FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA, 

Plaintiff-Appellant, 

 v. 

JAMES D. PAULSON, individually; 

and as statutory executor of the Estate 

of Allen E. Paulson; VIKKI E. 

PAULSON, individually; and as 

statutory executor of the Estate of 

Allen E. Paulson; and as Co-Trustee of 

the Allen E. Paulson Living Trust; 

CRYSTAL CHRISTENSEN, 

individually; and as statutory executor 

of the Estate of Allen E. Paulson; and 

as Co-Trustee of the Allen E. Paulson 

Living Trust; MADELEINE 

PICKENS, individually; and as 

statutory executor of the Estate of 

Allen E. Paulson; and as Trustee of the 

Marital Trust created under the Allen 

E. Paulson Living Trust; and as 

Trustee of the Madeleine Anne 

Paulson Separate Property Trust, 

Defendants-Appellees.

No. 21-55197 

D.C. No. 

3:15-cv-02057-

AJB-NLS 

OPINION
2 UNITED STATES V. PAULSON

UNITED STATES OF AMERICA, 

Plaintiff-Appellee, 

 v. 

JOHN MICHAEL PAULSON, 

individually; and as Executor of the 

Estate of Allen E. Paulson; JAMES D. 

PAULSON, individually; and as 

statutory executor of the Estate of 

Allen E. Paulson, MADELEINE 

PICKENS, individually; and as 

statutory executor of the Estate of 

Allen E. Paulson; and as Trustee of the 

Marital Trust created under the Allen 

E. Paulson Living Trust; and as 

Trustee of the Madeleine Anne 

Paulson Separate Property Trust, 

Defendants, 

and 

VIKKI E. PAULSON, individually; 

and as statutory executor of the Estate 

of Allen E. Paulson; and as Co-Trustee 

of the Allen E. Paulson Living Trust; 

CRYSTAL CHRISTENSEN, 

individually; and as statutory executor 

of the Estate of Allen E. Paulson; and 

as Co-Trustee of the Allen E. Paulson 

No. 21-55230 

D.C. No. 

3:15-cv-02057-

AJB-NLS 
UNITED STATES V. PAULSON 3 

Living Trust, 

 Defendants-Appellants. 

Appeal from the United States District Court

for the Southern District of California

Anthony J. Battaglia, District Judge, Presiding 

Argued and Submitted February 11, 2022 

San Francisco, California

Filed May 17, 2023 

Before: Kim McLane Wardlaw, Sandra S. Ikuta, and 

Bridget S. Bade, Circuit Judges. 

Opinion by Judge Bade; 

Dissent by Judge Ikuta 

SUMMARY*

Tax

The panel reversed the district court’s judgment in favor 

of defendants, and remanded with instructions to enter 

judgment in favor of the government on its claims for estate 

taxes, and to conduct any further proceedings necessary to 

* This summary constitutes no part of the opinion of the court. It has 

been prepared by court staff for the convenience of the reader.
4 UNITED STATES V. PAULSON

determine the amount of each defendant’s liability for 

unpaid taxes.

The United States sued several heirs of Allen Paulson, 

alleging that they were trustees of Paulson’s trust or received 

estate property as transferees or beneficiaries, and were thus 

personally liable for estate taxes under 26 U.S.C. 

§ 6324(a)(2). The United States also alleged that two of the 

heirs, Vikki Paulson and Crystal Christensen, were liable for 

estate taxes under California state law. The district court 

ruled in favor of defendants on the Tax Code claims, and in 

favor of the United States on the state law claims.

Allen Paulson died with an estate valued at nearly $200 

million, most of which was placed in a living trust. The 

estate was distributed among Paulson’s heirs over the years. 

When the estate filed its tax return, it also paid a portion of 

its tax liability, and elected to pay the remaining balance in 

installments with a fifteen-year plan under 26 U.S.C. § 6166. 

After the estate missed some payments, the Internal Revenue 

Service terminated the § 6166 election and issued a notice of 

final determination under 26 U.S.C. § 7479. The IRS then 

recorded notices of federal tax liens against the estate. In the 

meantime, the various beneficiaries of the living trust settled 

their disputes, after which they claimed that the living trust 

had been “completely depleted.”

The United States filed an action against the 

beneficiaries, seeking a judgment against the estate and 

living trust for the outstanding balance of the estate’s tax 

liability. The United States also sought judgment against the 

individual defendants under 26 U.S.C. § 6324(a)(2), 

31 U.S.C. § 3713, and state law. The district court concluded 

that defendant Madeleine Pickens was not liable for the 

unpaid estate taxes as a beneficiary of the living trust, and 
UNITED STATES V. PAULSON 5

that the remaining defendants were not liable for estate taxes 

as transferees or trustees because they were not in possession 

of estate property at the time of Allen Paulson’s death.

The panel held that § 6324(a)(2) imposes personal 

liability for unpaid estate taxes on the categories of persons 

listed in the statute who have or receive estate property, 

either on the date of the decedent’s death or at any time 

thereafter (as opposed to only on the date of death), subject 

to the applicable statute of limitations. The panel next held 

that the defendants were within the categories of persons 

listed in § 6324(a) when they had or received estate property, 

and are thus liable for the unpaid estate taxes as trustees and 

beneficiaries. The panel further held that each defendant’s 

liability cannot exceed the value of the estate property at the 

time of decedent’s death, or the value of that property at the 

time they received or had it as trustees and beneficiaries. The 

panel did not reach the state law claims, because its 

conclusion on the federal tax claims resolved the matter.

Judge Ikuta dissented. Disagreeing with the majority’s 

statutory interpretation, she explained that the taxpayers’ 

reading of the statute is more plausible, avoids an illogical 

result (namely, that a person who receives estate property 

years after the estate is settled could be held personally liable 

for estate taxes that potentially exceed the current value of 

the property received), and is a better indication of 

Congress’s intent to impose such personal liability only on 

the date of the decedent’s death.
6 UNITED STATES V. PAULSON

COUNSEL

Lauren E. Hume (argued), Joan I. Oppenheimer, and Ivan C. 

Dale, Attorneys; David A. Hubbert, Acting Assistant 

Attorney General; Tax Division, United States Department 

of Justice; Washington, D.C.; Randy S. Grossman, Acting 

United States Attorney; Office of the United States Attorney; 

Washington, D.C.; for Plaintiff-Appellant/Cross-Appellee.

Glen A. Stankee (argued), Akerman LLP, Fort Lauderdale, 

Florida; Katherine E. Giddings, Akerman LLP, Tallahassee, 

Florida; Donald N. David, Akerman LLP, New York, New 

York; Joshua R. Mandell, Akerman LLP, Los Angeles, 

California; Lisa M. Coyle, Blank Rome LLP, New York, 

New York; for Defendant-Appellee Madeleine Pickens.

John C. Maloney Jr. (argued), Zuber Lawler LLP, New 

York, New York, for Defendants-Appellees/CrossAppellants Vikki E. Paulson and Crystal Christensen.

James D. Paulson, Woodland Hills, California, pro se 

Defendant-Appellant.
UNITED STATES V. PAULSON 7

OPINION

BADE, Circuit Judge:

Allen Paulson died with an estate valued at nearly $200 

million, with most of his assets placed in a living trust. But 

years later more than $10 million in estate taxes, interest, and 

penalties remained unpaid. The United States of America 

(the United States or the government) sued several of 

Paulson’s heirs—John Michael Paulson, James D. Paulson, 

Vikki E. Paulson, Crystal Christensen, and Madeleine 

Pickens—alleging that they controlled the trust, as trustees,

or received estate property, as transferees or beneficiaries, 

and thus are personally liable for the estate taxes under 

§ 6324(a)(2) of the Internal Revenue Code, 26 U.S.C. 

§ 6324(a)(2). The United States also alleged that Vikki 

Paulson and Crystal Christensen, as co-trustees of the living 

trust, were liable for unpaid estate taxes under section 19001 

of the California Probate Code.

As relevant to this appeal, the district court granted in 

part Vikki Paulson’s Crystal Christensen’s, and Madeleine 

Pickens’s motions to dismiss, concluding that they were not 

liable for the estate taxes under § 6324(a)(2) as trustees, 

transferees, or beneficiaries, and later ruled on several 

motions for summary judgment. Based on the reasoning in 

its order granting the motions to dismiss in part, the court 

ruled in favor of Madeleine Pickens and James Paulson on 

the United States’ remaining claims under § 6324(a)(2), 

concluding that they were not personally liable for the estate 

taxes. The court entered summary judgment in favor of the 

United States on its claims under the California Probate 

Code. The United States appeals the rulings in favor of the

defendants on the § 6324(a)(2) claims, and Vikki Paulson 
8 UNITED STATES V. PAULSON

and Crystal Christensen cross-appeal the judgment holding 

them liable for the unpaid estate taxes under section 19001.1

We have jurisdiction over these appeals under 28 U.S.C. § 

1291.

We hold that § 6324(a)(2) imposes personal liability for 

unpaid estate taxes on the categories of persons listed in the 

statute who have or receive estate property, either on the date 

of the decedent’s death or at any time thereafter, subject to 

the applicable statute of limitations. We further hold that the 

defendants were within the categories of persons listed in 

§ 6324(a) when they had or received estate property, and 

thus are liable for the unpaid estate taxes as trustees and 

beneficiaries. Therefore, we reverse the district court’s 

judgment in favor of the defendants on the United States’

claims under § 6324(a)(2), and remand to the district court 

with instructions to enter judgment in favor of the

government on these claims with any further proceedings 

necessary to determine the amount of each defendant’s 

liability for the unpaid taxes. Because our conclusion on the 

federal tax claims arising from the Internal Revenue Code 

resolves this matter, we do not reach the parties’ dispute over 

the interpretation of the California Probate Code.

I

A

Allen Paulson died on July 19, 2000. He was survived 

by his third wife Madeleine Pickens, three sons from a prior 

1

 The district court concluded that John Michael Paulson was liable for 

the unpaid estate taxes as executor and trustee of the living trust, but 

concluded that he had successfully discharged his liability for the estate 

taxes under 26 U.S.C. § 2204. The United States does not dispute that 

finding on appeal. Therefore, only its claims against James Paulson, 

Vikki Paulson, Crystal Christensen, and Madeleine Pickens are at issue.
UNITED STATES V. PAULSON 9

marriage—Richard Paulson, James Paulson, and John 

Michael Paulson—and several grandchildren, including 

Crystal Christensen. Richard Paulson died after his father, 

and Vikki Paulson is Richard Paulson’s widow. At the time 

of Allen Paulson’s death, his gross estate was valued at 

$193,434,344 for federal estate tax purposes. Nearly all his 

assets, which included real estate, stocks, bonds, cash, and 

receivables, were held in a living trust.2

 The living trust was 

revocable during Allen Paulson’s lifetime and, according to 

its terms, the trust was to pay any estate taxes.

When Allen Paulson died, his son John Michael Paulson 

became a co-trustee of the living trust and was appointed coexecutor by the probate court. In October 2001, John 

Michael Paulson became the sole executor of the estate, with 

a different co-trustee. That same month, he filed an estate 

tax return, or Form 706, with the Internal Revenue Service 

(IRS). On October 23, 2001, the IRS received the estate’s 

Form 706 estate tax return, which reported a total gross 

estate of $187,729,626, a net taxable estate of $9,234,172, 

and an estate tax liability of $4,459,051. The estate paid 

$706,296 with the return and elected to defer the remaining 

balance of $3,752,755 to be paid in installments with a 

fifteen-year plan under 26 U.S.C. § 6166.3 In November 

2 The only asset that was not held by the living trust was an ownership 

interest in a hotel and casino corporation, which is not relevant to these 

appeals.

3 Under § 6166, an executor may pay a portion of the estate taxes in 

installments when more than 35% of the estate’s value consists of 

interest in a closely held business. 26 U.S.C. § 6166(a)(1), (3). This 

election is limited to the portion of the estate taxes attributable to the 

interest in a closely held business. Id. § 6166(a)(2). Section 6166 allows 

the executor to make interest payments for five years and then pay the 

taxes over ten years. Id. § 6166(a)(3), (f).
10 UNITED STATES V. PAULSON

2001, the IRS assessed the reported estate tax liability of 

$4,459,051.

The IRS audited the estate tax return and asserted a 

deficiency in the estate tax reported on the return, which the 

estate challenged in Tax Court. In December 2005, the Tax 

Court entered a stipulated decision and determined that the 

estate owed an additional $6,669,477 in estate taxes. The 

IRS assessed the additional liability in January 2006, and the 

estate elected to pay this amount through the remaining § 

6166 installments. John Michael Paulson, as executor, made 

interest installment payments until his removal as Trustee in 

2009, and he timely made the first estate tax and interest 

payment in April 2007. He obtained a one-year extension, 

until April 2009, to make the 2008 tax and interest payment. 

But neither he nor anyone else made that payment or any of 

the subsequent installment payments.4

Meanwhile, various disputes arose between Madeleine 

Pickens and Allen Paulson’s other heirs. In settlement of 

those disputes, Madeleine Pickens received assets that the 

government asserts were worth approximately $19 million, 

including $750,000 in cash, two residences and the personal 

property located at those residences, and an ownership 

interest in the Del Mar Country Club.5 Vikki Paulson and 

Crystal Christensen assert that the assets Madeleine Pickens 

received were worth over $42 million. Madeleine Pickens 

does not state a value for the assets she received. In February 

4 After the estate’s default in 2009, the successor co-trustees of the living 

trust submitted two offers in compromise to the IRS, accompanied by 

non-refundable partial payments that the IRS applied to the estate taxes.

5 Allen Paulson’s living trust included provisions listing these two

residences as gifts to Madeleine (Paulson) Pickens, which she would 

receive if, among other conditions, she survived him by six months.
UNITED STATES V. PAULSON 11

2003, John Michael Paulson and the co-trustee transferred 

these assets from the living trust to Madeleine Pickens, as 

trustee of her personal living trust. Between 2003 and 2006, 

John Michael Paulson distributed at least $7,261,887 in cash 

from the living trust to other trust beneficiaries, including 

$990,125 to Crystal Christensen.6

In March 2009, the probate court removed John Michael 

Paulson as trustee of the living trust for misconduct and 

appointed Vikki Paulson and James Paulson as co-trustees. 

The government asserts that, at that time, the trust contained 

assets worth more than $13.7 million, which exceeded the 

estate tax liability. Vikki Paulson and Crystal Christensen 

claim that by this time the living trust was insolvent, with 

$10.8 million in assets, but $28.3 million in liabilities, 

including $9.6 million in federal tax liability.

