1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 WILLIAM WASHINGTON, Case No. 20-cv-05801-TSH

8 Plaintiff,

ORDER RE: MOTION TO DISMISS

9 v. Re: Dkt. No. 23 10 UNITED STATES OF AMERICA, 11 Defendant.

12 13 I. INTRODUCTION 14 Plaintiff William Washington brings this case against the government for refund of funds 15 levied by the Internal Revenue Service and applied toward his income tax liabilities. The 16 government moves to dismiss for lack of subject matter jurisdiction pursuant to Federal Rule of 17 Civil Procedure 12(b)(1) and for failure to state a claim pursuant to Rule 12(b)(6). ECF No. 23. 18 Washington filed an Opposition (ECF No. 25) and the government filed a Reply (ECF No. 26). 19 The Court finds this matter suitable for disposition without oral argument and VACATES the 20 January 28, 2021 hearing. See Civ. L.R. 7-1(b). Having considered the parties’ positions, relevant 21 legal authority, and the record in this case, the Court GRANTS the government’s motion for the 22 following reasons. 23 II. BACKGROUND 24 On August 18, 2020, Washington commenced this action seeking a refund of $29,876.12 25 of funds levied by the IRS from his wages or from his bank account for his income tax liabilities 26 for the taxable years 2003, 2004, 2007, and 2008. Compl. ¶ 6-7, ECF No. 1. He brings two 27 causes of action – (1) wrongful levy and (2) failure to release levy and unlawful tax collection – 1 addition, Washington asks the Court to determine the levy is “unreasonable,” the assessments are 2 “inappropriate,” and that the levy be “expunged” from his reports. Id. He requests “the 3 installment payments, which to date, having no agreement commemorating same, be enjoined.” 4 Id. Washington also seeks damages pursuant to 26 U.S.C. § 7433, which allows taxpayers to 5 bring a claim for damages if, “in the collection of Federal tax with respect to a taxpayer, any 6 officer or employee of the Internal Revenue Service recklessly or intentionally, or by reason of 7 negligence, disregards any provision of this title, or any regulation promulgated under this title.” 8 26 U.S.C. § 7433(a). 9 A. Washington’s 2003, 2004, 2007, and 2008 Income Tax Liabilities and Levy Payments 10 Washington alleges that between February 1 and July 11, 2013, the IRS levied $29,876.12 11 from his bank account or from his wages. Compl. ¶ 7. In support, Washington attaches IRS 12 Account Transcripts, dated October 23, 2013. Id., Ex. 1. As part of its motion, the government 13 attached Forms 4340, Certificates of Assessments and Payments, for Washington’s Individual 14 Income Tax Returns (Form 1040), for the taxable years 2003, 2004, 2007, and 2008.1 Mot., Ex. 15 A, ECF No. 23-1. 16 A review of the Account Transcript and Form 4340 for the taxable year 2003 shows that 17 after Washington failed to file a timely income tax return, the IRS issued a Notice of Deficiency 18 on February 12, 2008, and after he didn’t petition the Tax Court, the IRS made subsequent 19 assessments on July 28, 2008. After Washington submitted an untimely amended income tax 20 return, the IRS abated the previously assessed tax and subsequently assessed additional tax and 21 1 The Court may consider extrinsic evidence when “plaintiff’s claim depends on the contents of a 22 document, the defendant attaches the document to its motion to dismiss, and the parties do not dispute the authenticity of the document. . .” Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 23 2005). As discussed below, the Court may also consider extrinsic evidence when deciding factual challenges to jurisdiction under Rule 12(b)(1). Forms 4340 are admissible into evidence as self- 24 authenticating official records of the United States, carrying a presumption of correctness. See Huff v. United States, 10 F.3d 1440, 1445 (9th Cir. 1993), cert. denied, 512 U.S. 1219 (1994); 25 Hughes v. United States, 953 F.2d 531, 535, 540 (9th Cir. 1992) (“[O]fficial documents-such as IRS forms-are probative evidence in and of themselves and, in the absence of contrary evidence, 26 are sufficient to establish that notices and assessments were properly made.”); United States v. Peery, 2019 WL 3459058, at *4 (E.D. Cal. July 31, 2019), report and recommendation adopted, 27 2019 WL 4605712 (E.D. Cal. Sept. 4, 2019). As a general rule, the “Certificates of Assessments 1 other statutory additions against him on March 12, 2012. Compl., Ex. 1 at 1-3; Mot., Ex. A at 1-7. 2 Between February 19 and July 11, 2013, levy payments totaling $13,348.47 were applied to the 3 2003 taxable year. Mot., Ex. A at 4-5. The levy payments resulted in an overpayment of 4 $3,021.99 that was used to offset another agency debt pursuant to 26 U.S.C. § 6402. Id. at 6. 5 Notices of Intent to Levy were sent to Washington on November 2, 2008 and April 2, 2012. Id. 6 There is no indication that Washington filed a Collection Due Process (“CDP”) Hearing Request 7 regarding any of these notices. 