Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_05-cv-02243/USCOURTS-casd-3_05-cv-02243-0/pdf.json

Nature of Suit Code: 870
Nature of Suit: Tax Suits
Cause of Action: 26:7401 IRS: Tax Liability

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1

 There is no dispute that, despite the difference in the spelling of her first name, petitioner

Susi M. Boynton in the Tax Court case is the same person as Defendant Susan M. Boynton in this

case.

- 1 - 05-CV-2243 WQH (RBB)

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

UNITED STATES OF AMERICA,

Plaintiff,

CASE NO. 05-CV-2243-WQH (RBB)

ORDER GRANTING PLAINTIFF’S

MOTION FOR SUMMARY

JUDGMENT

[D.E. 20.]

vs.

SUSAN M. BOYNTON,

Defendant.

HAYES, Judge:

I. Background

On December 9, 2005, the United States filed the above-captioned action to reduce to

judgment federal income tax assessments for the 1982 tax year against Defendants Warren K. Boynton

(“Mr. Boynton”) and Susan M. Boynton (“Ms. Boynton”). In its Complaint, the United States seeks

to reduce to judgment assessments, penalties and interest totaling $13,364,973.63 as of August 31,

2005. (Compl. ¶ 9.) Defendants’ federal income tax liabilities for the 1982 tax year were previously

adjudicated on a petition to the United States Tax Court, which entered judgment against Defendants

on September 22 1993. See Cramer v. Comm’r, 101 T.C. 225 (1993) (consolidating petitions of

Warren K. and Susi M. Boynton,1

 among others, and entering decision for the Commissioner of

Internal Revenue). The judgment was affirmed by the Ninth Circuit on September 11, 1995. See

Cramer v. Comm’r, 64 F.3d 1406 (9th Cir. 1995). As Mr. Boynton and Ms. Boynton filed a joint

income tax return in 1982, they were found to be jointly and severally liable for the full amount due.

Case 3:05-cv-02243-WQH-RBB Document 26 Filed 02/02/07 Page 1 of 7
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

2

 In her Answer, in addition to raising the § 6015 “innocent spouse” defense, Ms. Boynton

asserted that the United States’ claim to reduce Ms. Boynton’s 1982 income tax assessments to

judgment is barred by the applicable 10-year statute of limitations. (Answer at 3.) However, Ms.

- 2 - 05-CV-2243 WQH (RBB)

See id. at 1410. The United States has been collecting on the assessments for more than 10 years.

(Decl. Justin S. Kim (“Kim Decl.”), Ex. 1.) According to the United States, this action to reduce the

assessments to judgment was filed in order to extend the statute of limitations under 26 U.S.C. §

6502(a) (imposing a 10-year period of limitations on collection after assessment unless “a timely

proceeding in court for the collection of a tax is commenced”). (Mem. Supp. Mot. Summ. J. at 1-2.)

On March 1, 2006, this Court entered a stipulated Judgment against Mr. Boynton for the full

amount sought by the Complaint. (D.E. 4.) On October 30, 2006, the United States filed its Motion

for Summary Judgment against Ms. Boynton. (D.E. 20.) Ms. Boynton filed a Response in Opposition

to the Motion on December 21, 2006 (D.E. 22) and the United States filed its Reply on December 29,

2006 (D.E. 23). On January 8, 2007, this Court heard oral argument from counsel for both remaining

parties.

II. Legal Standard

Summary judgment is appropriate under Federal Rule of Civil Procedure 56 where the moving

party demonstrates the absence of a genuine issue of material fact and entitlement to judgment as a

matter of law. See Fed. R. Civ. P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).

A fact is material when, under the governing substantive law, it could affect the outcome of the case.

See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute over a material fact is

genuine if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.”

Id.

III. Discussion

The United States seeks summary judgment against Ms. Boynton for the federal income tax

assessments for the 1982 tax year. Ms. Boynton concedes that there can be no dispute as to the

amount due, as the amount was determined by the Tax Court and affirmed by the Ninth Circuit. See

Cramer v. Comm’r, 101 T.C. 225 (1993), aff’d, 64 F.3d 1406 (9th Cir. 1995). However, Ms. Boynton

contends that there exists a genuine issue of fact as to whether she is eligible for relief from liability

as an “innocent spouse,” pursuant to 26 U.S.C. § 6015.2

Case 3:05-cv-02243-WQH-RBB Document 26 Filed 02/02/07 Page 2 of 7
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Boynton did not raise this statute of limitations argument in her opposition brief to the United States’

summary judgment motion. Hence, this argument has been waived. See In re Home Am.