In May 2010, because of the missed installment 

payments, the IRS terminated the § 6166 election and issued 

a notice of final determination under 26 U.S.C. § 7479. The 

probate court removed James Paulson as co-trustee, and 

Vikki Paulson, as sole trustee of the living trust, challenged 

the IRS’s termination of the § 6166 election in the Tax Court. 

In May 2011, the Tax Court sustained the IRS’s termination 

of the estate’s installment payment election.

In February 2011, the probate court appointed Crystal 

Christensen co-trustee of the living trust with Vikki Paulson. 

At that time, according to the government, the living trust 

6 In his living trust, Allen Paulson bequeathed $1.4 million to Crystal 

(Paulson) Christensen to be held in trust until she reached the age of 18, 

with provisions that allowed for the trustee’s discretionary distributions 

of principal and set specific times (when Crystal Christensen turned 25, 

30, and 35 years old) for mandatory disbursements and the termination 

of the trust.
12 UNITED STATES V. PAULSON

held assets worth at least $8.8 million. In June and July 

2011, the IRS recorded notices of federal tax liens against 

the estate under 26 U.S.C. §§ 6321, 6322, and 6323. In the 

meantime, between 2007 and 2013, various disputes arose 

between John Michael Paulson, Vikki Paulson, Crystal

Christensen, James Paulson, and others with interests in the 

living trust. In January 2013, they settled their disputes 

through an agreement in which John Michael Paulson 

received the living trust’s ownership interest in a jet project, 

the estate’s casino ownership interest, and certain tax losses

in exchange for resigning as executor. Vikki Paulson and 

Crystal Christensen assert that, by the time of this 

agreement, the living trust was “completely depleted.” The 

probate court adopted the settlement agreement.

B

In September 2015, the United States filed this action 

against John Michael Paulson, Madeleine Pickens, James 

Paulson, Vikki Paulson, and Crystal Christensen in their 

individual and representative capacities. The complaint

sought a judgment against the estate and the living trust for 

the outstanding balance of the 2006 estate tax liability, which 

then exceeded $10 million, as well as judgments against the 

individual defendants under § 6324(a)(2), 31 U.S.C. § 3713, 

and California law.

James Paulson, Vikki Paulson, Crystal Christensen, and 

Madeleine Pickens filed motions to dismiss and argued that 

they were not personally liable for the estate taxes under § 

6324(a)(2) as trustees, beneficiaries, or transferees of the 

living trust. The district court denied James Paulson’s 

motion to dismiss, and partially granted and partially denied 

Madeleine Pickens’s, Vikki Paulson’s, and Crystal 

Christensen’s motions to dismiss. The district court 
UNITED STATES V. PAULSON 13

concluded that Madeleine Pickens was not liable for the 

unpaid estate taxes as a beneficiary of the living trust 

because she did not receive life insurance benefits.7 The 

district court further concluded that James Paulson,8 Vikki 

Paulson, and Crystal Christensen were not liable for the 

unpaid estate taxes as transferees or trustees because they 

were not in possession of estate property at the time of Allen 

Paulson’s death.9

II

These appeals raise questions of statutory interpretation, 

which we review de novo. Mada-Luna v. Fitzpatrick, 813 

F.2d 1006, 1011 (9th Cir. 1987).

III

Section 2001 of the Internal Revenue Code imposes a tax 

on a decedent’s taxable estate, which the executor is required 

to pay. 26 U.S.C. §§ 2001(a), 2002. Section 6324, in turn, 

7 Madeleine Pickens also argued that she was not liable as trustee of her 

personal trust, and the district court granted summary judgment to her on 

this issue because she did not receive estate property until three years 

after Allen Paulson’s death. The district court, however, did not 

determine whether Madeleine Pickens could be a “trustee,” under § 

6324(a)(2), based on her role as a trustee of her separate personal trust. 

The government does not argue on appeal that Madeleine Pickens is 

liable for the estate taxes in her role as trustee of her separate personal 

trust. Therefore, we do not address this issue.

8 James Paulson did not appeal the district court’s orders.

9 Vikki Paulson and Crystal Christensen also argued that they were not 

liable under California law. After discovery, the district court granted 

summary judgment to the United States on its claims that Vikki Paulson 

and Crystal Christensen, as successor trustees of the living trust, were 

liable for the unpaid estate taxes under the California Probate Code. As 

previously stated, we do not address this issue of California law.
14 UNITED STATES V. PAULSON

operates to protect the government’s ability to collect estate 

and gift taxes. See 26 U.S.C. § 6324(a); see also United 

States v. Vohland, 675 F.2d 1071, 1076 (9th Cir. 1982) 

(“[Section] 6324 is structured to assure collection of the 

estate tax.”). To this end, the statute imposes a lien on the 

decedent’s gross estate for the unpaid estate taxes in 

§ 6324(a)(1) and imposes personal liability for such taxes on 

those who receive or have estate property in § 6324(a)(2).

10 

26 U.S.C. § 6324(a)(1) and (2); see also United States v. 

Geniviva, 16 F.3d 522, 524 (3d Cir. 1994) (explaining that §

6324(a)(2) “affords the Government a separate remedy 

against the beneficiaries of an estate when the estate divests 

itself of the assets necessary to satisfy its tax obligations”).

The statutory provision at issue here, § 6324(a)(2), as 

stated in its title, imposes personal liability on “transferees 

and others” who receive or have property from an estate. 

The statute provides that:

If the estate tax imposed by chapter 11 is not 

paid when due, then the spouse, transferee, 

trustee (except the trustee of an employees’ 

10 These statutory tools to guard against the risk of non-payment, while

complementary, have some important differences. Section 6324(a)(1) 

imposes “a lien upon the gross estate of the decedent for 10 years from 

the date of death,” in the amount of the unpaid estate tax. 26 U.S.C. § 

6324(a)(1). Unlike the general tax lien of §§ 6322 and 6323, the estate 

tax lien arises before the tax is assessed and is valid against most third 

parties even if notice of the lien is not recorded. See Detroit Bank v. 

United States, 317 U.S. 329, 336–37 (1943); Vohland, 675 F.2d at 1074–

76. In contrast, § 6324(a)(2) imposes personal liability for unpaid estate 

taxes, on those listed in the statute, for ten years after assessment, 26 

U.S.C. § 6502(a)(1), and that collection period is tolled by a § 6166 

election and other events. See 26 U.S.C. § 6503(a)(1), (d); see also id.

§§ 6213(a), 6331(k)(1).
UNITED STATES V. PAULSON 15

trust which meets the requirements of section 

401(a)), surviving tenant, person in 

possession of the property by reason of the 

exercise, nonexercise, or release of a power 

of appointment, or beneficiary, who receives, 

or has on the date of the decedent’s death, 

property included in the gross estate under 

sections 2034 to 2042, inclusive, to the extent 

of the value, at the time of decedent’s death, 

of such property, shall be personally liable 

for such tax.

26 U.S.C. § 6324(a)(2) (emphasis added). The question 

before us is whether the phrase “on the date of the decedent’s 

death” modifies only the immediately preceding verb “has,” 

or if it also modifies the more remote verb, “receives.”

The United States argues the limiting phrase “on the date 

of decedent’s death” modifies only the immediately 

preceding verb “has,” and not the more remote verb 

“receives.” Therefore, in its view, the statute imposes 

personal liability on those listed in the statute who (1) 

receive estate property at any time on or after the date of the 

decedent’s death, or (2) have estate property on the date of 

the decedent’s death. Thus, it contends, § 6324(a)(2) 

imposes personal liability for the unpaid estate taxes in this 

case on successor trustees and beneficiaries of the living 

trust, including those who have or received estate property 

after the date of decedent Allen Paulson’s death.

The defendants, in contrast, argue that the limiting 

phrase “on the date of the decedent’s death” modifies both 

the immediately preceding verb “has,” and the more remote 

verb “receives.” Thus, under their interpretation, the statute 

imposes personal liability for the unpaid estate taxes only on 
16 UNITED STATES V. PAULSON

those who receive or have property included in the gross 

estate on the date of the decedent’s death. But those who 

receive property from the estate at any point after the date of 

the decedent’s death have no personal liability for the unpaid 

estate taxes.

We conclude that the most natural reading of the 

statutory text, and other indicia of its meaning, supports the 

United States’ interpretation. Therefore, we hold that § 

6324(a)(2) imposes personal liability for unpaid estate taxes 

on the categories of persons listed in the statute who have or 

receive estate property, either on the date of the decedent’s 

death or at any time thereafter, subject to the applicable 

statute of limitations. 

A

“Statutory construction must begin with the language 

employed by Congress and the assumption that the ordinary 

meaning of that language accurately expresses the legislative 

purpose.” Engine Mfrs. Ass’n v. S. Coast Air Quality Mgmt. 

Dist., 541 U.S. 246, 252 (2004) (internal quotation marks 

omitted) (quoting Park ‘N Fly, Inc., v. Dollar Park & Fly, 

Inc., 469 U.S. 189, 194 (1985)); see also, e.g., Facebook, 

Inc. v. Duguid, 141 S. Ct. 1163, 1169 (2021) (explaining that 

when interpreting a statute, “[w]e begin with the text.”); 

United States v. Ron Pair Enters., Inc., 489 U.S. 235, 241 

(1989) (“The task of resolving the dispute over the meaning 

of [a statute] begins where all such inquiries must begin: 

with the language of the statute itself.”).

Here, the statutory text at issue states that a person (who 

fits within a category listed in the statute) “who receives, or 

has on the date of the decedent’s death, property included in 

the gross estate . . . shall be personally liable” for the unpaid 

estate tax. 26 U.S.C. § 6324(a)(2) (emphasis added). Thus, 
UNITED STATES V. PAULSON 17

in the disputed text the statute lists two verbs: “receives” and 

“has.” Id. These two verbs are in separate independent 

clauses, set off from each other by a comma and the 

conjunction “or.” See id. In addition, the first verb 

“receives” is set off from the limiting phrase (“on the date of 

the decedent’s death”) by a comma. A term or phrase “set 

aside by commas” and “separated . . . by [a] conjunctive 

word[]” from a limiting clause “stands independent of the 

language that follows.” Ron Pair Enters., 489 U.S. at 241.11 

Thus, the structure of § 6324(a)(2) supports the conclusion 

that “receives” stands independent of the language that 

follows, “on the date of the decedent’s death.” Therefore, 

this limiting phrase does not modify the remote verb 

“receives.” See id.

This reading of the statute is supported by the canon of 

statutory construction known as “the rule of the last 

antecedent.” The Supreme Court has long applied this 

“timeworn textual canon” to interpret “statutes that include 

a list of terms or phrases followed by a limiting clause,” 

11 In Ron Pair Enterprises, the Court considered whether § 506(b) of the 

Bankruptcy Code, 11 U.S.C. § 506(b), allowed the holder of an oversecured claim to recover, in addition to “interest on such claim,” fees, 

costs, or other charges. 489 U.S. at 241. The statute provided that 

“[t]here shall be allowed to the holder of such claim, interest on such 

claim, and any reasonable fees, costs or charges provided for under the 

agreement under which such claim arose.” Id. (quoting 11 U.S.C. 

§ 506(b)). The Court explained that “[t]he phrase ‘interest on such 

claim’ is set aside by commas, and . . . stands independent of the 

language that follows.” Id. Therefore, it is not “joined to the following 

clause so that the final ‘provided for under the agreement’ modifies it as 

well.” Id. at 242. The Court therefore concluded that “[b]y the plain 

language of the statute, the two types of recovery [(1) “interest on such

claim,” and (2) “reasonable fees, costs or charges provided for under the 

agreement”] are distinct.” Id. 
18 UNITED STATES V. PAULSON

Lockhart v. United States, 577 U.S. 347, 351 (2016). The 

“rule of the last antecedent” provides that “a limiting clause 

or phrase . . . should ordinarily be read as modifying only the 

noun or phrase that it immediately follows.”12 Id. (alteration 

in original) (quoting Barnhart v. Thomas, 540 U.S. 20, 26 

(2003)); see also id. (“[Q]ualifying words or phrases modify 

the words or phrases immediately preceding them and not 

words or phrases more remote, unless the extension is 

necessary from the context or the spirit of the entire writing.” 

(alteration in original) (quoting BLACK’S LAW DICTIONARY

1532–33 (10th ed. 2014))). The rule of the last antecedent 

supports the conclusion that the limiting phrase “on the date 

of the decedent’s death” modifies only the immediately 

preceding antecedent “has,” and not the more remote 

antecedent “receives.”

Vikki Paulson and Crystal Christensen, however, argue 

that we should apply the series-qualifier canon and conclude 

that the limiting phrase “on the date of the decedent’s death” 

modifies both the immediately preceding verb “has,” and the 

more remote verb, “receives.” The series-qualifier canon 

provides that “‘[w]hen there is a straight-forward, parallel 

construction that involves all nouns or verbs in a series,’ a 

modifier at the end of the list ‘normally applies to the entire 

12 In Lockhart, the Court applied the rule of the last antecedent to 

interpret 18 U.S.C. § 2252(b)(2), which increases the sentences of 

defendants if they have “a prior conviction . . . under the laws of any 

State relating to aggravated sexual abuse, sexual abuse, or abusive sexual 

conduct involving a minor or ward.” 577 U.S. at 350–52 (quoting 18 

U.S.C. § 2252(b)(2)). The Court concluded that the limiting phrase 

“involving a minor or ward” modified only the immediately preceding 

crime in the list of offenses, “abusive sexual conduct,” and did not 

modify the other listed crimes, “aggravated sexual abuse,” or “abusive 

sexual conduct.” Id. at 349.
UNITED STATES V. PAULSON 19

series.’” Facebook, 141 S. Ct. at 1169 (alteration in original) 

(quoting ANTONIN SCALIA & BRYAN A. GARNER, READING 

LAW: THE INTERPRETATION OF LEGAL TEXTS 147 (2012)).