8 A review of the Account Transcript and Form 4340 for the taxable year 2004 shows that 9 after Washington failed to file a timely income tax return, the IRS issued a Notice of Deficiency 10 on December 30, 2008, and after he didn’t petition the Tax Court, the IRS made subsequent 11 assessments on June 8, 2009. Washington submitted an untimely amended income tax return, 12 which the IRS accepted, and it abated a portion of the tax and additions previously assessed. 13 Compl., Ex. 1 at 4-5; Mot., Ex. A at 8-12. Between April 5 and April 18, 2013, levy payments 14 totaling $4,577.74 were applied to the 2004 taxable year. Mot., Ex. A at 10. The levy payments 15 resulted in an overpayment of $831.57 that was used to offset another agency debt pursuant to 26 16 U.S.C. § 6402. Id. at 11. Notices of Intent to Levy were sent to Washington on July 13, 2009 and 17 September 8, 2010. Id. There is no indication that Washington filed a CDP Hearing Request in 18 relation to the first notice, while the second appears to have been “refused or unclaimed.” Id. at 19 10. 20 A review of the Account Transcript and Form 4340 for the taxable year 2007 shows that 21 after Washington failed to file a timely income tax return, the IRS issued a Notice of Deficiency 22 on January 10, 2009. Washington then submitted an untimely amended income tax return, and the 23 IRS made assessments based on his submission on May 31, 2010, followed by additional 24 assessments pursuant to an examination on July 26, 2010. Compl., Ex. 1 at; Mot., Ex. A at 13-17. 25 Between May 16 and June 3, 2013, levy payments totaling $4,577.73 were applied to the 2007 26 taxable year. Mot., Ex. A at 15. The levy payments resulted in an overpayment of $1,060.77 that 27 was used to offset another agency debt pursuant to 26 U.S.C. § 6402. Id. at 16. Notices of Intent 1 indication that Washington filed a CDP Hearing Request in relation to the first Notice, while the 2 second notice appears to have been “refused or unclaimed.” Id. at 15. 3 A review of the Account Transcript and Form 4340 for the taxable year 2008 shows that 4 Washington filed an untimely income tax return that was accepted as filed by the IRS, and 5 assessments were made accordingly on March 29, 2010. Compl., Ex. 1 at 8-9; Mot., Ex. A at 18- 6 22. On May 2, 2013, a levy payment of $2,288.85 was applied to the 2008 taxable year. Mot., 7 Ex. A at 20. The levy payment resulted in an overpayment of $1,953.48 that was used to offset 8 another agency debt pursuant to 26 U.S.C. § 6402. Id. at 21. Notices of Intent to Levy were sent 9 to Washington on August 30, 2010 and March 16, 2012. Id. There is no indication that 10 Washington filed a CDP Hearing Request in relation to the first notice, while the second notice 11 appears to have been “refused or unclaimed.” Id. at 10. 12 B. Notice of Levy and Release of Levy 13 On January 21, 2013, the IRS sent Washington’s employer a Notice of Levy on Wages, 14 Salary, or Other Income, listing the taxable years at issue as 2004, 2007, and 2008. Compl., Ex. 2. 15 Washington alleges this notice was not sent to his last known address and alleges that no notice of 16 levy was sent regarding the taxable year 2003. Compl. ¶¶ 8, 12. On January 29, 2013, 17 Washington’s employer sent him a Notice of Withholding, advising him that if he disputed the 18 deductions, he must “contact the issuing agency reflected in the attached order.” Id., Ex. 9 at 7.2 19 The IRS sent Washington’s employer a Release of Levy dated June 28, 2013. Id., Ex. 10. 20 C. Alleged Identity Theft in Relation to the Taxable Year 2011 21 Washington alleges that he learned he had become the victim of identity theft on February 22 1, 2013. Compl. ¶ 14. In support, he attaches an Identity Theft Affidavit he states was submitted 23 to the IRS that same day (Ex. 6) and a letter from the IRS dated May 3, 2013 (Ex. 7). The 24 affidavit states that “someone filed a 2011 tax return, and I have yet to file 2011 or 2012,” and 25 identifies the “tax years affected” as 2011 and 2012. Id., Ex. 6. The May 3 letter advises 26 Washington that he may have been a victim of identity theft for 2011, as more than one tax return 27 1 was filed using his personal information for that year. Id., Ex. 7. The letter further advises that 2 the IRS adjusted his account to reflect the correct return information. Id. Reading the two 3 documents together, it appears that the year affected by any potential identity theft was 2011. As 4 part of its motion, the government attached a copy of IRS Account Transcripts for the taxable year 5 2011, which show that the first tax return for this year was submitted on October 29, 2012, and the 6 subsequent return was submitted on February 21, 2013. Mot., Ex. B. 7 Washington alleges the IRS should not have continued levying on his income tax liabilities 8 for the taxable years 2003, 2004, 2007, and 2008 due to an alleged identity theft related to his 9 income tax return filed for the taxable year 2011. Compl. ¶¶ 16-17. 