T.V.-Appliance Audio, Inc., 232 F.3d 1046, 1052 (9th Cir. 2000) (citing Alexopulos v. Riles, 784 F.2d

1408, 1411 (9th Cir.1986) (holding that plaintiff’s tolling argument was waived for failure to raise the

issue in opposition to summary judgment even though the general statute of limitations issue had been

briefed)).

Even if Ms. Boynton had not waived the argument, it would have been rejected. Under 26

U.S.C. § 6502(a), a proceeding to collect taxes must be brought “within 10 years after the assessment

of the tax.” Section 6503(h) suspends the period of limitations under § 6502 during the pendency of

a Chapter 11 bankruptcy case and for six months thereafter. According to the undisputed evidence,

the applicable assessments against Ms. Boynton were made on March 28, 1994. (Kim Decl. ¶ 2, Ex.

1 at 2-3 & Ex. 2 at 1.) On April 5, 1994, Defendant filed a Chapter 11 petition, which was not

dismissed until July 13, 1995. See In re Boynton, 184 B.R. 580 (Bankr. S.D. Cal. 1995). The period

of limitations under § 6502 was stayed from April 5, 1994 to January 15, 1996 (i.e., six months after

July 15, 1995), for a total of 648 days. The 10-year period under § 6502(a) did not expire until

January 5, 2006 (10 years and 648 days from March 28, 1994). Thus, this action was timely

commenced on December 9, 2005.

3

 The specific requirements of each subsection are not relevant to the issues decided in this

Order.

- 3 - 05-CV-2243 WQH (RBB)

The innocent spouse exemption, codified at 26 U.S.C. § 6015, “was ... developed in an effort

to offer some protection to a spouse who, through no fault of their own, did not have any knowledge

of the incorrect tax reporting of the other spouse.” In re French, 242 B.R. 369, 376 (Bankr. N.D. Ohio

1999). More specifically, § 6015 encompasses three types of relief, each with their own specific

requirements: (1) subsection (b) provides full or apportioned relief from joint and several liability; (2)

subsection (c) provides proportionate tax relief to divorced or separated taxpayers; and, (3) subsection

(f) provides equitable relief from joint and several liability in certain circumstances if relief from

neither subsection (b) nor subsection (c) is available. See 26 U.S.C. § 6015.3 Ms. Boynton contends

that she is entitled to relief under each of these three subsections. 

The United States responds that summary judgment is appropriate for three independent

reasons: (1) this Court lacks jurisdiction to adjudicate relief under § 6015 or to review the

Commissioner’s determination of whether to grant or deny relief under § 6015; (2) Ms. Boynton has

failed to exhaust her administrative remedies under § 6015; and, (3) Ms. Boynton’s request for relief

under § 6015 is untimely.

In this case, the Court’s analysis begins and ends with jurisdiction. “The district courts of the

United States ... are courts of limited jurisdiction. They possess only that power authorized by

Constitution and statute.” Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 125 S. Ct.

Case 3:05-cv-02243-WQH-RBB Document 26 Filed 02/02/07 Page 3 of 7
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

4

 The applicable regulation further provides:

To elect the application of § [6015(b)] or [6015(c)], or to request equitable relief under

§ [6015(c)], a requesting spouse must file Form 8857, ‘Request for Innocent Spouse

Relief’ (or other specified form); submit a written statement containing the same

information required on Form 8857, which is signed under penalties of perjury; or

submit information in the manner prescribed by the Treasury and IRS in forms,

relevant revenue rulings, revenue procedures, or other published guidance....

26 C.F.R. § 1.6015-5(a).

- 4 - 05-CV-2243 WQH (RBB)

2611, 2616-17 (2005) (quotation omitted).

In order to address the United States’ claim that this Court lacks jurisdiction to consider Ms.