In Facebook, the Court interpreted the Telephone 

Consumer Protection Act of 1991, 47 U.S.C. § 227(a)(1), 

and concluded that the series-qualifier canon suggested the 

most natural reading of the statute.13 141 S. Ct. at 1169–70 

& n.5. The Court focused on the statute’s syntax and 

punctuation, explaining that because the limiting phrase at 

issue (“using a random or sequential number generator”) 

immediately followed an integrated clause that contained the 

antecedents (“store or produce telephone numbers to be 

called”), and the limiting phrase was separated from the 

antecedents by a comma, the limiting phrase applied to all 

the antecedents, not just the immediately preceding one. Id.

at 1170; cf. United States v. Pritchett, 470 F.2d 455, 459 

(D.C. Cir. 1972) (applying rule of the last antecedent and 

explaining that if the limiting phrase were intended to apply 

to all categories of persons listed in the statute, the drafters 

would have included a comma “so as to separate it from the 

clause immediately preceding”). The Court also explained 

that applying the series-qualifier canon did not conflict with 

“the rule of the last antecedent,” which does not apply when 

a limiting phrase follows an integrated clause. Facebook, 

141 S. Ct. at 1170.

Here, however, the limiting phrase in § 6324(a)(2), “on 

the date of the decedent’s death,” is not separated from both 

antecedents by a comma, and it does not follow an integrated 

13 The statute at issue in Facebook, § 227(a)(1), defined an “automatic 

telephone dialing system” as “equipment with the capacity both to store 

or produce telephone numbers to be called, using a random or sequential 

number generator.” 141 S. Ct. at 1167 (quoting 47 U.S.C. § 227(a)(1)).
20 UNITED STATES V. PAULSON

clause that contains both antecedents. Instead, the limiting 

phrase is set off by commas with the immediate antecedent, 

“has,” from the rest of the sentence (“who receives, or has 

on the date of the decedent’s death, property included in the 

gross estate”). 26 U.S.C. § 6324(a)(2). Thus, the 

punctuation of § 6324(a)(2) does not support a reading that 

applies the limiting phrase to both the immediate and remote

antecedents.

Moreover, accepting the defendants’ interpretation

would require us to read the statute as if it were punctuated 

differently—to essentially rewrite the statute. Specifically, 

we would either need to read the statute as if the two verbs 

“receives” and “has” appeared together in an integrated 

clause and were separated from the limiting phrase by a 

comma (i.e., a person who receives or has, on the date of the 

decedent’s death, property included in the gross estate is 

liable for the unpaid estate taxes) or as if the statute included 

an additional comma that separated the limiting phrase from 

the antecedents (i.e., a person, who receives, or has, on the 

date of the decedent’s death, property included in the gross 

estate is liable for the unpaid estate taxes). Cf. In re 

Bateman, 515 F.3d 272, 277 (4th Cir. 2008) (reading a 

provision in the bankruptcy code so that “[n]o punctuation 

needs to be added or deleted” (internal quotation marks and 

citation omitted)). But Congress did not structure the statute 

this way. See Int’l Primate Prot. League v. Adm’rs of Tulane 

Educ. Fund, 500 U.S. 72, 79–80 (1991) (explaining that 

Congress would have added a comma if it had intended a 

meaning other than the natural reading);

14 see also In re 

14 In International Primate Protection League, the Court construed 28 

U.S.C. § 1442(a)(1) and concluded that the statute’s punctuation 
UNITED STATES V. PAULSON 21

Sanders, 551 F.3d 397, 400 (6th Cir. 2008) (“Congress no 

doubt could have worked around [the rule of the last 

antecedent] had it wished . . . .”).

We therefore conclude that the rule of the last antecedent 

is the canon of interpretation that is most consistent with the 

text, structure, and punctuation of § 6324(a)(2), and 

therefore it is the appropriate tool to interpret the statute.

B

This conclusion, however, does not end our inquiry. As 

the Court has explained, canons of statutory interpretation 

are not absolute and can be “overcome by other indicia of 

meaning.” Lockhart, 577 U.S. at 352 (citations omitted); see 

also Facebook, 141 S. Ct. at 1170 n.5 (“Linguistic canons 

are tools of statutory interpretation whose usefulness 

depends on the particular statutory text and context at 

issue.”). Here, however, applying the rule of the last 

antecedent results in an interpretation of § 6324(a)(2) that is 

supported by the statutory text and context, while applying 

the series-qualifier canon does not.

This is so because we are also bound by the canon that 

requires us to “strive to ‘giv[e] effect to each word and 

mak[e] every effort not to interpret a provision in a manner 

supported the conclusion that the phrase “Any officer of the United 

States or any agency thereof, or person acting under him,” did not permit 

agencies to remove civil suits from state to federal court. 500 U.S. at 

79–80. As the Court explained, “[i]f the drafters of § 1442(a)(1) had 

intended the phrase ‘or any agency thereof’ to describe a separate 

category of entities endowed with removal power, they would have 

likely employed the comma consistently.” Id. at 80. Thus, the Court 

concluded that “[a]bsent the comma, the natural reading of the clause is 

that it permits removal by anyone who is an ‘officer’ either ‘of the United 

States’ or of one of its agencies.” Id.
22 UNITED STATES V. PAULSON

that renders other provisions of the same statute inconsistent, 

meaningless or superfluous.’” R.J. Reynolds Tobacco Co. v. 

County of Los Angeles, 29 F.4th 542, 553 (9th Cir. 2022) 

(alterations in original) (quoting Shelby v. Bartlett, 391 F.3d 

1061, 1064 (9th Cir. 2004)). The defendants’ narrow 

interpretation of § 6324(a)(2), which limits personal liability 

for unpaid estate taxes to those who have or receive estate 

property on the date of the decedent’s death only, violates 

this canon because it conflicts with the plain meaning of the 

very next clause of the statute.

That clause applies § 6324(a)(2) to “property included in 

the gross estate under sections 2034 to 2042, inclusive.” 

These sections, in turn, attach personal liability for the 

unpaid estate taxes on the gross estate to assets that are 

receivable. See 26 U.S.C. § 2039(a) (incorporating “annuity 

or other payments receivable” into the gross estate); id.

§ 2041(a)(2) (incorporating property that a transferee may 

not receive by a power of appointment until after “notice” 

and the “expiration of a stated period”); id. § 2042 

(incorporating life insurance proceeds “[t]o the extent of the 

amount receivable”). Thus, the statute clearly anticipates 

that at the time of the decedent’s death, the categories of 

persons listed in the statute may receive the expectation of 

the right to receive certain estate property. Id. § 6324(a)(2). 

In other words, they may have a “receivable interest” on the 

date of the decedent’s death but not actually receive property 

on that date. See Receivable, BLACK’S LAW DICTIONARY

(11th ed. 2019) (defining “receivable” as “[a]waiting receipt 

of payment” or “[s]ubject to a call for payment”). Under the 

plain language of § 6324(a)(2), those who fit within the 

categories of persons listed in the statute are personally

liable for the estate taxes on such property.
UNITED STATES V. PAULSON 23

The statute also explicitly applies to those who already 

have or possess estate property on the date of the decedent’s 

death, such as a “surviving tenant” or a “person in possession 

of the property.” 26 U.S.C. § 6324(a)(2); see id.

(incorporating § 2040, which includes in the gross estate 

property that is held by the decedent and any other person

“as joint tenants with the right of survivorship”); see also 

United States v. Craft, 535 U.S. 274, 280–81 (2002) 

(explaining that certain tenancies enjoy the “right of 

survivorship,” which is a “right of automatic inheritance” 

such that “[u]pon the death of one joint tenant, that tenant’s 

share in the property does not pass through will or the rules 

of intestate succession; rather, the remaining tenant or 

tenants automatically inherit it”); Survivorship Tenancy,

BLACK’S LAW DICTIONARY (11th ed. 2019) (defining 

“survivorship tenancy” as “a tenancy in which the surviving 

tenant automatically acquires ownership of a deceased 

tenant’s share”).

Thus, the context and structure of the statute provide 

additional indicia of its meaning and further clarify that 

personal liability for the estate tax applies to those who 

receive estate property, on or after the date of the decedent’s 

death (i.e., through annuities, other receivable payments, 

powers of appointment, or insurance policies), and to those 

who have estate property on the date of the decedent’s death 

(e.g., through a survivorship tenancy).

Vikki Paulson and Crystal Christensen acknowledge that 

§ 6324(a)(2)’s definition of the “gross estate” includes 

property that the categories of persons listed in the statute 

will receive after the date of the decedent’s death, for 

example property received through the power of 

appointment described in § 2041. But they argue that the 

phrase “on the date of the decedent’s death” must be read “to 
24 UNITED STATES V. PAULSON

exclude certain assets that are part of the gross estate from 

the categories of assets that trigger personal liability.” Thus, 

even though the statute explicitly incorporates “sections 

2034 to 2042, inclusive” to define the “property included in 

the gross estate,” 26 U.S.C. § 6324(a)(2), the defendants

argue that we should nonetheless conclude that the receipt of 

such property does not subject the recipient to personal 

liability for unpaid estate taxes. They argue that because 

such property will not be received until after the date of the 

decedent’s death, the recipient “does not have ‘on the date 

of the decedent’s death’ an asset out of which that person can 

pay taxes, and so is not personally liable.” Thus, they 

conclude that “some assets included in the gross estate 

would not trigger liability under [§] 6324(a)(2).”

But the statute does not state that liability for unpaid 

estate taxes attaches only to those who can pay the taxes on 

the date of the decedent’s death. Instead, the statute imposes 

personal liability for the unpaid estate taxes based on the 

receipt or possession of property from the gross estate. See

26 U.S.C. § 6324(a)(2). And the tax code and regulations do 

not otherwise suggest that liability for estate taxes is related 

to the ability to pay the taxes on the date of the decedent’s 

death, but instead they provide for the collection of taxes 

after assessment and allow for extensions of time and 

installment payments. See 26 U.S.C. §§ 6161, 6166, 6502, 

and 26 C.F.R. § 20.6166A-3. Therefore, we find no support

in the text of the statute for the defendants’ argument.

Madeleine Pickens, on the other hand, argues that “[§§]

2039 and 2042 do not bring within the gross estate insurance 

proceeds and annuity payments received on the date of 

death, but rather insurance payments and annuity payments 

receivable on the date of the decedent’s death.” Although 

she acknowledges that these payments are receivable at the 
UNITED STATES V. PAULSON 25

decedent’s death and “may not actually be paid until some 

later point,” she maintains “[i]t is that receivable”—the 

receivable available at the decedent’s death—“that is 

brought within the gross estate by [§§] 2039 and 2042.” But 

the statute does not impose personal liability on those who 

“receive a receivable” on the date of the decedent’s death. 

See 26 U.S.C. § 6324(a)(2). Instead, the natural reading of 

the statute is that it defines the gross estate to include 

property that will be received after the date of the decedent’s 

death, regardless of whether it is receivable on that date.

Madeleine Pickens also argues that the statute’s 

incorporation of § 2041(a)(2), which brings within the gross 

estate property subject to a power of appointment that may 

not take effect until after the decedent’s death, does not mean 

that the statute imposes liability on those who receive such 

property after the date of the decedent’s death. This is so, 

she reasons, because § 2041(a)(2) states that such property 

shall be considered to exist on the date of the decedent’s 

death. But she does not explain why personal liability under 

§ 6324(a)(2) turns on whether property is deemed to exist on 

the date of the decedent’s death.15 The statute nowhere 

15 Section 2041(a)(2) provides that the gross estate shall include “any 

property with respect to which the decedent has at the time of his death 

a general power of appointment.” It further states that:

the power of appointment shall be considered to exist 

on the date of the decedent’s death even though the 

exercise of the power is subject to a precedent giving 

of notice or even though the exercise of the power 

takes effect only on the expiration of a stated period 

after its exercise, whether or not on or before the date 

of the decedent’s death notice has been given or the 

power has been exercised.
26 UNITED STATES V. PAULSON

includes this distinction. Instead, the statute explicitly

applies to property that trustees, transferees, beneficiaries,

and others listed in the statute have or receive. Property that 

exists on the date of the decedent’s death, including property 

within the scope of § 2041(a)(1), may be received after the 

date of the decedent’s death, and receiving such property 

subjects the recipient to personal liability for unpaid estate 

taxes.

Therefore, we conclude that the context and structure of 

§ 6324(a)(2) provide additional indicia of its meaning—

which supports the conclusion that the statute imposes 

personal liability for unpaid estate taxes on the categories of 

persons listed the statute who (1) receive estate property on 

or after the date of the decedent’s death, or (2) have estate 

property on the date of the decedents’ death—and 

defendants have not refuted these indicia of the statute’s 

meaning.

C

Vikki Paulson and Crystal Christensen also argue that 

applying the rule of the last antecedent to interpret the

statute, as in the government’s proposed “overly broad 

interpretation,” would result in “two absurd situations.”

First, they argue that if § 6324(a)(2) is construed to impose 

personal liability on those listed in the statute who receive 

property from the gross estate after the date of the decedent’s 

death, then the government could impose personal liability 

for unpaid estate taxes on purchasers of estate assets. They 

base this argument on the definition of a “transferee” as any 

26 U.S.C. § 2041(a)(2). Thus, by its plain terms, this provision clarifies 

that property subject to a power of appointment is included in the gross 

estate, even if the power of appointment is exercised after the decedent’s 

death.
UNITED STATES V. PAULSON 27

person to whom a property interest is conveyed, which, in 

their view, includes “purchasers.” Second, they argue that 

because the estate property is valued “at the time of the 

decedent’s death,” if the property later depreciates, those 

who receive estate property after the date of the decedent’s 

death could be personally liable for estate taxes that exceed 

the value of the property they received.

Although not expressly stated in their briefing, it appears 

these defendants are impliedly invoking the canon against 

absurdity. See United States v. Middleton, 231 F.3d 1207, 

1210 (9th Cir. 2000) (explaining that a court should avoid an 

interpretation of a statute that would produce “an absurd and 

unjust result which Congress could not have intended”) 

(quoting Clinton v. City of New York, 524 U.S. 417, 429 

(1998)). The defendants, however, fail to address longstanding Supreme Court and Ninth Circuit case law that 

strictly limitsthe circumstances in which the absurdity canon 

may apply. See, e.g., Crooks v. Harrelson, 282 U.S. 55, 60

(1930) (explaining that the absurdity doctrine is applied 

“only under rare and exceptional circumstances,” and that 

“the absurdity must be so gross as to shock the general moral 

or common sense”); see also id. (explaining that the 

application of the absurdity doctrine “so nearly approaches 

the boundary between the exercise of the judicial power and 

that of the legislative power as to call rather for great caution 

and circumspection in order to avoid usurpation of the 

latter.).16

16 See also Public Citizen v. U.S. Dep’t of Just., 491 U.S. 440, 470–71 

(1989) (Kennedy, J., concurring) (citing Church of the Holy Trinity v. 

United States, 143, U.S. 457, 459 (1892)) (explaining that courts may 

invoke the absurdity canon only when statutory language leads to 
28 UNITED STATES V. PAULSON

As the Court explained in Crooks, Congress may enact 

legislation that “turn[s] out to be mischievous, absurd, or 

otherwise objectionable. But in such case the remedy lies 

with the lawmaking authority, and not with the courts.” Id. 