10 D. Form 843, Claim for Refund 11 On April 12, 2015, Washington submitted a Form 843, Claim for Refund and Request for 12 Abatement, claiming a refund for $31,655.91, due to an “illegal levy on wages,” between January 13 21 and June 30, 2013. Id., Ex. 13. As he did not identify the periods for which he sought a 14 refund, the IRS sent Washington a letter on December 10, 2015, advising him that the Form 843 15 he submitted was viewed as a frivolous position and, if not corrected, the IRS would assess a 16 penalty against him. Id., Ex. 19. Washington then sent a letter to the IRS contesting the position. 17 Id., Ex. 16. Washington also sent letters to additional individuals within the IRS referring to his 18 wrongful levy claim, but he failed to elaborate the details of the alleged erroneous levies, such as 19 the dates of such levies, the liabilities they were applied to, or the basis for his contention that such 20 levies were erroneous. Id., Exs. 15, 17-18. 21 E. Other Taxable Years 22 The Complaint also includes a letter from Washington to the IRS pertaining to a Notice of 23 Levy he received for the taxable year 2015 and documents that pertain to a CDP hearing related to 24 2015. Id., Exs. 14, 20-22. He alleges he was “forced to pay $290 per month . . . for the tax 25 periods 2015, 2016, 2017, and 2018.” Compl. ¶ 22. In addition, on November 30, 2020, 26 Washington filed with the Court a Motion in Opposition to Motion for Extension of Time to File 27 Responsive Pleading, to which he attached a Notice of Intent to Levy from the IRS pertaining to 1 F. Motion to Dismiss 2 The government filed the present motion on December 21, 2020. It argues the case should 3 be dismissed for lack of subject matter jurisdiction because, to the extent Washington claims the 4 levy on his wages or bank account was wrongful under 26 U.S.C. § 7426, he is barred from 5 bringing this action because § 7426(a)(1) provides the exclusive remedy for third-party wrongful 6 levy claims. Mot. at 7. The government also argues that, even if Washington could bring a 7 wrongful levy claim, it is untimely because any claim under § 7426 must be commenced within 8 two years of the date of the levy. Id. at 8. 9 To the extent Washington seeks a refund of funds that were levied by the IRS and applied 10 to his 2003, 2004, 2007, and 2008 income tax liabilities, the government argues the Court lacks 11 subject matter jurisdiction because a taxpayer must satisfy certain jurisdictional prerequisites, 12 including filing a proper and timely claim for refund with the IRS, in accordance with 26 U.S.C. § 13 7422(a). Id. The government argues Form 843 is not a valid vehicle for claiming a refund of 14 income taxes, and there is nothing in the complaint or exhibits to suggest Washington filed any 15 other document that can be construed as a proper refund claim. Id. at 9. The government also 16 notes the Form 843 is dated April 12, 2015, and the subsequent letters addressing Form 843 are 17 dated June 5, October 12, and December 10, 2015, and that even if Form 843 and subsequent 18 letters can be construed as an informal claim for refund, the claim would only apply to the 19 amounts levied after April 12, 2013 under 26 U.S.C. § 6511(b)(2)(B). Id. at 10. 20 As to Washington’s damages claim, the government argues that, before bringing a claim 21 under 26 U.S.C. § 7433, taxpayers must exhaust their administrative remedies available within the 22 IRS. Id. (citing 26 U.S.C. § 7433(d)(1); Conforte v. United States, 979 F.2d 1375, 1377 (9th Cir. 23 1993); 26 C.F.R. § 301.7433-1(e)). Although Washington alleges he “has exhausted available 24 administrative remedies,” Compl. ¶ 24, the government argues that nothing in his complaint or 25 accompanying exhibits demonstrates that he filed an administrative claim for damages with the 26 IRS or that he in fact exhausted available administrative remedies prior to filing his complaint. 27 Mot. at 11. Even if he had, the government argues his claim for damages is untimely because any 1 Washington brought this action seven years after he was aware of the levy. Id. (citing 26 C.F.R. § 2 301.7433-1(g)(2)). 3 To the extent Washington requests installment payments to the IRS be enjoined, the 4 government notes it is unclear what installment payments he seeks to enjoin, but any such claim is 5 enjoined by the Anti-Injunction Act (“AIA”), 26 U.S.C. § 7421(a), which provides that “no suit 6 for the purpose of restraining the assessment or collection of any tax shall be maintained in any 7 court by any person, whether or not such person is the person against whom such tax was 8 assessed.” Mot. at 11. The government argues the Court lacks subject matter jurisdiction to grant 9 relief that falls within the purview of the AIA, as it is designed to permit the government to assess 10 and collect taxes with a minimum of pre-enforcement judicial interference. Id. at 12. 