and in part of an earned-income credit. The Internal Revenue Service, however, notified the Sorensons that $1,132 of the anticipated refund was being retained, under the authority granted it by the tax-intercept law, and would be paid over to the State of Washington because that State had been assigned the right to collect Mr. Sorenson's unpaid child-support obligations. See Second Declaration of Peter Greenfield, Exh. B, Sorenson v. Secretary of Treasury, No. C82-441C (WD Wash.).
The tax-intercept law essentially directs the Secretary to give priority to a State's claim for recoupment of welfare payments made to a family who failed to receive child support, see § 402(a)(26)(A) of the Social Security Act, as amended, 42 U.S.C. § 602(a)(26)(A), over an individual's claim for refund of tax overpayment. See § 6402(a), as amended, of the 1954 Code. The intercept law originally was enacted as part of the Omnibus Budget Reconciliation Act of 1981 (OBRA), Pub.L. 97-35, § 2331, 95 Stat. 860. First, OBRA § 2331(a) added § 464 to the Social Security Act, 42 U.S.C. § 664. That section directs the Secretaries of the Treasury and of Health and Human Services to establish a scheme by which a State is to notify the Secretary of the Treasury of persons who owe past-due child-support payments that have been assigned to it, and directs the Secretary of the Treasury to intercept tax-refund payments that would otherwise be paid to those persons:
§ 464(a), 42 U.S.C. § 664(a).5
Section...
To continue reading
Request your trial
-
Kihn v. Bill Graham Archives, LLC
...identical words used in different parts of the same act are intended to have the same meaning." Sorenson v. Secretary of Treasury, 475 U.S. 851, 860, 106 S.Ct. 1600, 89 L.Ed.2d 855 (1986) (internal quotation omitted). Drawing from this principle, defendants argue that section 1101 should be......
- Florida v. Becerra
-
Laskar v. Hurd, No. 19-11719
...to the clear commands of the law instead of favoring an alternative policy of judicial economy. See Sorenson v. Sec'y of Treasury , 475 U.S. 851, 865, 106 S.Ct. 1600, 89 L.Ed.2d 855 (1986) ("The ordering of competing social policies is a quintessentially legislative function."). We need not......
-
Kim v. Lee
...IBP, Inc. v. Alvarez , 546 U.S. 21, 34, 126 S.Ct. 514, 163 L.Ed.2d 288 (2005) ; see also Sorenson v. Secretary of Treasury of U.S. , 475 U.S. 851, 860, 106 S.Ct. 1600, 89 L.Ed.2d 855 (1986) ("The normal rule of statutory construction assumes that ‘identical words used in different parts of ......
-
CONGRESSIONAL RULES OF INTERPRETATION.
...(2018) [hereinafter CONG. RSCH. SERV., THEORIES]. (129.) Sullivan v. Stroop, 496 U.S. 478, 484 (1990) (citing Sorenson v. Sec'y of Treas., 475 U.S. 851, 860 (1986)); see also Powerex Corp. v. Reliant Energy Servs., Inc., 551 U.S. 224, 232 (2007); Gustafson v. Alloyd Co., 513 U.S. 561, 562 (......
-
Statutory Structure.
...See SCALIA & GARNER, supra note 7, at 174. (50.) Sullivan v. Stroop, 496 U.S. 478, 484 (1990) (quoting Sorenson v. Sec'y of Treasury, 475 U.S. 851, 860 (51.) See ESKRIDGE, INTERPRETING LAW, supra note 7, at 109. (52.) The rule against surplusage comes the closest to being a form of stru......
-
Table of Cases
...Sollid, In re, 32 Wn. App. 349, 647 P.2d 1033 (1982) . . . . . . . . . . . . . . . . . . . . . 60.15[4] Sorenson v. Sec'y of Treas., 475 U.S. 851, 106 S. Ct. 1600, 89 L. Ed. 2d 855 (1986) . 28.09[2][e]; 41.03[3] Sorenson v. Sec'y of Treas., 557 F. Supp. 729 (W.D. Wash. 1982) . . . . . . . .......
-
Table of Cases
...Ed. 2d 768 (2013): 8.4 Sorenson v.Secy of the Treasury, 557 F. Supp. 729 (W.D. Wash. 1982), aff d, 752 F.2d 1433 (9th Cir. 1985), aff d, 475 U.S. 851 (1986): 7.2(31) Stockstill v.Bart, 47 F. 231 (D. Wash. 1891): 3.3(2) United States v.Miles, No. CV 10-2398 CW, 2012 WL 1094430, 2012 U.S. Dis......