(citations omitted); see also Griffin v. Oceanic Contractors, 

Inc., 458 U.S. 564, 571, 574–75 (1982) (concluding that an 

interpretation of federal maritime statute that resulted in 

$300,000 award to seaman for back wages penalty, when he 

had incurred only $412 in unpaid wages, did not present an 

“exceptional case” that allowed court to apply the absurdity 

doctrine); see also id. at 576 (“The remedy for any 

dissatisfaction with the results in particular cases lies with 

Congress and not with this Court. Congress may amend the 

statute; we may not.”).

As we explain next, without even reaching the absurdity

canon, the defendants’ first argument—suggesting tax 

liability could be applied to bona fide purchasers of estate

assets—fails based on the plain language of § 6324(a)(2) and 

other provisions of the tax code. The second argument fails 

because, even considering the absurdity canon, the result that 

defendants posit—that estate property could depreciate and 

result in tax liability that exceeds the property’s value—does 

not meet the high bar for showing absurdity. See United 

States v. Lopez, 998 F.3d 431, 438–39 (9th Cir. 2021)

(explaining that “the absurdity canon is ‘confined to 

situations where it is quite impossible that Congress could 

“patently absurd” results, such as shown by the “few examples of true 

absurdity . . . given in the Holy Trinity decision,” of prosecuting a sheriff 

for obstruction of the mail when he was executing a warrant to arrest a 

mail carrier for murder, or applying “a medieval law against drawing 

blood in the streets” to a physician treating “a man who had fallen down 

in a fit”).
UNITED STATES V. PAULSON 29

have intended the result’”) (quoting In re Hokulani Square, 

Inc., 776 F.3d 1083, 1088 (9th Cir. 2015)).

1

The defendants’ first argument fails because § 

6324(a)(2) does not impose liability on “purchasers.”

Instead, it imposes liability for the unpaid estate taxes on the 

following six categories of persons listed in the statute: a 

“spouse, transferee, trustee . . . , surviving tenant, person in 

possession of the property by reason of the exercise . . . of a 

power of appointment, or beneficiary.” 26 U.S.C. 

§ 6324(a)(2). The tax code, in § 6324(a)(2) and elsewhere, 

distinguishes purchasers from others who receive estate 

property. See id. §§ 2037(a), 2038(a), (b), 6323(a), and 

6324(a)(2), (3). Indeed, §§ 2037 and 2038 exempt from a 

decedent’s gross estate any property that was transferred to 

a bona fide purchaser for adequate and full consideration. Id. 

§§ 2037(a), 2038(a), (b). And § 6324(a)(2) provides that a 

transfer of estate property “to a purchaser or holder of a 

security interest” divests the transferred property of the 

special estate lien in § 6324(a)(1).17

17 We have previously explained, in the context of the special estate tax 

lien, that § 6324 “provides purchasers considerable, though not 

complete, protection.” Vohland, 675 F.2d at 1075 (footnote omitted). 

We further explained that:

Upon transfer of non-probate property to a purchaser, 

the property is divested of the lien, so that a purchaser

of such property is fully protected. [26 U.S.C.]

§ 6324(a)(2). Property that was part of the ‘probate’

estate, i.e., [§] 2033 property, is divested of the lien 

when it is transferred to a subsequent purchaser, but 
30 UNITED STATES V. PAULSON

Moreover, the tax code provides different definitions for 

“transferees” and “purchasers.” In § 6901, it defines a 

“transferee” as a “donee, heir, legatee, devisee, and 

distributee, and with respect to estate taxes, also includes any 

person who, under [§] 6324(a)(2), is personally liable for any 

part of such tax.” Id. § 6901(h). Notably, while this 

definition includes the categories of persons listed in 

§ 6324(a)(2), it does not include a “purchaser.”

In § 6323, the tax code defines a “purchaser” as “a 

person who, for adequate and full consideration in money or 

money’s worth, acquires an interest (other than a lien or 

security interest) in property which is valid under local law 

against subsequent purchasers without actual notice.” 26 

U.S.C. § 6323(h)(6). This definition requires more than the 

mere transfer or receipt of property; it requires adequate and 

full consideration to support the purchase. Therefore, for 

purposes of the tax code, the definition of transferee does not 

include a purchaser and the defendants’ argument fails.

18

only if the estate’s executor has been discharged from 

personal liability pursuant to [§] 2204.

Id. (footnote omitted) (citing 26 U.S.C. § 6324(a)(2), (3)). Moreover, 

there are means for a purchaser of probate property to avoid risks of loss 

“either by establishing that the executor or administrator has been 

released under [§] 2204 or by securing a certificate of discharge of the 

lien under [§] 6325(c).” Id. at 1076 (citation omitted).

18 Moreover, defendants’ interpretation of a “transferee” who receives 

estate property after the date of the decedent’s death as including a 

“purchaser” is not consistent with statute’s purpose of ensuring the 

collection of taxes, Vohland, 675 F.2d at 1076, because the transfer of 

property from the gross estate to a purchaser for “adequate and full 

consideration in money,” 26 U.S.C. § 6323, does not divest the estate “of 

the assets necessary to satisfy its tax obligations,” Geniviva, 16 F.3d at

524.
UNITED STATES V. PAULSON 31

2

a

The defendants’ second argument also fails. The 

defendants correctly state that the statutory language 

imposes estate tax liability “to the extent of the value, at the 

time of the decedent’s death, of such property.” Id. 

§ 6324(a)(2). The modifier “at the time of the decedent’s 

death” applies to “the extent of the value.” Id. This language 

plainly means that tax liability is calculated based on the 

value of the estate property at the time of decedent’s death. 

Id. As the government acknowledges, this provision favors 

the taxpayer by limiting liability for any unpaid estate taxes 

to the value of the property at the time of the decedent’s 

death, even if the property increases in value after the 

decedent’s death.19 See id. Thus, the statutory language 

anticipates, and allows, a potential windfall for a person who 

receives estate property that increases in value after the date 

of the decedent’s death.

The defendants, however, dispute that Congress could 

have also anticipated that estate property could depreciate

after the date of the decedent’s death and thus potentially 

result in tax liability for the recipient that exceeds the 

property’s value.20 The defendants argue that an 

19 In its briefing, the government stated that the “property is valued ‘at 

the time of the decedent’s death,’” and that “language simply caps

potential liability under § 6324(a)(2) by preventing liability from 

exceeding the value of the non-probate property at the time of the 

decedent’s death.”

20 If, as the defendants suggest, estate property continued to depreciate 

after the transferee or other beneficiary accepted it, such that the tax 

liability eventually exceeded the value of the property received, that risk 
32 UNITED STATES V. PAULSON

interpretation of § 6324(a)(2) that would allow the 

government to impose personal liability for the estate taxes 

“for a greater amount of money than they ever held,” would 

lead to “a nonsensical result.”21 But “[t]o avoid absurdity, 

the plain text of Congress’s statute need only produce 

‘rational’ results, not ‘wise’ results.” Lopez, 998 F.3d at 438 

(citing Hokulani Square, 776 F.3d at 1088). Thus, a statute’s 

text may lead to results that are “not wise,” and that we may 

even consider “harsh and misguided,” but a statute is not 

absurd if “it is at least rational.” Hokulani Square, 776 F.3d 

at 1088 (rejecting the argument that bankruptcy code 

provision was absurd because whether trustee received a fee 

for his services or worked for free turned on trivialities). 

And “the bar for ‘rational’ is quite low.” Lopez, 998 F.3d at 

438 (citing Griffin, 458 U.S. at 575–76).

This is not a situation where it is “quite impossible” that 

Congress could have intended the result. See Lopez, 998 

F.3d at 438 (citation omitted). Here, Congress clearly could 

have anticipated that the value of estate property could 

change after the date of the decedent’s death—either by 

increasing or decreasing in value—and thus could have 

of loss would apply equally to those who receive estate property on the 

date of the decedent’s death and to those who receive estate property 

after the date of the decedent’s death. There is nothing about the risk of 

accepting property that may decline in value that would apply unfairly 

to those who receive such property after the date of the decedent’s death.

21 The hypotheticals defendants assert to support their arguments are 

speculative and are not supported by the record. For example, they argue 

that the value of the estate assets here “almost certainly” declined 

because the estate included “uniquely depreciative horses in the Trust’s 

possession.” But this argument does not account for the living trust 

provisions mandating that “upon the [decedent’s] death” the trustee 

“shall sell promptly the entire interest of the trust” in certain assets, 

including “all horses.”
UNITED STATES V. PAULSON 33

anticipated that the value of some estate assets could 

depreciate below the amount of the estate tax liability. 

Indeed, as discussed more fully below, Congress included 

several provisions in the tax code that mitigate the risk that 

a transferee’s, beneficiary’s, or other person’s tax liability 

could exceed the value of the property they received, 

including: 26 U.S.C. § 2001 (tax rate based on a percentage 

of the taxable estate),

22 § 2002, 26 C.F.R. § 20.2002-1 

(executor’s duty to pay the estate tax before distributing 

estate property and liability for failing to do so), § 2518 

(disclaimer), and § 6502(a)(1) (statute of limitations).

And while it is “not our job to find reasons for what 

Congress has plainly done,” Lopez, 998 F.3d at 447 (M. 

Smith, J., concurring) (internal quotation marks and citation 

omitted), Congress rationally could have concluded that 

such risk is acceptable or is effectively mitigated by other 

provisions of the tax code, and thus is outweighed by the 

benefit of ensuring the collection of estate taxes. This is not 

an irrational tax policy. Indeed, we have previously 

recognized that “[§] 6324 is structured to assure collection 

of the estate tax.” Vohland, 675 F.2d at 1076. Moreover, 

even if it were to conclude that such a policy is “odd,” or 

“not wise,” Lopez, 998 F.3d at 447 (M. Smith, J., concurring)

(citation omitted), or simply unfair, we cannot rewrite the 

statute to advance a different policy, id. at 440 (majority 

opinion). See also Hokulani Square, 776 F.3d at 1088 (“The 

absurdity canon isn’t a license for us to disregard statutory 

text where it conflicts with our policy preferences . . . .”).

And if Congress determines that its tax policy leads to 

22 The taxable estate is determined by deducting from the value of the 

gross estate the deductions provided in Title 26, Part IV. 26 U.S.C. 

§ 2051.
34 UNITED STATES V. PAULSON

unintended or unfair results, it is for Congress, not the courts, 

to rewrite the tax code. See Crooks, 282 U.S. at 60; Griffin, 

458 U.S. at 576. Therefore, we conclude that applying the 

rule of the last antecedent to § 6324(a)(2) does not result in 

an absurd interpretation of the statute.

b

But our conclusion—that this is not the “exceptional”

case where we can invoke the absurdity canon to reject the 

interpretation of a statute that is most consistent with its text, 

structure, punctuation, and other indicia of meaning—does 

not mean that the defendants’ “the sky is falling”23

arguments are based on anything other than remote 

hypotheticals. And even if the defendants could demonstrate 

that applying § 6324(a)(2) to those who receive estate 

property after the date of the decedent’s death could result in 

what they characterize as an “absurd situation,” that situation 

will not arise here.

24

23 “Chicken Little,” Merriam-Webster.com Dictionary, 

https://www.merriam-webster.com/dictionary, last visited May 10, 

2023.

24 When Madeleine Pickens received assets from the estate, including 

two residences, personal property, and cash, the value of those assets 

exceeded the estate tax liability. Indeed, the government asserts that 

when Madeleine Pickens received this property it was worth $19 million, 

and Vikki Paulson and Crystal Christensen assert it was worth $42 

million. Madeleine Pickens does not dispute these valuations. Crystal 

Christensen received a non-depreciating bequest of cash, and the trustee 

distributed $990,125 to her. And even if Vikki Paulson and Crystal 

Christensen can establish that the estate’s tax liability exceeded the value 

of the estate assets when they became trustees, they cannot establish that 

it is absurd or unfair to impose tax liability on successor trustees because, 

as the terms of the living trust make clear, trustees serve only if they are 

“willing.”
UNITED STATES V. PAULSON 35

As an initial matter, before those who receive estate 

property could be subjected to tax liability that exceeds the 

value of the property they received, all the following events, 

some of which are remote and unlikely, must occur. 

First, the property must have depreciated after the date 

of the decedent’s death to the point that it is worth less than 

the tax liability, which is calculated as a percentage of the 

amount of the taxable estate.

25 See 26 U.S.C. § 2001 (setting 

rate schedule of 18% to 40%, depending on the amount of 

the taxable estate).

Second, the executor must have failed to pay the estate 

tax before distributing estate property. See 26 U.S.C. §§ 

2001(a), 2002; id. § 6324(a)(2) (imposing personal liability 

on transferee and others when “estate tax imposed by chapter 

11 is not paid when due”); 26 C.F.R. § 20.2002-1 (imposing 

personal liability on executor for distributing any portion of 

the estate before all estate tax is paid).

Third, the estate must have “divest[ed] itself of the assets 

necessary to satisfy its tax obligations,” Geniviva, 16 F.3d at 

524, thus defeating the lien for estate taxes under that would 

apply under § 6324(a)(1).

Fourth, the statute of limitations must not have expired 

by the time the property is distributed or the government 

attempts collection. See 26 U.S.C. § 6502(a)(1).

25 For example, in this case, at the time of Allen Paulson’s death, 

although his estate reported a gross taxable estate of $187,729,626, his 

net taxable estate was reported at a substantially lower amount, 

$9,234,172, and the tax liability was initially reported as $4,459,051. 

After the IRS successfully asserted a deficiency, the Tax Court 

determined that the estate owed an additional $6,669,477 in estate taxes. 

Thus, the tax liability was a fraction of the gross taxable estate.
36 UNITED STATES V. PAULSON

Fifth, a transferee, beneficiary, or other recipient of the 

estate property must not have disclaimed or refused the 

property. See 26 U.S.C. § 2518; 26 C.F.R. § 25.2518-2.26 

Sixth, the government must successfully seek to impose 

tax liability on a transferee, beneficiary, or other recipient of 

estate property in an amount that exceeds the value of the 

property they received.

Focusing on the final factor—whether the government 

would later seek to impose tax liability that exceeds the value 

of the property received and would be successful in 

advancing that argument—we rely on the government’s

avowals in its briefing and at oral argument that estate tax 

liability cannot exceed the value of the property received.