11 The government also seeks dismissal under Rule 12(b)(6), arguing Washington fails to 12 assert sufficient factual claims. Id. at 14. While Washington alleges he is entitled to $29,876.12 13 for funds levied and applied to his 2003, 2004, 2007, and 2008 income tax liabilities, the 14 government contends he does not provide any explanation as to why he does not owe these tax 15 liabilities. Id. at 15. Instead, the government argues, “he provides a distraction, by stating that 16 due to an alleged identity theft on an income tax return filed for 2011, the levies applied to the tax 17 years at issue should be refunded to him,” yet “nothing in his Complaint or supporting 18 documentation explains why a purported identity theft years after the liabilities at issue arose 19 justifies any kind of refund.” Id. 20 The Court finds the jurisdictional issues dispositive and therefore focuses its analysis on 21 the government’s arguments under Rule 12(b)(1). 22 III. LEGAL STANDARD 23 Federal district courts are courts of limited jurisdiction; “[t]hey possess only that power 24 authorized by Constitution and statute, which is not to be expanded by judicial decree.” Kokkonen 25 v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994) (citation omitted). Accordingly, “[i]t 26 is to be presumed that a cause lies outside this limited jurisdiction, and the burden of establishing 27 the contrary rests upon the party asserting jurisdiction.” Id.; Chandler v. State Farm Mut. Auto. 1 Federal Rule of Civil Procedure 12(b)(1) authorizes a party to move to dismiss a lawsuit 2 for lack of subject matter jurisdiction. A jurisdictional challenge may be facial or factual. Safe 3 Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). Where the attack is facial, the 4 court determines whether the allegations contained in the complaint are sufficient on their face to 5 invoke federal jurisdiction, accepting all material allegations in the complaint as true and 6 construing them in favor of the party asserting jurisdiction. Warth v. Seldin, 422 U.S. 490, 501 7 (1975). Where the attack is factual, however, “the court need not presume the truthfulness of the 8 plaintiff’s allegations.” Safe Air for Everyone, 373 F.3d at 1039. In resolving a factual dispute as 9 to the existence of subject matter jurisdiction, a court may review extrinsic evidence beyond the 10 complaint without converting a motion to dismiss into one for summary judgment. Id.; McCarthy 11 v. United States, 850 F.2d 558, 560 (9th Cir. 1988) (holding that a court “may review any 12 evidence, such as affidavits and testimony, to resolve factual disputes concerning the existence of 13 jurisdiction”). 14 IV. DISCUSSION 15 It is well settled that the United States, as sovereign, may not be sued without its consent, 16 and that the terms of its consent define the court’s jurisdiction. See United States v. Dalm, 494 17 U.S. 596, 608 (1990); United States v. Mitchell, 445 U.S. 535, 538 (1980); United States v. Testan, 18 424 U.S. 392, 399 (1976). Waivers of sovereign immunity must be unequivocally expressed and 19 are “strictly construed” in favor of the government. United States v. Idaho Dep’t of Water Res., 20 508 U.S. 1, 6-7 (1993); United States v. Nordic Vill., Inc., 503 U.S. 30, 34 (1992); Mitchell, 445 21 U.S. at 538. Consequently, no suit may be maintained against the United States unless the suit is 22 brought in exact compliance with the terms of a statute under which the United States has 23 consented to be sued. United States v. Sherwood, 312 U.S. 584, 590 (1941). Where the United 24 States has not consented to suit and there is no waiver of sovereign immunity, the Court lacks 25 jurisdiction over the subject matter of the action and dismissal is required. Gilbert v. DaGrossa, 26 756 F.2d 1455, 1458 (9th Cir. 1985); Hutchinson v. United States, 677 F.2d 1322, 1327 (9th Cir. 27 1982); Nordic Village, 503 U.S. at 34. 1 A. Wrongful Levy Under 26 U.S.C. § 7426 2 Washington lists a wrongful levy as one of his causes of action. 26 U.S.C. § 7426(a)(1) 3 provides the exclusive remedy for third-party wrongful levy claims. See EC Term of Years Tr. v. 4 United States, 550 U.S. 429, 435 (2007). “If a levy has been made on property, any person, other 5 than the person against whom the tax out of which such levy arose is assessed, who claims an 6 interest in the property, and claims that such property was wrongfully levied upon, may bring a 7 civil action against the United States.” 26 U.S.C. § 7426(a)(1) (emphasis added). In other words, 8 if the IRS levies upon property held by a third party to collect taxes owed by another, the third 9 party, not the taxpayer, may bring a wrongful levy action against the United States pursuant to § 10 7426(a)(1). Here, Washington is the taxpayer and not a third party. As such, he is barred from 11 bringing a wrongful levy claim. 12 Moreover, pursuant to 26 U.S.C. § 6532(c)(1), any claim under § 7426 must be 13 commenced within two years of the date of the levy. Here, the levy took place in 2013, yet 14 Washington commenced this action in 2020. As such, even if Washington could bring a wrongful 15 levy claim, it is untimely. 16 Finally, in his opposition, Washington fails to address his wrongful levy claim under § 17 7426, thus leaving the government’s motion uncontested. In sum, Washington may not bring a 18 wrongful levy claim under § 7426, any such claim would be untimely, and the Court therefore 19 lacks subject matter jurisdiction over this claim. 