and at this time we'll hear borenstein versus the commissioner of internal revenue good morning your honour's kendall jones from ever showed sutherland in washington d c representing the appellant roberta borenstein who is the taxpayer in this case may please the court twenty two years ago the supreme court in a case called lundy v commissioner resolved a split in the circuit courts in a situation where one if a taxpayer hadn't filed a return to the taxpayer received an iris notice of deficiency three the tax payer then petition the tax court and for the tax court determined that the taxpayer had overpaid his or her taxes the supreme court resolved the question of whether the court had jurisdiction to look back two years or three years prior to the issuance of the notice of deficiency and the supreme court held that under the then existing section sixty five twelve b of the internal revenue code the lookback period was two years not three years so one year later in one nine hundred ninety seven congress legislatively reversed the lundy case amending section sixty five twelve b three and it's the proper construction of the one nine hundred ninety seven amendment that's at issue today in this case the tax court held under that amendment it did not have jurisdiction under the facts in this case to order re for a refund however obviously we believe that the tax court did have jurisdiction the facts are are very brief your honour's the t xpayer timely paid her two thousand and twelve taxes she asked for an automatic extension of time extending the due date from april fifteenth to october fifteenth two thousand and thirteen but she didn't use the extension she didn't file a return pay on that date and she was fully in time we paid for taxes the tax court after and after the parties had had their settlement discussions determined there were no there was no deficiency indeed she had over paid her taxes by a slight amount the tax court and the government agree i believe your honour's that had the taxpayer not sought filed an extension again one that she did not use if she had not file that we treat the phrasing in this statute of with extensions just as we do in the context of hundreds of other statutes that refer to a taxpayer's right to an extension and it's an important difference the context of the statute your hon in the hundreds of cysts that you asians in the code where a taxpayer has the right to request an extension to perform an act or make a payment the the taxpayer is being granted relief this statute sixty five twelve doesn't do anything in terms of granting the taxpayer relief it simply determines under the lookback rules the a political look back period and example the government in its brief i believe in  conflated or decided that the extended due date becomes the due date for all purposes that's simply not true and i can give you an example if attached payer asked for an extension from april fifteenth and then didn't file on the extended due date of october fifteenth but let's say filed in december and owed tax to the government the government under section sixty six fifty one would compute a late filing penalty beginning on april fifteenth because the the extension period gets ended on after the three years correct is added on to it during the third year yes but the look back period is only three years it is so what so what's the purpose of that extension period it seems to have no function it could have a function if the taxpayer had made a payment of taxes later after the extent to do that so taxpayers will often make payments for example on the extension date or thereafter as they can afford it and so in in the period with your reading see the extension was six months so you go out three years and six months and then look back right yes so what if they made a pain in the six months between the time the original and the original time for filing april fifteenth and six months thereafter up until october it would be able to get that right that's correct so that so your reading of it has a black hole in it too just like the unfor situation she found herself in which the tact which the i r s says is the first time this is ever happened in twenty years and assertion that was so so your so your of your absurd result argument of a black hole creates a black hole the crease a black hole that may or may or may not exist for a taxpayer depending when they made their payment which didn't exist or anybody else for twenty years until your client fell into it that's true but so so why would we why would we adopt another one so that you know just as cargoes or judge cardoza once said that every time he thought he was making a rule he thought the tumblers of human experience were immediately beginning to interact to create the absurd result of the rule that he was creating i mean why would we why would we why would we do what you ask us to do only to have human experience produce that result within a year or two a court is presented with the two alternatives in interpreting a statute and one of them does a but much better job of furthering congressional purpose or meeting that blackhole no different than the government is just a different time period i don't see how that is a better job of it because there is your client relieved but that's not a better job to someone else who falls into the new black hole you've created but your honor we responded to the government's assertion that this is the first time or one of the few times there's probably a new black hole argument that the new black hole would exist only to the extent that is more than three years and is more than a three year look back yes and three you look back congress tried to establish in overruling lundy yes so you got this through your looking back three years and it's this and it's the same