Specifically, the government asserted in its briefing that the 

language in § 6324(a)(2) that the estate property is valued at 

the time of the decedent’s death, “does not expose a person 

to liability that exceeds the value of the property that he or 

she personally had or received.” The government further 

emphasized this point, explaining that: “[i]nstead, a person 

will be liable under § 6324(a)(2) only to the extent that he or 

she actually ‘receives’ or ‘has’ non-probate property, viz., 

26 A disclaimer must be in writing, made within nine months of the 

transfer creating the interest or when the recipient reaches age 21, 

whichever is later, and before the transferee accepts any of the interest 

or its benefits. 26 U.S.C. § 2518(b). The regulations further explain that 

the nine-month period for making a disclaimer “generally is to be 

determined with reference to the transfer creating the interest in the 

disclaimant.” 26 C.F.R. § 25.2518-2(c)(3)(i). For transfers made by a 

decedent at death, the transfer creating the interest occurs on the date of 

the decedent’s death. Id.
UNITED STATES V. PAULSON 37

the person’s liability is capped at the value of the property 

had or received.”27

These representations, coupled with the doctrine of 

judicial estoppel, provide additional safeguards against the 

hypothetically unfair application of personal liability under 

§ 6324(a)(2), which the defendants posit. Although the 

application of judicial estoppel is discretionary, it could be 

applied to bar the government from later arguing, in this case 

or a future case, that it can recover more than the value of 

the property that the taxpayer received.

28 See New 

Hampshire v. Maine, 532 U.S. 742, 750 (2001) (explaining 

that judicial estoppel “is an equitable doctrine invoked by a 

court at its discretion” (internal quotation marks and citation 

omitted)). The doctrine exists to “to protect the integrity of 

the judicial process by prohibiting parties from deliberately 

changing positions according to the exigencies of the 

27 To support its position, the government cites United States v. Marshall, 

798 F.3d 296, 315 (5th Cir. 2015) (holding that a donee’s personal 

liability for gift tax under § 6324(b) “is capped by the amount of the 

gift”). Although the language of these subsections of § 6324 differ, with 

subsection (a)(2) limiting personal liability for estate taxes “to the extent 

of the value, at the time of the decedent’s death,” 26 U.S.C. § 6324(a)(2), 

and subsection (b) limiting gift tax liability “to the extent of the value of 

such gift,” id. § 6324(b), estate and gift taxes “are in pari materia and 

must be construed together.” Sanford v. Comm’r, 308 U.S. 39, 44 

(1939); see also Chambers v. Comm’r, 87 T.C. 225, 231 (1986) (same).

Thus, while the government’s citation to Marshall is not authoritative, it 

does provide persuasive support for the government’s position.

28 We have long recognized that “[t]he application of judicial estoppel is 

not limited to bar the assertion of inconsistent positions in the same 

litigation, but is also appropriate to bar litigants from making 

incompatible statements in two different cases.” Hamilton v. State Farm 

Fire & Cas. Co., 270 F.3d 778, 783 (9th Cir. 2001) (citations omitted). 
38 UNITED STATES V. PAULSON

moment.”29 Id. at 749–50 (internal quotation marks and 

citations omitted).

The Court has identified three non-exclusive factors that 

should “inform” a court’s decision whether to apply judicial 

estoppel: (1) “a party’s later position must be ‘clearly 

inconsistent’ with its earlier position”; (2) “the party has 

succeeded in persuading a court to accept that party’s earlier 

position, so that judicial acceptance of an inconsistent 

position in a later proceeding would create ‘the perception 

that either the first or the second court was misled’”; and (3) 

“the party seeking to assert an inconsistent position would 

derive an unfair advantage or impose an unfair detriment on 

29 Importantly, judicial estoppel differs significantly from other estoppel

doctrines, such as equitable estoppel. See Teledyne Indus., Inc. v. NLRB, 

911 F.2d 1214, 1219 (6th Cir. 1990) (“Although each of these doctrines 

deals with the preclusive effect of previous legal actions, the similarity 

ends there.”). “Judicial estoppel exists to protect the courts from the 

perversion of judicial machinery through a party’s attempt to take 

advantage of both sides of a factual issue at different stages of the 

proceedings.” Id. at 1220 (internal quotation marks and citation 

omitted). “In contrast, equitable estoppel serves to protect litigants from 

unscrupulous opponents who induce a litigant’s reliance on a position, 

then reverse themselves to argue that they win under the opposite 

scenario.” Id. (citation omitted). And while the Supreme Court has 

explained, in the context of equitable estoppel, that “it is well settled that 

the Government may not be estopped on the same terms as any other 

litigant,” Heckler v. Cmty. Health. Servs. of Crawford Cnty., Inc., 467 

U.S. 51, 60 (1984), judicial estoppel may be applied to prevent the 

government from asserting inconsistent legal arguments, United States 

v. Liquidators of Eur. Fed. Credit Bank, 630 F.3d 1139, 1147–49 (9th 

Cir. 2011) (holding that judicial estoppel barred the government from 

arguing that defendant could not raise legal claims challenging 

forfeitability in ancillary proceedings, after earlier arguing that defendant 

could raise their arguments during ancillary proceedings).
UNITED STATES V. PAULSON 39

the opposing party if not estopped.” Id. at 750–51 (internal 

quotation marks and citations omitted).

If these considerations were applied to the government’s

representations here—that § 6324(a)(2) does not allow the 

government to impose personal liability for unpaid estate 

taxes in an amount that exceeds the value of the property 

received—judicial estoppel could be applied to prevent the 

government from taking a contrary position in later 

litigation. First, such a position would be contrary to the 

government’s position in this case. Second, the government 

has succeeded in persuading us to accept its position, and 

judicial acceptance of an inconsistent position in a later 

proceeding would create the impression that either we, or the 

later court, were misled. Third, allowing the government to 

take a contrary position in later litigation would unfairly 

prejudice the taxpayers in the subsequent litigation, who 

may have relied on the government’s position, and would 

also prejudice the second court. See Rissetto v. Plumbers &

Steamfitters Local 343, 94 F.3d 597, 604 (9th Cir. 1996) 

(explaining that “the interests of the second court are 

uniquely implicated and threatened by the taking of an 

incompatible position”).

Moreover, there are cases that, while not directly 

addressing the issue before us now, include statements that 

lend support to the government’s argument that it does not 

seek to impose liability for estate taxes that exceed the value 

of the property received. See Geniviva, 16 F.3d at 523 

(construing § 6324(a)(2) and noting that “[t]his section 

provides that if estate taxes are not paid when due, the 

beneficiaries are liable up to the amount received from the 

estate”); Schuster v. Comm’r, 312 F.2d 311, 315 (9th Cir. 

1962) (considering § 827(b), a predecessor statute that 

included the same language as § 6324(a)(2), and explaining 
40 UNITED STATES V. PAULSON

that the statute imposed some limitations on a transferee’s

liability because “it requires that a deficiency be due from 

the estate, and that his [or her] liability therefor is limited to 

the value of the estate corpus which he [or she] received”).

Finally, defendants have not identified, and our research 

has not uncovered, any case in which the government has 

attempted to impose personal liability for estate taxes that 

exceeded the value of the property received. The absence of 

any case law on this point supports the conclusion that this 

situation has never been litigated because the government 

has never taken this position, which in turn, supports the 

conclusion that it is unlikely that the government will

attempt to assert this argument in future litigation.

Thus, we conclude that applying the rule of the last 

antecedent does not lead to absurd results, but instead results 

in the most natural reading of the statute, consistent with its 

structure and context.

D

The defendants also argue that to interpret the statute we 

must consider its purpose and intent. Madeleine Pickens 

argues that “the purpose of [§] 6324(a)(2) is to provide the 

Government with the same avenue to collect taxes from nonprobate property that it has with respect to probate property.” 

She reasons that just as probate property must “pass[] 

through the hands of the executor,” the “beneficiaries of a 

decedent’s trust can only take possession of trust property 

after it has passed through the hands of the trustee.” Thus, 

she concludes that the government’s interests “are fully 

protected when [§] 6324(a)(2) imposes personal liability on 

a trustee of the decedent’s trust who distributes property to a 

trust beneficiary without first paying the tax.”
UNITED STATES V. PAULSON 41

But nothing in the statutory text supports her argument 

that Congress’s purpose in enacting §6324(a)(2) was to 

impose personal liability for unpaid estate taxes on those

persons, “including trustees,” who “stand in the same 

position as the executor.” The statute does not impose 

personal liability for unpaid estate taxes based on the 

existence or exercise of a fiduciary duty to the estate.30 

Instead, § 6324(a)(b) imposes personal liability, based on 

receipt or possession of property from the gross estate, on 

the categories of persons listed in the statute, and that list 

does not include executors or administrators. And while the 

list includes trustees, it also includes transferees, spouses, 

beneficiaries, and others who do not act as fiduciaries or 

administrators of the estate. 26 U.S.C. § 6324(a)(2). We 

therefore find no basis to conclude that personal liability for 

unpaid estate taxes on non-probate property under 

§ 6324(a)(2) is intended to mirror an executor’s liability for 

distributions of probate property.

Vikki Paulson and Crystal Christensen also argue that we 

should interpret the statute based on Congress’s intent. They 

baldly assert that “Congress did not intend that individuals 

who had no control over estate property at the date of the 

decedent’s death be held liable for unpaid estate taxes.” This 

argument, like Madeleine Pickens’ “purpose of the statute” 

argument, fails because it has no support in the statutory text. 

There is nothing in the statute that suggests that liability for 

unpaid estate taxes is based on the opportunity to ensure that 

taxes are paid at a particular time; instead, the statute 

30 Indeed, other sections of the tax code and regulations address the 

collection of taxes from fiduciaries. See 26 U.S.C. § 6901 (providing 

methods of collection of taxes from transferees and fiduciaries); 26 

C.F.R. § 20.2002-1 (explaining the liability of executors, administrators, 

and others).
42 UNITED STATES V. PAULSON

imposes personal liability on those who receive or have 

estate property. § 6324(a)(2).

E

The defendants also argue that ambiguities in tax statutes 

must be resolved in favor of the taxpayer and against the 

government. However, as the United States argues, the 

“modern validity” of the “taxpayer rule of lenity” is 

“questionable.” See Colgate-Palmolive-Peet Co. v. United 

States, 320 U.S. 422, 429–30 (1943) (resolving ambiguity in 

taxing statute in favor of the government); Maloney v. 

Portland Assocs., 109 F.2d 124, 126 (9th Cir. 1940)

(“[T]here is considerable doubt as to the present existence of 

the old rule to the effect that ambiguities in a taxing act are 

to be resolved in favor of the taxpayer.”); SCALIA &

GARNER, supra, at 299–300, & nn.17–19 (explaining that the 

Court previously construed tax laws “strict[ly]” and in 

“case[s] of doubt . . . against the government,” but the rule 

“can no longer be said to enjoy universal approval.” 

(footnotes omitted)); see also Fang Lin Ai v. United States, 

809 F.3d 503, 507 (9th Cir. 2015) (“[W]e do not 

mechanically resolve doubts in favor of the taxpayer but 

instead resort to the ordinary tools of statutory 

interpretation.”).

Vikki Paulson and Crystal Christensen acknowledge that 

“the rule of lenity is sometimes called into question,” but 

they argue that the Ninth Circuit “still strictly construes tax 

provisions to resolve ambiguity in the taxpayer’s favor.” To 

support this broad assertion they cite our decision in United 

States v. Boyd, 991 F.3d 1077, 1085 (9th Cir. 2021). But 

defendants’ arguments, if accepted, would require us to 

stretch Boyd beyond its language and reasoning—in Boyd, 

we did not state that the rule of lenity applies to all 
UNITED STATES V. PAULSON 43

ambiguous “tax provisions” or that all such provisions must 

be strictly construed. See id. at 1085–86. Instead, our 

discussion was limited to “tax provision[s] which impose[]

a penalty.” Id. at 1085 (emphasis added).

To be sure, we explained that “our circuit strictly 

construes tax penalty provisions independent of the rule of 

lenity.” Id. at 1085–86 (emphasis added). Thus, we treated 

tax provisions that apply penalties, but not all other tax 

provisions, as akin to criminal statutes to which “the rule of 

lenity ordinarily applies.” Id.; see also SCALIA & GARNER,

supra, at 296 (explaining that the rule of lenity reflects the 

idea that penal statutes must “mak[e] clear what conduct 

incurs the punishment” (citations omitted)). Indeed, in Fang 

Lin Ai, we considered provisions imposing taxes and 

rejected the argument that doubts about such statutes should 

be resolved in favor of the taxpayer; instead we explained 

that we construe taxing statutes by applying the ordinary 

rules of statutory construction. 809 F.3d at 506–07 (citations 

omitted).

But we need not decide the modern validity of the rule 

of lenity as applied to all tax provisions because that rule

does not apply to the statute at issue here. That is because 

“[t]he rule ‘applies only when, after consulting traditional 

canons of statutory construction, we are left with an 

ambiguous statute.’” Shular v. United States, 140 S. Ct. 779, 

787 (2020) (quoting United States v. Shabani, 513 U.S. 10, 

17 (1991)); see id. at 788 (Kavanaugh, J., concurring) (“Of 

course, when a reviewing court employs all of the traditional 

tools of construction, the court will almost always reach a 

conclusion about the best interpretation, thereby resolving 

any perceived ambiguity. That explains why the rule of 

lenity rarely comes into play.” (internal quotation marks and 

citation omitted)). As previously explained, after reviewing 
44 UNITED STATES V. PAULSON

the text of § 6324(a)(2), applying the canons of 

interpretation, and considering other indicia of its meaning, 

we are not “left with an ambiguous statute,” see Shular, 140 

S. Ct. at 787. Therefore, even if were to conclude that the 

rule of lenity remains a valid tool to construe statutes 

imposing taxes, it would not apply here. 

F

Finally, the defendants argue that we must accept their 

interpretation of § 6324(a)(2) because the government’s 

interpretation “has been rejected by every court that has ever 

considered it,” and that “every court addressing 

[§] 6324(a)(2)” agrees with them. But the defendants

grossly overstate the weight of the authority that supposedly 

supports their sweeping statements. Indeed, the scant 

authority upon which the defendants rely consists of one 

decades-old tax court case interpreting a predecessor statute

to § 6324(a)(2), Englert v. Commissioner, 32 T.C. 1008 

(1959),31 and one unpublished district court decision relying 

on Englert to interpret § 6324(a)(2), United States v. 

Johnson, No. CV 11-00087, 2013 WL 3924087 (D. Utah 

July 29, 2013). We are not persuaded by the reasoning of 

these cases.