20 B. Refund Claim Under 26 U.S.C. § 7422 21 In his complaint, Washington appears to seek a refund of the funds that were levied by the 22 IRS and applied to his 2003, 2004, 2007, and 2008 income tax liabilities. Compl. at 2, 9. 23 However, in his opposition, he admits he is not “contesting the validity of the taxes due for 2019, 24 2003, 2004, 2007, 2008, or any other year.” Opp’n at 7. Regardless, the Court lacks subject 25 matter jurisdiction over these claims. 26 For a Court to have subject matter jurisdiction over a tax refund suit, a taxpayer must 27 satisfy certain jurisdictional prerequisites. Generally, first, the taxpayer must have filed a proper 1 U.S. at 601-02; Boyd v. United States, 762 F.2d 1369, 1371 (9th Cir. 1985). Second, the 2 taxpayer’s claim for refund must either have been rejected by the IRS or not have been acted upon 3 by the IRS for six months. 26 U.S.C. § 6532(a)(1); Thomas v. United States, 755 F.2d 728, 729 4 (9th Cir. 1985). And third, a taxpayer must have “fully paid” the tax for which a refund is sought. 5 Flora v. United States, 357 U.S. 63, 75 (1958), aff’d on reh’g, 362 U.S. 145 (1960); Thomas, 755 6 F.2d at 729. “If the refund claim does not meet the requirements of the Code and the regulations, 7 the suit must be dismissed.” Boyd, 762 F.2d at 1371 (citing L.E. Myers Co. v. United States, 673 8 F.2d 1366, 1367 (Ct. Cl. 1982)). This is “because filing pursuant to the rules is a jurisdictional 9 prerequisite.” Id. (citing Martinez v. United States, 595 F.2d 1147, 1148 (9th Cir. 1979) (per 10 curiam); Bear Valley Mut. Water Co. v. Riddell, 493 F.2d 948, 951 (9th Cir. 1974)). 11 Here, Washington failed to file a proper administrative claim for refund. First, Form 843 12 is not a valid vehicle for claiming a refund of income taxes, and the regulations require that a 13 claim for refund be made on Form 1040. See 26 C.F.R. § 1.6012-1(a)(6); 26 C.F.R. § 301.6402- 14 3(a)(2); 26 C.F.R. § 301.6402–3(a)(5); Wheelis v. United States, 2002 WL 1482527, at *2 (D. 15 Ariz. May 22, 2002) (“Form 843 is not a valid vehicle for claiming a refund of income taxes. The 16 regulations require that a claim for refund be made on Form 1040.”). As such, Washington did 17 not submit a proper administrative refund claim with the IRS for a refund of his 2003, 2004, 2007, 18 and 2008 tax liabilities, and there is nothing in the complaint or exhibits to suggest he filed any 19 other document that can be construed as a proper refund claim. 20 Further, Washington’s Form 843 and subsequent letters to the IRS cannot constitute a 21 timely informal refund claim because they fail to adequately apprise the IRS of his request. These 22 letters include correspondence from Washington to the IRS dated December 13, 2015 (Compl., 23 Ex. 16) in response to a letter dated December 10, 2015, advising him that the Form 843 he 24 submitted is viewed as a frivolous position (id., Ex. 19), as well as letters he sent to additional 25 individuals within the IRS referring to his wrongful levy claim on June 25, 2015 (id., Ex. 18), 26 October 12, 2015 (id., Ex. 17), and January 6, 2017 (id., Ex. 15). However, it is unclear from 27 these documents what periods he is seeking a refund for and what amount he is seeking for each of 1 of such levies, the liabilities they were applied to, or the basis for his contention that such levies 2 were erroneous. See 26 C.F.R. § 301.6402-2(b)(1) (“The claim must set forth in detail each 3 ground upon which a credit or refund is claimed and facts sufficient to apprise the Commissioner 4 of the exact basis thereof. . .. A claim which does not comply with this paragraph will not be 5 considered for any purpose as a claim for refund or credit.”); United States v. Kales, 314 U.S. 186, 6 194 (1941) (notice must fairly advise the IRS “of the nature of the taxpayer’s claim”); Duggan v. 7 United States, 757 F. App’x 533, 535 (9th Cir. 2018); Boyd, 762 F.2d at 1372 (“[T]he IRS is 8 entitled to take the refund claim at face value and examine only the points to which it directs 9 attention. If the claim on its face does not call for investigation of a question, the taxpayer may 10 not later raise that question in a refund suit.”) (internal citations omitted). 