Supreme Court Rules No Equitable Tolling for Filing Tax Refund Claims

                 SUPREME COURT OF THE UNITED STATES

[2] The two cases before us raise a single question. Can courts toll, for nonstatutory equitable reasons, the statutory time (and related amount) limitations for filing tax refund claims set forth in section 6511 of the Internal Revenue Code of 1986? We hold that they cannot.

[3] These two cases present similar circumstances. In each casea taxpayer initially paid the Internal Revenue Service several thousand dollars that he did not owe. In each case the taxpayer (or his representative) filed an administrative claim for refund several years after the relevant statutory time period for doing so had ended. In each case the taxpayer suffered a disability (senility or alcoholism), which, he said, explained why the delay was not his fault. And in each case he asked the court to extend the relevant statutory time period for an "equitable" reason, namely the existence of a mental disability -- a reason not mentioned in section 6511, but which, we assume, would permit a court to toll the statutory limitations period IF; BUT ONLY IF; section 6511 contains an implied "equitable tolling" exception. See 4 C. Wright & A. Miller, Federal Practice and Procedure section 1056 (2d ed. 1987 and Supp. 1996); see also Wolin v. Smith Barney, Inc., 83 F. 3d 847, 852 (CA7 1996) (defining equitable tolling).

[4] In both cases, the Ninth Circuit read section 6511 as if it did contain an implied exception that would permit "equitable tolling." It then applied principles of equity to each case. It found those principles justified tolling the statutory time period. And it permitted the actions to proceed. 67 F. 3d 260 (1995); judgt. order reported at 70 F. 3d 120 (1995). All other Circuits that have considered the matter, however, have taken the opposite view. They have held that section 6511 does not authorize equitable tolling. See Amoco Production Co. v. Newton Sheep Co., 85 F. 3d 1464 (CA10 1996); Lovett v. United States, 81 F. 3d 143 (CA Fed. 1996); Webb v. United States, 66 F. 3d 691 (CA4 1995); Oropallo v. United States, 994 F. 2d 25 (CA1 1993) (per curiam); and Vintilla v. United States, 931 F. 2d 1444 (CA11 1991). We granted certiorari to resolve this conflict. And we conclude that the latter Circuits are correct.

[5] The taxpayers rest their claim for equitable tolling upon Irwin v. Department of Veterans Affairs, 498 U.S. 89 (1990), a case in which this Court considered the timeliness of an employee's lawsuit charging his Government employer with discrimination, in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. section 2000e et seq. The Court found the lawsuit untimely, but nevertheless tolled the limitations period. It held that the "rule of equitable tolling" applies "to suits against the Government, in the same way that it is applicable" to Title VII suits against private employers. 498 U.S., at 94-95. The Court went on to say that the "same rebuttable presumption of equitable tolling applicable to suits against private defendants should also apply to suits against the United States." Id., at 95-96.

[6] The taxpayers, pointing to Irwin, argue that principles of equitable tolling would have applied had they sued private defendants, e.g., had they sought restitution from private defendants for "Money Had and Received." See C. Keigwin, Cases in Common Law Pleading 220 (2d ed. 1934). They add that given Irwin's language, there must be a "presumption" that limitations periods in tax refund suits against the Government can be equitably tolled. And, they say, that "presumption," while "rebuttable," has not been rebutted. They conclude that, given Irwin, the Ninth Circuit correctly tolled the statutory period for "equitable" reasons.

[7] In evaluating this argument, we are willing to assume, favorably to the taxpayers but only for argument's sake, that a tax refund suit and a private suit for restitution are sufficiently similar to warrant asking Irwin's negatively phrased question: Is there good reason to believe that Congress did NOT want the equitable tolling doctrine to apply? But see Flora v. United States, 362 U.S. 145, 153-154 (1960) (citing Curtis's Administratrix v. Fiedler, 2 Black 461, 479 (1863)) (distinguishing common-law suit against the tax collector from action of assumpsit for money had and received); George Moore Ice Cream Co. v. Rose, 289 U.S. 373, 382-383 (1933); see also Plumb, Tax Refund Suits Against Collectors of Internal Revenue, 60 Harv. L. Rev. 685, 687 (1947) (describing collector suit as a fiction solely designed to bring the Government into court). We can travel no further, however, along Irwin's road, for there are strong reasons for answering Irwin's question in the Government's favor.