In both cases, without any attempt to construe the 

statutes by applying the traditional tools—namely the 

canons of statutory interpretation—the courts concluded that 

because the statutory language could support different 

interpretations, the statutes must be deemed ambiguous, and 

thus “any doubt as to the meaning of the statutes” must be 

31 In Englert, the tax court considered § 827(b) of the Internal Revenue 

Code of 1939, as amended by the Revenue Act of 1942. 32 T.C. at 1012, 

1017 n.1 & n.4.
UNITED STATES V. PAULSON 45

resolved in the taxpayer’s favor.32 Englert, 32 T.C. at 1016; 

see also Johnson, 2013 WL 3924087, at *5 (“Where there is 

ambiguity as to the meaning of a tax statute, the court must 

resolve the issue in favor of the taxpayer.”). But, as 

discussed above, even if the rule of lenity validly applies to 

taxing statutes, it does so “only when, after consulting 

traditional canons of statutory construction, we are left with 

an ambiguous statute.’” Shular, 140 S. Ct. at 787 (internal 

quotation marks and citation omitted). Because the courts in 

Englert and Johnson made no attempt to “resolv[e] any 

perceived ambiguity,” see id. at 788 (Kavanaugh, J., 

concurring), they erroneously concluded that they were 

required to construe the statutes at issue in the taxpayer’s 

favor. Therefore, we decline the defendants’ suggestion that 

we adopt the reasoning of these cases. 

* * * *

After starting our analysis with the text of § 6324(a)(2), 

considering other indicia of its meaning including its 

structure and context, and applying the canons of statutory 

interpretation, we conclude that the statute imposes personal 

liability for unpaid estate taxes on the categories of persons 

listed in the statute who (1) receive estate property on or 

after the date of the decedent’s death, or (2) have estate 

property on the date of the decedent’s death. Therefore, 

32 Significantly, in the section of Englert finding § 827(b) ambiguous, 

the tax court misquoted the provision’s punctuation by omitting a 

comma. See 32 T.C. at 1015–16. The court quoted the statute as stating 

that liability applies to a person “‘who receives, or has on the date of the 

decedent’s death the property included in the gross estate . . .’”, but the 

text actually states that liability applies to a person “who receives, or has 

on the date of the decedent’s death, property included in the gross estate 

. . . .” As discussed in Section III.A, changes in punctuation can change 

the meaning of the text. 
46 UNITED STATES V. PAULSON

§ 6324(a)(2) imposes personal liability for unpaid estate 

taxes on trustees, transferees, beneficiaries, and others listed 

in the statute, who receive or have estate property on or after 

the date of the decedent’s death.

IV

Our holding that § 6324(a)(2) imposes personal liability 

on those listed in the statute, who have or receive estate

property on or after the date of the decedent’s death, does 

not completely resolve this matter. We must determine 

whether the defendants fall within the categories of persons 

listed in the statute and are thus liable for the unpaid estate 

taxes.

A

The government argues that the defendants are liable 

under the statute as trustees, transferees, and beneficiaries. 

Vikki Paulson and Crystal Christensen acknowledge that 

they are successor trustees, and James Paulson has not 

submitted a brief contesting the district court’s finding that 

he was a successor trustee. Thus, these defendants do not 

dispute that, if § 6324(a)(2) applies to those who receive or 

have estate property after the date of the decedent’s death, 

they are liable as “trustees” under § 6324(a)(2).

We therefore conclude that James Paulson, Vikki 

Paulson, and Crystal Christensen are liable, as trustees, for 

the unpaid estate taxes on property from the gross estate, 

held in the living trust, “to the extent of the value, at the time 

of the decedent’s death, of such property.” 26 U.S.C. 

§ 6324(a)(2). But, as previously discussed and as conceded 

by the government, see supra Section III.C.2.b, that liability 

is capped at the value of estate property in the living trust at 

the time of Allen Paulson’s death, and each defendants’ 
UNITED STATES V. PAULSON 47

liability cannot exceed the value of the property at the time 

that they received or had it as trustees.

B

The government also argues that the ordinary meaning 

of “beneficiary” includes “trust beneficiaries” and therefore

Crystal Christensen and Madeleine Pickens are liable as 

beneficiaries under § 6324(a)(2) for the unpaid estate 

taxes.

33 These defendants acknowledge that they are “trust 

beneficiaries,” but they argue that they are not 

“beneficiar[ies],” as that term is used in § 6324(a)(2). 

Instead, they argue that “beneficiary” in § 6324(a)(2) has a 

narrow meaning and applies only to life insurance 

beneficiaries.

34

Because the statute does not define “beneficiary,” “we 

look first to the word’s ordinary meaning.” See Schindler 

Elevator Crop. v. United States, 563 U.S. 401, 407 (2011) 

(citing Gross v. FBL Fin. Servs., 557 U.S. 167, 175 (2009) 

(“Statutory construction must begin with the language 

employed by Congress and the assumption that the ordinary 

meaning of that language accurately expresses the legislative 

purpose” (internal quotation marks omitted)); Asgrow Seed 

Co. v. Winterboer, 513 U.S. 179, 187 (1995) (“When terms 

used in a statute are undefined, we give them their ordinary 

meaning”). At this first step, we conclude that dictionary 

definitions support the government’s broad interpretation, 

33 Because we conclude that Crystal Christensen and Madeleine Pickens 

are liable for the unpaid estate taxes as beneficiaries under § 6324(a)(2), 

we need not address whether they are also liable as “transferees,” as that 

term is used in the statute.

34 As we discuss later, infra, at n.36, Madeleine Pickens acknowledges 

that beneficiaries may also include beneficiaries of annuity payments.
48 UNITED STATES V. PAULSON

rather than the defendants’ narrow interpretation limiting 

liability to insurance beneficiaries. See Beneficiary, 

BLACK’S LAW DICTIONARY (11th ed. 2019) (defining 

“beneficiary” as “[s]omeone who is designated to receive the 

advantages from an action or change; esp., one designated to 

benefit from an appointment, disposition, or assignment (as 

in a will, insurance policy, etc.), or to receive something as 

a result of a legal arrangement or instrument,” and 

“[s]omeone designated to receive money or property from a 

person who has died”); see also Beneficiary, AMERICAN 

HERITAGE DICTIONARY (5th ed. 2018) (“One that receives a 

benefit” or “the recipient of funds, property, or other 

benefits, as from an insurance policy or trust”); Beneficiary, 

WEBSTER’S NEW WORLD COLLEGE DICTIONARY (5th ed 

2014) (“[A]nyone receiving benefit” or “a person named to 

receive the income or inheritance from a will, insurance 

policy, trust, etc. . . . ”); Beneficiary, WEBSTER’S NEW 

WORLD DICTIONARY (4th ed. 2003) (“[A]nyone receiving or 

to receive benefits, as funds from a will or insurance policy

. . . .”); Beneficiary, 2 OXFORD ENGLISH DICTIONARY (2d ed. 

1989) (“[O]ne who receives benefits or favours; a debtor to 

another’s bounty . . . .”). Therefore, we conclude that the 

ordinary meaning of “beneficiary” includes a “trust 

beneficiary.”

C

But we must also consider whether “there is any textual 

basis for adopting a narrower definition” of “beneficiary.” 

See Schindler, 63 U.S. at 409; see also SCALIA & GARNER, 

supra, at 70 (“One should assume the contextually 

appropriate ordinary meaning unless there is reason to think 

otherwise. Sometimes there is reason to think otherwise, 

which ordinarily comes from context.” (emphasis in 

original)). The government argues that the text of 
UNITED STATES V. PAULSON 49

§ 6324(a)(2) does not indicate that “beneficiary” has a 

narrower meaning than its ordinary meaning. The 

defendants, however, argue that the context and structure of 

the statute support a narrower interpretation.

The defendants rely on two cases interpreting 

predecessor versions of the statute, Higley v. Commissioner, 

69 F.2d 160 (8th Cir. 1934), and Englert, 32 T.C. 1008 

(1959), and two cases applying the reasoning of these earlier 

cases to interpret § 6324(a)(2), Garrett v. Commissioner,

T.C. Memo. 1994-70 (1994), and Johnson, 2013 WL 

3924087 (D. Utah 2013). As we explain next, we are not 

persuaded by these cases, or the defendants’ arguments, that 

the structure or context of the statute support a narrow 

interpretation that overcomes the ordinary meaning of 

beneficiary.

We start with Higley v. Commissioner, in which the 

Eighth Circuit interpreted the word “beneficiary” in § 315(b) 

of the Revenue Act of 1926. 69 F.2d at 162. The text of this 

predecessor statute, however, differs significantly from the 

text of § 6324(a)(2), and so § 315(b)’s relevance to our 

analysis is limited. Section 315(b) provided:

If (1) the decedent makes a transfer, by trust 

or otherwise, of any property in 

contemplation of or intended to take effect in 

possession or enjoyment at or after his death 

. . . or (2) if insurance passes under a contract 

executed by the decedent in favor of a specific 

beneficiary, and if in either case the tax in 

respect thereto is not paid when due, then the 
50 UNITED STATES V. PAULSON

transferee, trustee, or beneficiary shall be 

personally liable for such tax[.]

Id. (quoting 26 U.S.C. § 1115(b) (emphasis added)). As the 

court recognized in its analysis of the statute, § 315(b)

expressly addressed two types of property dispositions: (1) 

“transfers,” including “trusts,” and (2) “insurance,” and 

imposed liability on the “transferee, trustee, or beneficiary.” 

Id. Indeed, the statute specifically referred to “insurance . . 

. in favor of a specific beneficiary.” Id. The court concluded 

that this structure meant that the word “trustee” was 

“employed in connection with trust only,” and the word 

“beneficiary” “applies only to insurance policy 

beneficiaries.” Id.

But this direct textual and structural correlation between 

(1) dispositions by “transfers” and” trusts” to the liability of 

a “transferee” or “trustee,” and (2) dispositions of “insurance 

. . . in favor of a specific beneficiary” to the liability of a 

“beneficiary,” is not present in § 6324(a)(2). We therefore 

conclude that the court’s analysis in Higley, based on the text 

and structure of § 315(b), does not support the defendants’ 

narrow interpretation of “beneficiary” in § 6324(a)(2).

We next consider Englert v. Commissioner, in which the 

Tax Court interpreted another predecessor statute, § 827(b) 

of the Internal Revenue Code of 1939, as amended by the 

Revenue Act of 1942. 32 T.C. at 1012-13, 1015. The 

structure of this predecessor statute also differs from 

§ 6324(a)(2). Section 879(b), in relevant part, provided:

If the tax herein imposed is not paid when 

due, then the spouse, transferee, trustee, 

surviving tenant, person in possession of the 

property by reason of the exercise, 
UNITED STATES V. PAULSON 51

nonexercise, or release of a power of 

appointment, or beneficiary, who receives, or 

has on the date of the decedent’s death, 

property included in the gross estate under 

section 811(b), (c), (d), (e), (f), or (g), to the 

extent of the value, at the time of the 

decedent’s death, of such property, shall be 

personally liable for such tax.

Id. at 1017, n.4 (quoting 26 U.S.C. § 827(b)). 

As the Tax Court noted, § 827(b) “names six classes of 

persons who, . . . may be personally liable for the unpaid 

tax.” Id. at 1012. These six classes—(1) spouse, (2) 

transferee, (3) trustee, (4) surviving tenant, (5) person in 

possession, and (6) beneficiary—correspond directly to, and 

in the same order as, the property included in the gross estate 

in §§ 811 (b), (c), (d), (e), (f), or (g). Id. at 1012, 1016 (“In 

a single sentence of section 827(b) it is provided that there 

may be liable six classifications of persons who hold 

property includible in the estate under six specific 

subsections of section 811 of the Code.”).

The court stated its belief that Congress “studiously 

chose a classification applicable to each of such subsections 

and included them in section 827(b) in the same order as the 

related property interests appeal in subsections (b) through 

(g), inclusive, of section 811.” Id. at 1016. Applying this 

reasoning, and as petitioner argued, the court concluded that

a person liable under the statute as a beneficiary would be 

limited to the beneficiary of a life insurance policy under 

§ 811(g). See id. at 1013, 1016.

But § 6324(a)(2) does not include § 827(b)’s precise 

correspondence between categories of liable persons and 
52 UNITED STATES V. PAULSON

types of property. As the defendants acknowledge, the 

statute now lists six categories of liable persons, but then 

incorporates nine categories of properties included in the 

gross estate. The defendants argue that these changes to the 

text and structure of the statute do not change the analysis, 

the differing statutory provisions are “substantially the 

same,” and the differences in the text should be considered 

“minor adjustments.” We are not persuaded by these 

arguments. 

As an initial matter, in Englert, the tax court found 

compelling the direct correlation of the six categories of 

persons liable to the six categories of property included in 

the gross estate, and concluded it was the result of 

Congress’s “studious[] cho[ice.]” Id. at 1016. That direct 

correlation is not present in § 6324(a)(2) and we cannot 

simply brush aside the differences in the statute’s structure 

and text.35 But even more importantly, § 6324(a)(2) differs 

substantively from its predecessor statutes by incorporating 

§ 2039, which includes in the gross estate “an annuity of 

other payment receivable by any beneficiary,” thus explicitly 

applying the word “beneficiary” beyond life insurance 

beneficiaries. 36 Therefore, the court’s reasoning in Englert

35 Madeleine Pickens suggests that Congress was aware of Englert when 

it enacted § 6324(a)(2) and if it had intended to change the meaning of 

the text “it would have stated as much explicitly.” But Englert was 

decided in 1959, five years after Congress enacted § 6324(a)(2). See

Internal Revenue Code of 1954, § 6324, 68A stat. i, 780 (1954).

36 Madeleine Pickens acknowledges that although “prior cases have held 

that the term ‘beneficiary’ in section 6324(a)(2) means only the 

beneficiary of life insurance proceeds, the addition of section 2039 and 

its incorporation into section 6324(a)(2) likely means that a beneficiary 

of annuity payments would also be considered a ‘beneficiary’ under 
UNITED STATES V. PAULSON 53

does not provide a textual or structural basis for us to 

conclude that the word “beneficiary” in § 6324(a)(2) should 

be limited to beneficiaries of life insurance.

Despite the textual and structural differences between 

§ 6324(a)(2) and its predecessor statutes, the defendants rely 

on two more recent cases, Garrett and Johnson, to argue that 

the reasoning of Higley and Englert “apply with equal force” 

to § 6324(a)(2). In Garrett, the court applied the reasoning 

of Higley and Englert to conclude that the word 

“beneficiary” in § 6324(a)(2) refers only to life insurance 

beneficiaries.37 Garrett, T.C. Memo. 1994-70 at *12-*14. 

But the court did not provide any analysis of the text or 

structure of § 6324(a)(2), and instead concluded that it found 

“nothing in the current statutory language that would warrant 

a more expansive definition of ‘beneficiary’ or [a] departure 

from earlier precedent under section 827(b).” Id. at *14. 

This conclusion is refuted by the substantive differences 

between the predecessor statutes, § 315(b) and § 827(b), and 

the current statute, § 6324(a)(2), including the current 

statute’s explicit expansion of the meaning of the word 

beneficiary through the incorporation of § 2039.

section 6324(a)(2).” She recognizes this is a “substantive” difference. 