Boynton’s § 6015 claim, it is first necessary to consider the statutory scheme for innocent spouse

relief. Although not a model of clarity, § 6015 and the related regulations envision a process whereby

a person claiming innocent spouse relief first does so with the Secretary of the Treasury (“Secretary”),

pursuant to procedures established by the Secretary. Section 6015 repeatedly states that its provisions

are to be effectuated “[u]nder procedures prescribed by the Secretary.” 26 U.S.C. §§ 6015(b)(1) &

6015(f); see also § 6015(d)(3)(B) (“[u]nder rules prescribed by the Secretary”); § 6015(h) (“The

Secretary shall prescribe such regulations as are necessary to carry out the provisions of this

section....”). Among the procedures prescribed by the Secretary is the requirement that in order to

elect the application of any of the three types of relief provided by § 6015 (i.e., subsections (b), (c)

and (f)), “a requesting spouse must file Form 8857 or other similar statement with the Internal

Revenue Service no later than two years from the date of the first collection activity against the

requesting spouse after July 22, 1998, with respect to the joint tax liability.” 26 C.F.R. § 1.6015-5(b).4

Section 6015 also contains provisions for judicial review of the Secretary’s § 6015

determinations: “In addition to any other remedy provided by law, the individual may petition the Tax

Court (and the Tax Court shall have jurisdiction) to determine the appropriate relief available to the

individual under this section....” 26 U.S.C. § 6015(e)(1)(A). Only the Court of Appeals may then

review the decisions of the Tax Court. See 26 U.S.C. § 7482(a)(1) (“The United States Courts of

Appeals ... shall have exclusive jurisdiction to review the decisions of the Tax Court....”); cf.

Pietromonaco v. Comm’r, 3 F.3d 1342, 1344 (9th Cir. 1993) (“We review for clear error the Tax

Court’s determination that Mrs. Capehart was not entitled to innocent spouse relief under §§ 6015(b)

Case 3:05-cv-02243-WQH-RBB Document 26 Filed 02/02/07 Page 4 of 7
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

5

 Subsection 6015(e)(3) provides, in full:

If a suit for refund is begun by either individual filing the joint return pursuant to

section 6532--

(A) the Tax Court shall lose jurisdiction of the individual’s action

under this section to whatever extent jurisdiction is acquired by the

district court or the United States Court of Federal Claims over the

taxable years that are the subject of the suit for refund, and

(B) the court acquiring jurisdiction shall have jurisdiction over the

petition filed under this subsection.

26 U.S.C. § 6015(e)(3). 

- 5 - 05-CV-2243 WQH (RBB)

and (c).”).

Section 6015 expressly contemplates District Court jurisdiction in only one instance: when the

taxpayer files a refund suit in District Court (as authorized by 26 U.S.C. §§ 6532 and 7422) while a

§ 6015 petition is pending with the Tax Court. See 26 U.S.C. § 6015(e)(3).5 In that instance, the Tax

Court is divested of jurisdiction to decide the § 6015 petition. See 26 U.S.C. § 6015(e)(3)(A). By

contrast, in an action such as the instant one, where the United States initiates a suit to reduce

assessments to judgment, § 6015 contains no express provision granting District Court jurisdiction to

decide the innocent spouse issue.

Ms. Boynton argues that district court jurisdiction is contemplated by the introductory phrase

in the judicial review subsection of § 6015: “[i]n addition to any other remedy provided by law, the

individual may petition the Tax Court (and the Tax Court shall have jurisdiction) to determine the

appropriate relief available to the individual under this section....” 26 U.S.C. § 6015(e)(1)(A)

(emphasis added). She contends that employing the innocent spouse provision as an affirmative

defense in a suit such as this, is an example of an “other remedy provided by law.” (Def.’s Mem.

Opp’n Mot. Summ. J. at 6.) While Ms. Boynton points to no case expressly making such a holding,

or even considering the issue, she does note three instances where District Courts adjudicated a

taxpayer’s innocent spouse defense--without discussion of the jurisdiction issue. See U.S. v. Haag,

No. Civ. 02-12490, 2004 WL 2650274 (D. Mass., Sept. 30, 2004); Jones v. U.S., 322 F. Supp. 2d 1025

(D.N.D. 2000); see also U.S. v. Shanbaum, 10 F.3d 305 (5th Cir. 1994) (affirming a District Court’s

decision that a wife should be relieved of her tax liability under the previous innocent spouse

provision, 26 U.S.C. § 6013).

By contrast, the United States emphasizes the single decision where this issue was considered,

Case 3:05-cv-02243-WQH-RBB Document 26 Filed 02/02/07 Page 5 of 7
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 6 - 05-CV-2243 WQH (RBB)

United States v. Feda, No. 05 C 1767, 2006 WL 897887 (N.D. Ill., Apr. 3, 2006). In Feda, the United

States challenged the innocent spouse affirmative defense on jurisdictional grounds and prevailed.