black hole that would exist if you wanted to look back four years but you period in which there will be from the time of the original time to file yes act whole if there's any payments made within the period of time yes you mentioned yes your honor another issue we didn't talk about but in answer to one of your earlier questions it this is the only place in the internal revenue code that the words with extensions appears in parentheses there must have been intended meeting meaning for those parentheses this wasn't a statute that was granting a taxpayer relief or telling the taxpayer they had more time to do something but the logical reason is the cross reference to sixty five eleven so he was trying to bring this into sync with the statute that governs claims that go directly to the district i can explain why clock watt like congress used the word over plus your honor but there was no reason for them to look at me looking at the other four hundred statutes that grant taxpayers relief and additional time that wasn't the issue the issue is what have the supreme court said in lundie and how to overcome that problem so they look they naturally had to look to section sixty five eleven that's what sixty five twelve requires you you have n please court my name is ivan dale on behalf of the commissioner of internal revenue so the problem with the tax payers argument in this case is that she is asking this court to expand the tax court's jurisdiction to award a refund by interpretating a statute to mean exactly the opposite of what the words of the well if you i'd like to explain where where where i'm coming from so the operative words of the statute are during the third year after the due date with extensions for filing the return so the tax court's jurisdiction order refund turns on whether the deficiency notice was mailed during the third year and that third year is measured by reference to a due date now the taxpayer got an extension to her due date making it due october fifteenth two thousand and thirteen the problem with tax payers argument in this case is the only way that the deficiencies notice was mailed during the third year after the due date is if the due date is calculated without regard to the extensions in other words the taxpayer m show that the notice of deficiency was mailed during the third year after the due date without regard to extensions the the  but the last antecedent phrase is during the third year after the due date and the third year after the due date with extensions brings you to three and a half years with right with the extension stuck on at the end well it no we would prefer it would be a third year that commences two years after the due date with extensions do you think the congress intended to create the whole black hole gap whatever you want to call or do you think it just it's just an oversight so i mean congress intended to remedy the result in london and it didn't do that the taxpayer lundy would be able to get a refund under the statute as it applies now taxpayers complaint is that remedy was incomplete that it should have encompassed more taxpayers i don't know what congress intended as i know what the words of the statute say more is what your adversary is saying is that once you have three years and six months where your three years and six months then at the end of the three years and six months you can look back three years and that seems to be the the goal of congress was to in our three year look back now if you if you pay money making over payment then you wait three and a half years we wait for years you can't you can't look back and for what you can certainly look back three years you can look back three years three years without a gap because  really make any sense so you can see you can only look back three years if the notice was filed during the third year after the due date with extensions you can look back three years if the written notice was mailed during the second year you can't look back three years if the notice was mailed during the fourth year you can only look back at the notice was mailed during the third year after the due date starts it determines the clock and it but if you and if you file the notice of divisions he was here preceded the filing i mean if if she had filed in if she had filed at some point time before a notice of deficiency the problem i have is that that reading it the other way creates an equally an area from what i always think of as that dreaded day pro fifty eight that would be the day my son was born so it at least it has some pleasure to associate with april fifteenth so it does create a period of time if we take their reading of it where there's an extension that and that you add on to the three years and guarantees that there be a period of time from the original due date out whatever the length of the extension is which you can't recover as long as it's oh that's correct because the because the the lookback period is three years whereas the look back area for a refund claim is three years plus the period of any extension in write so there's two i think there's two there's two periods here one is sort of the triggering period in the triggering period as was the notice of deficiency mailed during the third year right if you satisfy that criteria you look back then you get a three year lookback period is that you that's when you finally know what the i r s think you are right so it shouldn't be you shouldn't eat like lundy was penalize because of the fact that he could only look back two years and that efficiency was served outside then well yes that's right i mean i don't know that it's a penalty like i said before this statute she would have gotten a refund in tax court i mean it's a jurisdictional grant to the tax court she even still could have instead of petitioning