But she suggests this is not important to our interpretation of the statute 

because “that question was not before the District Court, is not before 

this Court, and need not be decided in order to dispose of the appeal.” 

We disagree. This substantive difference between the statutes is highly 

relevant and important to their interpretation.

37 In Johnson, the court simply adopted the reasoning of Garrett, without 

any additional analysis, 2013 WL 3924087, at *8; we therefore reject its 

conclusions for the same reasons we reject the reasoning of Garrett.
54 UNITED STATES V. PAULSON

D

We must also apply the presumption of consistent usage 

that “a word or phrase is presumed to bear the same meaning 

throughout a text.” SCALIA & GARNER, supra, at 170; see 

also id. at 172 (“The presumption of consistent usage applies 

also when different sections of an act or code are at issue.”). 

In this case, we note that the use of the term “beneficiary,” 

in different sections of the tax code and in the regulations, 

supports the broader, ordinary meaning of the word.

First, the defendants argue that § 6324(a)(2), by 

incorporating § 2042, limits the word “beneficiary” to the 

beneficiaries of life insurance policies. However, as 

previously noted, § 6324(a)(2) also incorporates § 2039, 

which defines a “beneficiary” as one who receives “an 

annuity or other payment receivable . . . by reason of 

surviving the decedent under any form of contract or 

agreement,” but explicitly excludes life insurance 

beneficiaries from that definition. 26 U.S.C. § 2039(a). 

Thus, by incorporating § 2039, the statute applies the term 

“beneficiary” beyond life insurance beneficiaries and thus its 

context and structure do not support the defendants’ limited 

interpretation.

Second, the same is true for § 679, which is titled 

“Foreign trust having one of more United States 

beneficiaries.” 26 U.S.C. § 679. This section explains, 

outside the context of estate taxes, when a “United States 

person” will be liable for taxes on property transferred to a 

foreign trust. Throughout this section, the statute refers to 

trusts with a “United States beneficiary,” a “beneficiary of 

the trust,” a “United States beneficiary for any portion of the 

trust,” and when “making a distribution from the trust to, or 

for the benefit of, any person, such trust shall be treated as 
UNITED STATES V. PAULSON 55

having a beneficiary who is a United States person.” Id. 

§§ 679(a)(1); (a)(3)(C), (b)(2), & (c). In this section, 

although the context differs from personal liability for estate 

taxes, the tax code does not limit a “beneficiary” to an 

insurance beneficiary.

Finally, the regulations addressing liability for estate 

taxes use the term “beneficiary” broadly to indicate those 

who receive distributions from the estate, or in other words, 

trust beneficiaries. See 26 C.F.R. § 20.2002-1. This section 

of the regulations imposes personal liability for unpaid estate 

taxes on the executor (or administrator, or any person in 

actual or constructive possession of the decedent’s property), 

who pays a “debt” of the estate to any person before paying 

the debts due the United States. Id. The regulation explains 

that “the word debt includes a beneficiary’s distributive 

share of an estate.” Id. Thus, the regulation’s references to 

a “beneficiary’s distributive share of an estate,” supports the 

conclusion that the term beneficiary in the tax code, 

including § 6324(a)(2), applies to trust beneficiaries. We 

conclude therefore that the presumption of consistent usage 

supports applying the ordinary meaning of the word 

“beneficiary” in § 6324(a)(2).

E

Finally, the defendants offer policy arguments to support 

their interpretation of the statute. Crystal Christensen argues 

that because trust beneficiaries have “no power to take estate 

property,” or “to distribute it,” they should not be liable for 

the estate taxes if a trustee mismanages the estate and 

distributes property before “ensuring the estate’s taxes [are]

paid in full.” But the statute does not condition personal 

liability for the unpaid estate taxes on the power to take or 

distribute estate property. Instead, it imposes personal 
56 UNITED STATES V. PAULSON

liability on categories of persons who receive or have estate 

property, and those categories include persons who do not 

have the power to take or distribute estate property.

Indeed, the defendants recognize that life insurance 

beneficiaries are “beneficiaries” under § 6324(a)(2), and life 

insurance beneficiaries, like trust beneficiaries, lack to the

power to take or distribute estate property. The same can be 

said for transferees, joint tenants, and spouses (who are not 

also the trustee or executor), yet the defendants do not 

suggest that these categories of persons listed in the statute 

are not liable for unpaid estate taxes. Thus, the plain text of 

the statute imposes personal liability for unpaid estate taxes 

on those who receive or have estate property, without regard 

to their ability to take or distribute such property.

The defendants also argue that we should reject the 

government’s argument that § 6324(a)(2) employs the 

ordinary meaning of the word “beneficiary” because that 

interpretation would “render[] the term unlimited to the point 

of absurdity.” They suggest that adopting the government’s 

interpretation of beneficiary would leave no limits on 

liability. But the statute limits a beneficiary’s liability (1) to 

the types of property included in the decedent’s gross estate 

through §§ 2034–2042, see § 6324(a)(2), and (2) to the value 

of the property the beneficiary receives or has, see supra 

Section III.C.2.b.

* * * *

We conclude that the ordinary meaning of beneficiary, 

which includes trust beneficiaries, applies to § 6324(a)(2), 

and we are not persuaded that the structure or context of the 

statute, or policy considerations, require a narrower 

interpretation as the defendants argue. Moreover, applying 

the presumption of consistent usage further supports our 
UNITED STATES V. PAULSON 57

conclusion that the term beneficiary in the tax code includes 

trust beneficiaries. Therefore, we conclude that Crystal 

Christensen and Madeleine Pickens are liable for the unpaid 

estate taxes under § 6324(a)(2) as beneficiaries. However, 

the liability of each of these defendants cannot exceed the 

value of the estate property at the time of decedent’s death, 

or the value of that property at the time they received it.

V

Because § 6324(a)(2) imposes personal liability for 

unpaid estate taxes on the categories of persons listed in the 

statute who receive or have estate property, either on the date 

of the decedent’s death or at any time thereafter, subject to 

the applicable statute of limitations, and the defendants were 

within the categories of persons listed in the statute when 

they received or had estate property, we conclude that they 

are liable for the unpaid estate taxes as trustees and 

beneficiaries. We therefore reverse the district court’s 

judgment in favor of the defendants on the United States’ 

claims under § 6324(a)(2), and remand to the district court 

with instructions to enter judgment in favor of the 

government on these claims with any further proceedings 

necessary to determine the amount of each defendant’s 

liability for the unpaid taxes.

REVERSED and REMANDED.
58 UNITED STATES V. PAULSON

IKUTA, Circuit Judge, dissenting: 

Our only task in interpreting 26 U.S.C. § 6324(a)(2) is to 

determine congressional intent. Because the language of the 

statute is ambiguous, we must consider the “most logical 

meaning” of the statute. United States v. One Sentinel Arms 

Striker-12 Shotgun Serial No. 001725, 416 F.3d 977, 979 

(9th Cir. 2005) (One Sentinel) (citation and quotation marks 

omitted). The majority and the government effectively 

concede that their interpretation of § 6324(a)(2) is not 

logical because it would allow a person who receives estate 

property years after the estate is settled to be held personally 

liable for estate taxes that potentially exceed the current 

value of the property received. The taxpayers’s reading of 

the statute, which also accords with the plain language of the 

text, is more logical: it would allow the government to 

impose personal liability for estate taxes only on a person 

who receives (or holds) estate property on the date of the 

decedent’s death. 

Rather than adopt a reasonable interpretation of the 

statute that is more likely to reflect congressional intent, the 

majority adopts a “hypertechnical reading” of statutory 

language that loses sight of the “fundamental canon of 

statutory construction that the words of a statute must be read 

in their context and with a view to their place in the overall 

statutory scheme.” Davis v. Mich. Dep’t of Treasury, 489 

U.S. 803, 809 (1989) (citation omitted). In order to justify 

this approach, the majority and the government proffer a 

number of unpersuasive rationales. First, the government 

provides a non-responsive description of its litigating 

position: it states it “has consistently argued” that it would 

not impose liability greater than the value of the property 

received. The majority, in turn, suggests that the result of its 
UNITED STATES V. PAULSON 59

interpretation is not likely to occur. But neither the 

government’s nor the majority’s assurances about the future 

(that individuals are unlikely to be held personally liable for 

estate taxes that potentially exceed the current value of the 

property received from a decedent’s estate) impacts the 

interpretation of the statute. 

Because the taxpayers’s reading is more plausible and 

avoids the majority’s illogical result, it is a better indication 

of Congress’s intent. The inquiry should end there. 

Therefore, I respectfully dissent. 

I 

A 

When an individual dies, an estate tax lien automatically 

arises and attaches to the decedent’s gross estate. 26 U.S.C. 

§ 6324(a)(1). Such a lien attaches for a period of ten years 

from the date of the decedent’s death, and then automatically 

expires. Id. Although the estate tax lien expires after ten 

years, the executors of qualifying estates can elect to pay 

estate tax payments in installments over a period of fourteen 

years. 26 U.S.C. §6166. As a result, the government’s 

interest in the last installments is not fully secured by the tenyear tax lien under § 6324(a)(1). Addressing this issue, the 

tax code provides the government with various options to 

protect its interests beyond the ten-year § 6324(a)(1) period, 

including the option to require a surety bond pursuant to 26 

U.S.C. § 6165, see 26 U.S.C. § 6166(k)(1), and the option to 

require a special lien pursuant to 26 U.S.C. § 6324A. See 

United States v. Spoor, 838 F.3d 1197, 1205 (11th Cir. 2016) 

(noting that a § 6324A lien is a means of requiring “full 

collateral” for a § 6166 deferral); see also 26 U.S.C. 

§ 6166(k)(2). 
60 UNITED STATES V. PAULSON

In addition to a lien, § 6324(a)(2) imposes personal 

liability for estate taxes on individuals listed in the statute. 

A listed individual “who receives, or has on the date of the 

decedent’s death, property included in the [decedent’s] gross 

estate . . . shall be personally liable” for the unpaid estate tax 

up to “the extent of the value” of such property “at the time 

of the decedent’s death.” 26 U.S.C. § 6324(a)(2). Like the 

substantially similar language in the predecessor statute, 

§ 827(b) of the 1939 Internal Revenue Code,1 this language 

imposes personal liability only on “the person who ‘on the 

date of the decedent's death’ receives or holds the property 

of a transfer made in contemplation of, or taking effect at, 

death.” Englert v. Comm’r, 32 T.C. 1008, 1016 (1959); see 

also Garrett v. Comm’r, 67 T.C.M. (CCH) 2214, at *14 

(1994); United States v. Johnson, 2013 WL 3924087, at *5 

(D. Utah July 29, 2013). In this context, the words 

“receives” and “has” at the date of death refer to two 

different situations. The phrase “has on the date of 

decedent’s death” refers to a person who holds property 

transferred within three years before the decedent’s death, 

which is considered part of the decedent’s gross estate for 

1 Section 827(b) provided:

If the tax herein imposed is not paid when due, then 

the spouse, transferee, trustee, surviving tenant, person 

in possession of the property by reason of the exercise, 

nonexercise, or release of a power of appointment, or 

beneficiary, who receives, or has on the date of the 

decedent's death, property included in the gross estate 

under section 811(b), (c), (d), (e), (f), or (g), to the 

extent of the value, at the time of the decedent's death, 

of such property, shall be personally liable for such 

tax.

26 U.S.C. § 827(b) (1939) (emphasis added). 
UNITED STATES V. PAULSON 61

tax purposes. See 26 U.S.C. § 2035(c)(1). The phrase 

“receives . . . on the date of decedent’s death,” refers to 

“property received by persons solely because of decedent’s 

death,” and “which was not in the possession of one of the 

persons . . . at the moment of decedent’s death, but who 

immediately received such property solely because of 

decedent’s death.” Garrett, 67 T.C.M. (CCH) at *13 (citing 

Englert, 32 T.C. 1016). Thus, a taxpayer who becomes 

trustee of a trust on the date of decedent’s death is 

“personally liable as a transferee for the estate tax because it 

was in possession of property includable in decedent’s gross 

estate at the date of death.” Id. at *14 (citing Estate of 

Callahan v. Comm’r, 42 T.C.M. (CCH) 362 (1981)). 

Although Congress amended § 6324 in 1966, it did not 

change the syntax of § 6324(a)(2). This indicates that 

Congress intended to keep the then-current judicial 

interpretation. See Lorillard v. Pons, 434 U.S. 575, 580 

(1978) (“Congress is presumed to be aware of an 

administrative or judicial interpretation of a statute and to 

adopt that interpretation when it re-enacts a statute without 

change.” (citations omitted)). 

B

In this case, the estate elected to defer payments over 

fourteen years. But the government failed to use the options 

available to protect its unsecured interests in deferred 

payments. See supra, at 59. It also failed to hold Michael 

Paulson, the trustee of the decedent’s trust on the date of the 

decedent’s death, personally liable for the estate taxes due, 

United States v. Paulson, 445 F. Supp. 3d 824, 831 (S.D. 

Cal. 2020), even though such liability may extend after the 

expiration of the ten-year estate tax lien provided for in 

§ 6324(a)(1). See, e.g., Internal Revenue Manual 5.5.8.3 

(June 23, 2005) (stating that 26 U.S.C. § 6502 applies to 
62 UNITED STATES V. PAULSON

assess personal liability under § 6324(a)(2)); 26 U.S.C. 

§ 6502(a) (providing for ten-year period after assessment of 

taxes for collection); Id. § 6503(d) (tolling ten-year period 

when 26 U.S.C. § 6166 election is made). 

To compensate for its failures to use the available 

statutory options to collect estate taxes, the government here 

adopted a novel reading of § 6324(a)(2). Although the 

accepted reading of this language (as noted in Garrett, 67 

T.C.M. (CCH) at *14) is that it imposes personal liability for 

estate taxes on any person who receives (or has) property on 

the decedent’s date of death, the government for the first 

time reads this language as imposing liability on a person 

“who receives” property of the estate at any time, even years 

after the decedent’s death. Under this interpretation, the 

government calculates the estate tax based on the value of 

property on the date of decedent’s death, and then imposes 

personal liability for this tax on a person who receives the 

property years later. This means that the individual’s tax 

liability may be completely disproportionate to the value of 

the property when the individual eventually receives it.

The majority justifies its adoption of the government’s 

novel reading based on the lack of a comma after the word 

“has.” The majority views the absence of a comma as 

triggering the doctrine of the last antecedent, a rule of 

statutory construction which states that “a limiting clause or 

phrase . . . should ordinarily be read as modifying only the 

noun or phrase that it immediately follows.” Lockhart v. 