11 Moreover, any informal claim must still be later formalized in order to be considered a 12 proper timely refund claim. See Kales, 314 U.S. at 194 (“This Court, applying the statute and 13 regulations, has often held that a notice fairly advising the Commissioner of the nature of the 14 taxpayer’s claim, which the Commissioner could reject because too general or because it does not 15 comply with formal requirements of the statute and regulations, will nevertheless be treated as a 16 claim where formal defects and lack of specificity have been remedied by amendment filed after 17 the lapse of the statutory period”) (emphasis added, internal citations omitted); Duggan, 757 F. 18 App’x at 535; Comm’r of Internal Revenue v. Ewing, 439 F.3d 1009, 1015 (9th Cir. 2006); 19 Pennoni v. United States, 86 Fed. Cl. 351, 363-64 (2009) (and cases cited therein). Nothing in 20 Washington’s opposition shows that he has satisfied these requirements or formalized his refund 21 claim at any point. As such, he failed to show that he has made a proper administrative claim for 22 refund with the IRS. 23 Finally, the Form 843 is dated April 12, 2015, and the subsequent letters addressing Form 24 843 are dated June 25, October 12, and December 13, 2015, and January 6, 2017. Compl., Exs. 25 13, 15-18. Even if the Form 843 and subsequent letters can be construed as an informal claim for 26 refund, the claim would only apply to the amounts levied after April 12, 2013. See 26 U.S.C. § 27 6511(b)(2)(B). 1 WL 1676767, at *2 (Fed. Cl. Apr. 9, 2010), for the proposition that the requirements of 26 U.S.C. 2 §§ 7422 and 6511, when read in conjunction with § 1346, should be broadly construed. Opp’n at 3 15-20. Citing to the Burch Court’s review of the history of the Supreme Court’s interpretation of 4 the principal of sovereign immunity, he concludes that because the Burch Court observed that “In 5 recent years, however, the Supreme Court decisions concerning the sovereign immunity doctrine 6 seems to have taken a large step back from the rigorous enforcement of the doctrine specified in 7 the 1990s opinions,” Burch, 2010 WL 1676767, at *5, this Court should decide that it has 8 jurisdiction over his claim. Opp’n at 19. The Court disagrees. 9 First, while the analysis in Burch shows some fluctuation in the strictness of the waiver of 10 sovereign immunity doctrine and arguable softening of its application by the Supreme Court, it 11 was done in the context of a party seeking to apply the strict construction principle to a statute or 12 section of a statute separate from the one that supplied the waiver of sovereign immunity itself. 13 See Gomez-Perez v. Potter, 553 U.S. 474, 491 (2008) (refusing to apply strict construction 14 principle to substantive provision of subsection where the waiver of sovereign immunity was 15 contained in another subsection); United States v. White Mountain Apache Tribe, 537 U.S. 465, 16 472-73 (2003) (holding that where one statute provides for a waiver of sovereign immunity to 17 enforce a separate statute, the latter statute is not subject to the strict construction principle). 18 Second, in another case identified by the Burch Court, Richlin Sec. Serv. Co. v. Chertoff, 553 U.S. 19 571 (2008), the Court analyzed “some ambiguity” in the law when applying the sovereign 20 immunity principle. The Richlin Court in fact noted that when there is no ambiguity to construe, 21 “[t]here is no need for us to resort to the sovereign immunity canon.” Id. at 590. 22 Here, there is no ambiguity for the Court to interpret. The requirements to establish 23 subject matter jurisdiction over a tax refund suit are unambiguous and have long been established 24 by courts. As discussed above, for a court to have subject matter jurisdiction over a tax refund 25 suit, a taxpayer must satisfy certain jurisdictional prerequisites. Numerous district courts within 26 the Ninth Circuit have continued to follow these principles, even after Burch. See, e.g., Jianglin 27 Zhou v. U.S. Internal Revenue Serv., 2019 WL 286115, at *3 (N.D. Cal. Jan. 22, 2019); Rashidian 1 2019 WL 176800, at *1-2 (D. Ariz. Jan. 11, 2019). 2 Finally, Washington argues that because the IRS did not issue a notice of disallowance in 3 accordance with 26 U.S.C. § 6532 regarding his alleged claim, it “prohibited [him] from 4 complying with Sections 7422(a) . . .” Opp’n at 19. This argument is also unavailing. As 5 demonstrated above, Washington failed to file a proper refund claim with the IRS, and as such, the 6 IRS could not have denied such refund claim. Washington’s argument effectively reverses the 7 statutory order of operations, by which the IRS must receive a proper refund claim in order to 8 reject it. Nothing in the statute prohibits taxpayers from making a proper refund claim on their 9 own and then suing on it. Indeed, 26 U.S.C. § 6532 allows taxpayers to file suit after submitting a 10 proper refund claim and waiting six months with no response. Thus, no action from the IRS was 11 required to allow Washington to pursue his rights, had he made a proper claim for refund. To the 12 extent action was required, the IRS did in fact let Washington know that his submission was 13 problematic. On December 10, 2015, the IRS sent Washington a letter advising him that the Form 14 843 he submitted was viewed as a frivolous position, and further advising him that if it was not 15 corrected, the IRS would assess a penalty against him. Compl., Ex. 19. Therefore, Washington 16 was on notice that the IRS did not view his Form 843 as a valid refund claim, yet he still failed to 17 submit a proper refund claim. 18 In sum, Washington failed to show that he has made a proper administrative claim for 19 refund with the IRS, and because he never submitted a proper claim, no such claim was ever 20 rejected or acted upon. Because he failed to satisfy the requirements of 26 U.S.C. § 7422, the 21 Court lacks subject matter of this action. 