the tax court she could have gone to district court right so it's a jurisdictional grounds to the tax court and you're correct that the taxpayers argument would put the gap on the end rather than on the fun then the front isn't that even more so the case with the taxpayers over pay and the government wants to glom onto that money and not give it back so there's really not a general principle that grants and tax court jurisdiction are resolved favorably to the taxpayers and jurisdictional grant and every viewer would you could see if we spent all this time discussing what it means that there's a big you would either language there might be ambiguity as to whether with extensions my also modifies thirty year that's said or what it says with or made for us but right in even if it says plus we win and here's why during the third year after the due date her due date was october fifteenth two thousand and thirteen the third year after the due date commenced on october fifteenth two t fifteen and ended on october twenty fourth twenty sixteen the notice was not mailed during that period the only way the tax payer prevails is if she convinces the court that if you're doing the same thing again you're saying you're saying it's due date with extensions where and it can easily be read as during the third year after the due date the extensions right but the due date is set doesn't say where you stick the extensions ok but even if you stick it up front the due date for her return in my mind was oct fifteenth that's if you stick it up front but if you stick it in the back that was the purpose of the standard for so and i see that i'm out of time but i just i just want to point out if the statute had men do date without extensions right congress knows how to do that because in the very next section sixty five thirteen a it says for purposes of this subsection the last day prescribe or filing the return shall be termed determined without regard to any extension of time granted the taxpayer look let me ask you this absent that the due date is the extended today suppose under your analysis the the notice of deficiency is sent after two years and nine month s can the taxpayer recover the an overpayment we had made yes but then but then the press would have to look back more than three years yes you have to look back with three years because you have six months plus year one plus year two plus nine months of year three now you're looking back more than three years what i mean you're saying to two years and nine months at the due date as  extended that's correct i don't know you're saying and extra i think after the due date as it exists or the time two years and nine months you don't get that then looks like they don't get the third year at all because they only get half that their year because because six months of that three year period has already been used up in the extension period which doesn't do anything except create the black hole that's where you are you wouldn't  or more the three or look back three years is thirty six months right so if you if you take a two years six month extension  plus nine months of year three you you can't look back three years in other words it looks like your reading of this thing creates a shambles frankly you know you can look back three years you get you can look back three years but if the deficiency is served in in the ninth month of what you're calling year three you can't look back to the to the to the dat i mean saying that you're describing if your analysis you're talking about three years plus six months at the front and that's all very well except that if the if if they notice a deficiency is sent out in the three years you look back three years but if the notice of deficiency is served in the ninth month when you're calling your three you can't look back that far because that gets to be forty two months instead of thirty six months so the look back period is so you look back period means that any taxes paid during that look back period may be refunded that's right under my reading and your have i thought a call any taxes paid during the three year period are refundable the problem would be is that this taxpayer wouldn't be able to recover because her payments were made right prior not that concerned about this tax payer i'm concerned about reading a statute and under your reading of it the third year granted by congress would only be six months long because you can only look back three years that is to say thirty six months that's not true that's because you would still look back three years and get the payments during that three year period yes but the three year period would be good six months later and right after almost everybody has paid their taxes ok yes that's correct most people pay their taxes prior to the return today yes but if you get an extension you may you know you may pay later you may pay later and then you know then you're not really going to be able to look back the full three years with with extensions on that if you pay on the extended due date you will get it back you would get that back and you would be within a three year period whereas under taxpayer's reading reading you wouldn't get back what you paid on the extended do that i was never that great on a writ for under one hundred i think i can manage it and if you are and if if if and if the notice of deficiency is in the ninth month of what you are calling your three you get to look back thirty six months and that means that any payment made in the extension period cannot be reached by looking back thirty six months right i i'm trying to understand thank you very much all right thank you thank you we we will reserve decision the last case on calendars united states versus adams which we have taken on submission that's the last case on calendar plea