[8] Section 6511 sets forth its time limitations in unusually emphatic form. Ordinarily limitations statutes use fairly simple language, which one can often plausibly read as containing an implied "equitable tolling" exception. See, e.g., 42 U.S.C. section 2000e- 16(c) (requiring suit for employment discrimination to be filed "[w]ithin 90 days of receipt of notice of final [EEOC] action. . ."). But section 6511 uses language that is not simple. It sets forth its limitations in a highly detailed technical manner, that linguistically speaking, cannot easily be read as containing implicit exceptions. Moreover, section 6511 reiterates its limitations several times in several different ways. Section 6511 says, first, that a

     "[c]laim for . . . refund . . . of any tax . . . shall be filed

[9] To read an "equitable tolling" provision into these provisions, one would have to assume an implied exception for tolling virtually every time a number appears. To do so would work a kind of linguistie havoc. Moreover, such an interpretation would require tolling, not only procedural limitations, but also substantive limitations on the amount of recovery -- a kind of tolling for which we have found no direct precedent. Section 6511's detail, its technical language, the iteration of the limitations in both procedural and substantive forms, and the explicit listing of exceptions, taken together indicate to us that Congress did not intend courts to read other unmentioned, open-ended, "equitable" exceptions into the statute that it wrote. There are no counter- indications. Tax law, after all, is not normally characterized by case-specific exceptions reflecting individualized equities.

[10] The nature of the underlying subject matter -- tax collection -- underscores the linguistic point. The IRS processes more than 200 million tax returns each year. It issues more than 90 million refunds. See Dept. of Treasury, Internal Revenue Service, 1995 Data Book 8-9. To read an "equitable tolling" exception into section 6511 could create serious administrative problems by forcing the IRS to respond to, and perhaps litigate, large numbers of late claims, accompanied by requests for "equitable tolling" which, upon close inspection, might turn out to lack sufficient equitable justification. See H.R. Conf.Rep. No. 356, 69th Cong., 1st Sess., 41 (1926) (deleting provision excusing tax deficiencies in the estates of insane or deceased individuals because of difficulties involved in defining incompetence). The nature and potential magnitude of the administrative problem suggest that Congress decided to pay the price of occasional unfairness in individual cases (penalizing a taxpayer whose claim is unavoidably delayed) in order to maintain a more workable tax enforcement system. At the least it tells us that Congress would likely have wanted to decide explicitly whether, or just where and when, to expand the statute's limitations periods, rather than delegate to the courts a generalized power to do so wherever a court concludes that equity so requires.

[11] The taxpayers' counter-rebuttal consists primarily of an interesting historical analysis of the Internal Revenue Code's tax refund provisions. They try to show that section 6511's specific, detailed language reflects congressional concern about matters not related to equitable tolling. They explain some language, for example, in terms of a congressional effort to stop taxpayers from keeping the refund period open indefinitely through the device of making a series of small tax payments. See S.Rep. No. 398, 68th Cong., 1st Sess., 33 (1924). They explain other language as an effort to make the refund time period and the tax assessment period coextensive. See H.R. Rep. No. 2333, 77th Cong., 2d Sess., 52 (1942). Assuming all that is so, however, such congressional efforts still seem but a smaller part of a larger congressional objective: providing the Government with strong statutory "protection against stale demands." Cf. United States v. Garbutt Oil Co., 302 U.S. 528, 533 (1938) (statute of limitations bars untimely amendment of claim for additional refund). Moreover, the history to which the taxpayers point reveals that section 6511's predecessor tax refund provisions, like section 6511, contained highly detailed language with clear time limits. See, e.g., section 281(b) of the Revenue Act of 1924, ch. 234, 43 Stat. 301 (4-year limit on claims for overpayment of income, war-profits, or excess-profits tax and cap on refund amount); section 322(b) of the Revenue Act of 1932, ch. 209, 47 Stat. 242 (2-year limit for claim filing and corresponding limit on refund amount); Internal Revenue Code of 1954, 68A Stat. 808 (adopting current alternative time and amount limitations); see also section 810 of the Revenue Act of 1932, ch. 209, 47 Stat. 283 (imposing time and amount limits for estate tax refunds). And that history lacks any instance (but for the present cases) of equitable tolling. On balance, these historical considerations help the Government's argument.

[12] For these reasons, we conclude that Congress did not intend the "equitable tolling" doctrine to apply to section 6511's time limitations. The Ninth Circuit's decisions are

[13] Reversed.