22 C. Damages Claim Under 26 U.S.C. § 7433 23 Washington also seeks damages under 26 U.S.C. § 7433, which allows taxpayers to bring a 24 claim for damages if, “in the collection of Federal tax with respect to a taxpayer, any officer or 25 employee of the Internal Revenue Service recklessly or intentionally, or by reason of negligence, 26 disregards any provision of this title, or any regulation promulgated under this title.” 26 U.S.C. § 27 7433(a). However, before bringing any such claim, taxpayers must exhaust their administrative 1 26 C.F.R. § 301.7433-1(e) (specifying required administrative remedies).3 2 Washington generally asserts he “has exhausted available administrative remedies.” 3 Compl. ¶ 24; Opp’n at 22. To demonstrate such exhaustion, he argues that he wrote to “the [IRS] 4 Area Director”, that the IRS wrote to him, that he communicated with various IRS employees by 5 correspondence and by telephone, that he went before the Tax Court and participated in a CDP 6 hearing, and that he contacted the Taxpayer Advocate Service, as well as his Congressman. Opp’n 7 at 22. 8 26 C.F.R. § 301.7433-1(e) establishes the procedure for making an administrative claim 9 for less than $1,000,000 in damages and provides that such claim must be: (1) sent in writing to 10 the Area Director, Attn: Compliance Technical Support Manager of the area in which the taxpayer 11 currently resides; and (2) include the following: (i) name, current address, current home and work 12 telephone numbers and any convenient times to be contacted, and taxpayer identification number 13 of the taxpayer making the claim; (ii) the grounds, in reasonable detail, for the claim (include 14 copies of any available substantiating documentation or correspondence with the IRS); (iii) a 15 description of the injuries incurred by the taxpayer filing the claim (include copies of any available 16 substantiating documentation or evidence); (iv) the dollar amount of the claim, including any 17 damages that have not yet been incurred but which are reasonably foreseeable (include copies of 18 any available substantiating documentation or evidence); and (v) the signature of the taxpayer or 19 duly authorized representative. Id. 20 In his opposition, Washington points to a letter dated May 26, 2018 and addressed to the 21 IRS Area Director, Attn: Compliance Technical Support Manager. Compl., Ex. 14. The letter 22

23 3 Some courts have questioned whether this exhaustion requirement is jurisdictional in light of Arbaugh v. Y&H Corp., 546 U.S. 500, 515-16 (2006), which states that statutory limitations 24 should be viewed as non-jurisdictional in the absence of a clear statement that the limitation is jurisdictional. See, e.g., Hoogerheide v. I.R.S., 637 F.3d 634, 636, 638 (6th Cir. 2011); Kim v. 25 United States, 632 F.3d 713, 719 (D.C. Cir. 2011). Following the Supreme Court’s decision in Arbaugh, however, the Ninth Circuit has retained the position articulated in Conforte, that the 26 exhaustion requirement in § 7433 is jurisdictional. See, e.g., Joseph v. United States, 517 Fed. App’x 543 (9th Cir. 2013); Camangian v. United States, 475 Fed. App’x 216 (9th Cir. 2012); 27 Manant v. United States, 498 Fed. App’x 752 (9th Cir. 2012). This result makes sense, because 1 does have some of the hallmarks of a valid claim. It includes Washington’s name and contact 2 information, a description of the injuries he alleges to have suffered (e.g., his allegations that he 3 has not “been able to recover from this loss of monies,” and that he is “unable to get my attorney’s 4 license back despite being under an indefinite suspension since 1997”), the amount of damages he 5 sought ($155,000), and his signature. Id. The letter also indicates that “substantiating 6 documentation is attached,” though it is unclear what such substantiation was, as copies were not 7 included with Washington’s complaint or opposition. Thus, it remains unclear if Washington in 8 fact fully complied with the requirements of 26 C.F.R. § 301.7433-1(e) for a valid claim for 9 damages. 10 Regardless, even if the Court construes the May 26, 2018 letter as a valid administrative 11 claim for damages, Washington’s claim for damages is still untimely under 26 U.S.C. § 12 7433(d)(3), which provides that any action to enforce liability “may be brought only within two 13 years after the date the right of action accrues.” 26 C.F.R. § 301.7433-1(g)(2) provides that “a 14 cause of action . . . accrues when the taxpayer has had a reasonable opportunity to discover all 15 essential elements of a possible cause of action.” See also Dalm, 494 U.S., at 608 (statute of 16 limitations requiring suit against the government be brought within a certain time frame is one of 17 the terms of consent to be sued); Tritz v. United States, 698 F. App’x 342, 343 (9th Cir. 2017). 