The court concluded that “the district court is not the proper location to introduce an innocent spouse

theory.” Id. at *4. The court granted summary judgment to the United States on its complaint to

reduce plaintiff’s federal tax assessments to judgment, noting that the taxpayer “may attempt to seek

innocent spouse relief in the proper location for the tax years that are not yet barred by the statute’s

limitation period.” Id. at *5.

The result reached in Feda appears to be the proper one, considering the statutory scheme. As

detailed supra, the innocent spouse provision and the related regulations require a taxpayer claiming

innocent spouse relief to first do so with the Secretary; then, after the Secretary makes a final

determination (or fails to make a final determination within six months), the taxpayer may appeal to

the Tax Court. See 26 U.S.C. § 6015(e)(1)(A). Thereafter, appeal of the Tax Court decision may be

taken to the Court of Appeals. See 26 U.S.C. § 7482(a)(1). In the one instance where § 6015 grants

district court jurisdiction to decide the innocent spouse issue (inapplicable here), the Tax Court is

expressly divested of jurisdiction to decide the § 6015 petition. See 26 U.S.C. § 6015(e)(3)(A). By

contrast, if this Court were to accept Ms. Boynton’s invitation to find jurisdiction to decide the

innocent spouse issue from the language, “[i]n addition to any other remedy provided by law,” 26

U.S.C. § 6015(e)(1)(A), there would be no statutory limitation on Tax Court jurisdiction to decide the

same issue. On October 16, 2006, Ms. Boynton filed a Request for Innocent Spouse Relief, I.R.S.

Form 8857, with the Secretary. (Boynton Decl. ¶14, Ex. 3.) This initiated the administrative

consideration of Ms. Boynton’s innocent spouse claim. Barring abstention by one court or the other,

it appears entirely possible that under Ms. Boynton’s reading of § 6015, this Court and the Tax Court

would be adjudicating precisely the same issues at the same time. It is difficult to believe that

Congress would have created a situation fraught with possibilities for inconsistent judgments and

contrary to basic principles of judicial economy with the phrase, “[i]n addition to any other remedy

provided by law.” This seems especially true when Congress was careful to avoid concurrent

jurisdiction in the one instance when district court jurisdiction is expressly granted over the innocent

spouse exemption.

Case 3:05-cv-02243-WQH-RBB Document 26 Filed 02/02/07 Page 6 of 7
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

6

 In its briefing, the United States asserted: “[E]ntry of judgment against Defendant in this

action would not prejudice her administrative request for relief if the Court holds that it lacks

jurisdiction to consider § 6015 as an affirmative defense. Then her request for administrative request

would go forward with the IRS.” (Reply Mem. at 5.)

- 7 - 05-CV-2243 WQH (RBB)

This Court finds, based upon the language of § 6015 and the related regulations and statutory

scheme, that “[t]he proper location to obtain innocent spouse relief is not initially in the district

courts.” Feda, 2006 WL 897887, at *3. As the Feda court noted in a similar situation, granting

summary judgment in favor of the United States--accompanied by a finding that the Court lacks

jurisdiction to consider the § 6015 defense--does not inhibit the taxpayer’s ability to seek innocent

spouse relief first with the Secretary and then, if appropriate, with the Tax Court and the Court of

Appeals. This result gives the Secretary the first opportunity to hear Ms. Boynton’s innocent spouse

claim, as § 6015 envisions. Then she will have the opportunity to seek judicial review of the

Secretary’s decision with the Tax Court, as set forth in § 6015.6 

Finally, as the Court has determined that it lacks the jurisdiction to consider the merits of Ms.

Boynton’s § 6015 innocent spouse claim, the Court makes no findings regarding the United States’

other arguments, most notably, that Ms. Boynton’s request for § 6015 relief is untimely. Those

arguments are left for a time when Ms. Boynton pursues her claim for § 6015 innocent spouse relief

in the proper forum. 

IV. Conclusion

For the reasons discussed above, the United States’ Motion for Summary Judgment (D.E. 20)

is GRANTED. The Court finds that it lacks jurisdiction over Defendant Susan M. Boynton’s claim

for innocent spouse relief pursuant to 26 U.S.C. § 6015. The Clerk of the Court is ORDERED to

enter judgment in favor of Plaintiff United States of America and against Defendant Susan M.

Boynton.

IT IS SO ORDERED.

DATED: February 1, 2007

WILLIAM Q. HAYES

United States District Judge

Case 3:05-cv-02243-WQH-RBB Document 26 Filed 02/02/07 Page 7 of 7