18 Here, Washington was aware of the levy at issue at the latest in January of 2013, when his 19 employer sent him a Notice of Withholding. Compl., Ex. 9. Washington, however, made no 20 administrative claim until five years later in 2018, and he brought this action seven years later, in 21 2020. Therefore, even if Washington’s May 26, 2018 letter to the IRS can be construed as a valid 22 claim for damages and an exhaustion of his administrative remedies, his claim for damages is 23 untimely, and his damages claim under 26 U.S.C. § 7433 must be dismissed for lack of subject 24 matter jurisdiction. 25 D. Liabilities for Taxable Years Other than 2003, 2004, 2007, and 2008 26 In his complaint, Washington requests that “the installment payments, which to date, 27 having no agreement commemorating same, be enjoined.” Compl. at 9. While it is not entirely 1 14 and 20-22 documents pertaining to the 2015 taxable year. The complaint also provides that 2 Washington was “forced to pay $290 per month . . . for the tax periods 2015, 2016, 2017, and 3 2018 . . .” Id. ¶ 22. Further, as part of his opposition to the government’s motion for an extension 4 of time to respond to the complaint, Washington attached a Notice of Intent to Levy from the IRS 5 pertaining to his income tax liabilities for the taxable year 2019. ECF No. 21 at 5. While 6 Washington identifies the taxable years 2015 through 2019 in his complaint and the attachments 7 thereto, he does not state that he is seeking a refund for any of these periods or contest any specific 8 amount. 9 To the extent Washington seeks to bar the IRS from collection action pertaining to the 10 taxable years 2015 through 2019, or any other taxable years, such claims are barred by the AIA. 11 With limited exceptions not relevant here, the AIA, provides that “no suit for the purpose of 12 restraining the assessment or collection of any tax shall be maintained in any court by any person, 13 whether or not such person is the person against whom such tax was assessed.” 26 U.S.C. § 14 7421(a). The purpose of this section is “to permit the United States to assess and collect taxes 15 alleged to be due without judicial intervention, and to require that the legal right to the disputed 16 sum be determined in a suit for refund.” Enochs v. Williams Packing Nav. Co., 370 U.S. 1, 7 17 (1962). The Act should be “strictly enforced.” Maxfield v. U.S. Postal Serv., 752 F.2d 433, 434 18 (9th Cir. 1984) (citing Bob Jones Univ. v. Simon, 416 U.S. 725, 734 (1974)). The Court lacks 19 subject matter jurisdiction to grant relief that falls within the purview of the AIA, which is 20 designed to permit the government to assess and collect taxes with a minimum of pre-enforcement 21 judicial interference. Bob Jones Univ., 416 U.S. at 736. Unless the parties seeking to enjoin the 22 government clearly set forth one of the limited statutory or judicially created exceptions to the 23 AIA, the Court has no jurisdiction and the action must be dismissed. Elias v. Connett, 908 F.2d 24 521, 523 (9th Cir. 1990). The taxpayer must demonstrate that no circumstance exists in which the 25 government could prevail in the suit. United States v. Condo, 782 F.2d 1502, 1506 (9th Cir. 1986) 26 (citing Enochs, 370 U.S. at 7). The AIA has been broadly construed to deprive courts of 27 jurisdiction to enjoin any type of IRS activity that may, even indirectly, affect the assessment or 1 466 (9th Cir. 1979). 2 To the extent Washington requests the IRS be enjoined from collecting on his income tax 3 liabilities for the taxable years 2015 through 2019, it is in clear interference with the IRS’s tax 4 || collection actions. Accordingly, the AIA prohibits these claims unless he can demonstrate the 5 government could not possibly prevail in this suit. However, not only does the complaint fail to 6 || allege or infer any exceptions to the AIA, see McGraw vy. United States, 2008 WL 4000570 at *3 7 (W.D. Wash. 2008) (relief barred where no exception is alleged), nothing in the complaint 8 indicates that the IRS made any assessments or took any collection actions without the authority 9 || provided by statute. Further, to the extent Washington disputes the assessment or collection 10 actions taken in relation to the taxable years 2015 through 2019, he is not without remedy, as he 11 can file (or could have filed) a refund claim with the IRS pursuant to 26 U.S.C. § 7422 or a claim 12 for damages under 26 U.S.C. § 7433. 5 13 In sum, to the extent Washington seeks to enjoin the IRS from collection action for the 14 || taxable years 2015 through 2019 or any other taxable years, his claims are barred by the AIA, the 15 Court lacks subject matter jurisdiction, and the claims must be dismissed. 16 Vv. CONCLUSION 17 For the reasons stated above, the Court GRANTS the government’s motion to dismiss for S 18 lack of subject matter jurisdiction. As leave to amend would be futile, this case is DISMISSED 19 || WITH PREJUDICE. Judgment shall be entered accordingly. 20 IT IS SO ORDERED. 21 22 || Dated: January 20, 2021 23 AY \ . Lj

THOMAS S. HIXSON

24 United States Magistrate Judge 25 26 27 28