United States, 577 U.S. 347, 351 (2016) (citation omitted). 

But while “[p]unctuation is a permissible indicator of 

meaning,” Navajo Nation v. U.S. Dep’t of Interior, 819 F.3d 

1084, 1093 (9th Cir. 2016) (citing Antonin Scalia & Bryan 

A. Garner, READING LAW: THE INTERPRETATION OF LEGAL 

TEXTS 161–65 (2012)), it “can assuredly be overcome by 
UNITED STATES V. PAULSON 63

other indicia of meaning,” Barnhart v. Thomas, 540 U.S. 20, 

26 (2003) (citation omitted). The “last antecedent principle 

is merely an interpretive presumption based on the 

grammatical rule against misplaced modifiers.” Payless 

Shoesource, Inc. v. Travelers Cos., Inc., 585 F.3d 1366, 

1371–72 (10th Cir. 2009). “At the same time, though, we 

know that grammatical rules are bent and broken all the 

time,” and we should not rely solely on grammar in 

interpreting a text “when evident sense and meaning require 

a different construction.” Id. (citation and internal quotation 

marks omitted). 

Like other circuits, we have acknowledged that the last 

antecedent canon is inapplicable when it creates illogical 

results and the statute’s plain language gives rise to a more 

logical reading. See One Sentinel, 416 F.3d at 979. In One 

Sentinel, the government brought a civil forfeiture action 

against a Sentinel Arms Striker-12 shotgun on the ground 

that it was “a ‘destructive device’ possessed in violation of 

the National Firearms Act.” Id. at 978. The Act defined a 

destructive device as 

any type of weapon by whatever name known 

which will, or which may be readily 

converted to, expel a projectile by the action 

of an explosive or other propellant, the barrel 

or barrels of which have a bore of more than 

one-half inch in diameter, except a shotgun 

or shotgun shell which the Secretary finds is 

generally recognized as particularly suitable 

for sporting purposes[.]

Id. at 979 (citing 26 U.S.C. § 5845(f)(2)) (emphasis and 

alteration in original). 
64 UNITED STATES V. PAULSON

The claimant argued that “according to the doctrine of 

the last antecedent, the clause ‘which the Secretary finds is 

generally recognized as particularly suitable for sporting 

purposes,’ modifies ‘shotgun shell,’ but not ‘shotgun.’” Id. 

In other words, due to the lack of a comma after “or shotgun 

shell” the doctrine of the last antecedent required the statute 

to be read as defining a destructive device as “any type of 

weapon . . . except a shotgun.” Id. 

We rejected that argument because following the last 

antecedent doctrine would have created the illogical result 

that no shotgun could be a “destructive device.” Id. We 

explained that “the doctrine of the last antecedent must yield 

to the most logical meaning of a statute that emerges from 

its plain language and legislative history.” Id. at 979 

(citation and quotation marks omitted). Therefore, we 

declined to apply the last antecedent canon and interpreted 

the relevant clause as if an omitted comma after “shell” were 

included. Id. 

The same principle applies here. The government and 

majority implicitly concede that the government’s reading of 

the statute potentially results in allowing the government to 

impose personal liability for unpaid estate taxes on trust 

asset recipients in excess of the value of the assets received. 

This could occur under the government’s interpretation, for 

instance, if property of the estate had a high value at the time 

of the decedent’s death but decreased precipitously by the 

time it was received by a beneficiary. In such a case, the 

beneficiary would nevertheless be personally liable for the 

unpaid estate taxes based on the value of the property on the 

date of death, even if the property were worth mere cents on 

the dollar when received by the beneficiary. Congress could 

not have intended to make a person who receives property 
UNITED STATES V. PAULSON 65

many years after a settlor’s death personally liable for estate 

taxes that exceed the value of the property received. 

The majority claims the taxpayers “are impliedly 

invoking the canon against absurdity,” and then refutes this 

strawman argument by pointing to the “high bar” for 

invoking this canon. But because the canon against 

absurdity applies only when a court departs from the plain 

meaning of a statute, see, e.g., Lamie v. U.S. Tr., 540 U.S. 

526, 534 (2004); Taylor v. Dir., Off. of Workers Comp. 

Programs, 201 F.3d 1234, 1241 (9th Cir. 2000), it is not 

implicated here. The taxpayers do not ask the court to 

disregard the text of § 6324(a)(2). Rather, the taxpayers 

offer an interpretation of its text that is superior to the 

government’s, in that it avoids an illogical reading based 

solely on the lack of a comma after the word “has.” See

Tovar v. Sessions, 882 F.3d 895, 904–05 (9th Cir. 2018).

C

While the majority primarily focuses on the doctrine of 

the last antecedent to support its interpretation of 

§ 6324(a)(2), it makes an additional textual argument. First, 

it correctly notes that the statute refers to a person who 

receives “property included in the gross estate under sections 

2034 to 2042, inclusive.” Likewise, it correctly notes that 

§§ 2034 to 2042 refer to property such as annuities, life 

insurance proceeds, or property subject to a general power 

of appointment given to transferees listed in § 6324(a)(2). 

From these undisputed premises, the majority erroneously 

concludes that a transferee could not receive the sort of 

property described in §§ 2034 to 2042 on the date of the 

decedent’s death, and therefore “personal liability for the 

estate tax applies to those who receive estate property, on or 

after the date of the decedent’s death.” 
66 UNITED STATES V. PAULSON

But the taxable property in the decedent’s gross estate, 

which includes the interest in the annuity, insurance 

proceeds, or property subject to a power of appointment, can 

be transferred on the date of decedent’s death. Indeed, as a 

leading treatise explains, “[n]on-probate assets 

under Section 6324(a)(2) [the assets identified in §§ 2034 

to 2042] are primarily those assets of the decedent, 

includable in the gross estate, that were transferred prior to 

death, or were held in such a way that ownership transferred 

automatically upon death.” William Elliott, FEDERAL TAX 

COLLECTIONS, LIENS & LEVIES, at § 27:23 Transferee 

Liability (Dec. 2022). A taxpayer receives the interest in the 

property “immediately” on the date of death, and is liable for 

estate taxes on its value, even if the assets at issue are not 

distributed until later. Garrett, T.C.M. (CCH) at *13 

(“Congress used the word ‘receives’ to take care of property 

solely because of decedent’s death such as insurance 

proceeds or property which was not in the possession of one 

of the persons described [in the predecessor to § 6324(a)] at 

the moment of decedent’s death, but who immediately 

received such property solely because of decedent’s death.” 

(citation omitted)). The transferees are personally liable to 

the extent of the value of their interest in these assets on the 

date of death. See Elliott, supra at § 27:23 Transferee 

Liability. And the present value of such interest is 

determined as of the date of death even if the actual annuity 

payments or insurance proceeds are not distributed until 

some later date. See Magill v. Comm’r, 43 T.C.M. (CCH) 

859, at n.21 (1982), aff'd sub nom. Berliant v. Comm'r, 729 

F.2d 496 (7th Cir. 1984) (holding that a taxpayer’s “liability 

under section 6324(a)(2) is measured by the value of the 

property at date of death,” and so the taxpayers would 

normally be personally liable for the value of their interest 
UNITED STATES V. PAULSON 67

in the annuity at the date of death, “rather than the lesser 

amount of the subsequent cash distributions”); see also 

Baptiste v. Comm’r, 63 T.C.M. (CCH) 2649 (1992), aff’d, 

29 F.3d 1533 (11th Cir. 1994) (“[P]etitioner is liable at law 

for the unpaid estate tax to the extent of the value, at the time 

of decedent’s death, of petitioner’s interest in the proceeds 

of insurance on decedent’s life.”). 

D

As an alternative to its textual arguments, the majority 

attempts to defend its interpretation by predicting that its 

illogical results are unlikely to occur.2 But the majority cites 

no support for its approach of interpreting statutes based on 

predictions regarding future events. Nor can it, because our 

job is merely to discern the most reasonable interpretation of 

the statute, which requires us to take into account its “most 

logical meaning.” One Sentinel, 416 F.3d at 979 (citation 

and quotation marks omitted). 

In any event, the majority’s assurances are unpersuasive, 

even on their own terms. First, the majority claims that the 

illogical result caused by the government’s interpretation 

can be avoided because an individual poised to receive trust 

assets “must not have disclaimed or refused [trust] 

property.” In other words, according to the majority, 

prospective recipients of trust assets are amply protected 

because they can simply refuse assets that will suffer too 

great a decrease in value. 

The majority’s argument does not survive scrutiny. 

Federal disclaimer law applies in this context. See 26 U.S.C. 

§ 2518 (disclaimers); Treasury Reg. § 25.2518-2(c)(5); see 

2 Once again, the government does not raise this argument.
68 UNITED STATES V. PAULSON

also Borris Bittker & Lawrence Lokken, FEDERAL 

TAXATION OF INCOME, ESTATES AND GIFTS ch. 121.7 

Disclaimers, 1997 WL 440123, at 14 (July 2022). Under 

federal law, in order to make an effective disclaimer of an 

interest in property, a person must comply with strict 

requirements. 26 U.S.C. § 2518; Treasury Reg. § 25.2518-

2. With some minor exceptions not applicable here, the 

person must make, in writing, “an irrevocable and 

unqualified” refusal to accept an interest in property, no later 

than nine months after the date of the decedent’s death 

regardless whether the person has received the property.3

 

See Treasury Reg. § 25.2518-2(a)–(c); see also id. 

§ 25.2518-2(c)(3)(i) (“With respect to transfers made by a 

decedent at death or transfers that become irrevocable at 

death, the transfer creating the interest occurs on the date of 

the decedent’s death, even if an estate tax is not imposed on 

the transfer); see also Barker v. Jackson Nat. Life Ins. Co., 

888 F. Supp. 1131, 1133–34 (N.D. Fla. 1995) (“Section 

25.2518–2(c)(3) key[s] the disclaimer time (9 months) to run 

from the taxable transfer occurring at the date of death.” 

(cleaned up)). The person must make this disclaimer within 

the nine month period even if the person has only a 

contingent interest in the property. Treasury Reg. 

§ 25.2518-2(c)(3)(i) (“If the transfer is for the life of an 

income beneficiary with succeeding interests to other 

persons, both the life tenant and the other remaindermen, 

3 There are two exceptions to this rule. A beneficiary who is under 21 

years of age has until nine months after his twenty-first birthday in which 

to make a qualified disclaimer of his interest in property. 26 C.F.R. § 25-

2518-2(d)(3). And a person who receives the property as the result of 

another party disclaiming the property interest must disclaim the interest 

within nine months after the date of the transfer creating the interest in 

the preceding disclaimant. 26 C.F.R. § 25-2518-2(c)(3).
UNITED STATES V. PAULSON 69

whether their interests are vested or contingent, must 

disclaim no later than 9 months after the original transfer 

creating an interest.”); see also Breakiron v. Gudonis, 2010 

WL 3191794, at *1 (D. Mass. Aug. 10, 2010) (“Under 

Treasury Regulation 26 C.F.R. § 25.2518-2(c)(3)(i), . . . a 

disclaimer must be made within this nine-month ‘window’ 

even if the disclaimant’s interest in the disclaimed property 

is not then vested or is then contingent.” (cleaned up)). This 

requirement applies regardless whether the person had actual 

knowledge that such a transfer had been made. See Bittker 

& Lokken, at 7 (“The disclaimant’s knowledge of the 

interest or lack thereof is irrelevant, and the time thus can 

expire before the disclaimant even knows of the existence of 

the interest.”).

The majority fails to explain how a person would have 

the prescience to know within nine months from the date of 

decedent’s death that the value of the interest in property to 

be transferred to that person at some point in the future will 

dramatically decline many years later (assuming that person 

even knows of the existence of such an interest). Without 

this prescience, the person would not be able to disclaim 

such an asset within the required time frame. At bottom, a 

person’s right to disclaim an asset within nine months of 

decedent’s death does not avoid the result caused by the 

government’s and majority’s interpretation of the statute.

The majority also contends that it “rel[ies] on the 

government’s avowals in its briefing and at oral argument 

that estate tax liability cannot exceed the value of the 

property received.” According to the majority, this promise, 

coupled with “judicial estoppel, provides additional 

safeguards” against the unfair application of personal 

liability under §6324(a)(2). But the government’s actual 

statement on appeal—that it “has consistently argued in this 
70 UNITED STATES V. PAULSON

case that liability under § 6324(a)(2) is limited to the lesser 

of the unpaid estate tax liability or the value of the nonprobate property that the liable person had or received,”—is 

merely a description of how the government has argued this 

case. It does not represent the government’s interpretation 

of § 6324(a)(2) or any promise regarding its future actions.

But even if the government had offered an authoritative 

interpretation, the majority misunderstands how the doctrine 

of judicial estoppel (which the government does not raise) 

would apply in this case. Judicial estoppel is an equitable 

doctrine that generally “prevents a party from prevailing in 

one phase of a case on an argument and then relying on a 

contradictory argument to prevail in another phase.” New 

Hampshire v. Maine, 532 U.S. 742, 749 (2001) (quoting 

Pegram v. Herdrich, 530 U.S. 211, 227 n.8 (2000)). “Courts 

apply the doctrine where a party’s ‘later inconsistent 

position’ presents a ‘risk of inconsistent court 

determinations.’” New Edge Network, Inc. v. FCC, 461 F.3d 

1105, 1114 (9th Cir. 2006). The doctrine is “invoked by a 

court at its discretion” to “protect the integrity of the judicial 

process.” Russell v. Rolfs, 893 F.2d 1033, 1037 (9th Cir. 

1990).

Judicial estoppel is not applicable here. In future cases, 

a court would be bound only by the majority’s interpretation 

of § 6324(a)(2) as imposing estate tax liability on a person 

who receives property from the decedent’s estate, regardless 

when it is received. The majority rejected an interpretation 

of the statute that would prevent the imposition of estate tax 

liability that exceeded the value of the property received, and 

so should the government change its position to argue the 

statute allows that, the government’s “later inconsistent 

position [would] introduce[] no ‘risk of inconsistent court 

determinations.’” New Hampshire v. Maine, 532 U.S. at 751 
UNITED STATES V. PAULSON 71

(citation omitted); see also New Edge Network, Inc., 461 

F.3d at 1114. Therefore, ordinary principles of judicial 

estoppel would not apply.

But even if the government had provided (and the 

majority had adopted) an interpretation of § 6324(a)(2) 

limiting the government’s ability to impose excessive estate 

tax liability, such an interpretation would still not be binding 

in future cases. “[I]t is well settled that the [g]overnment 

may not be estopped on the same terms as any other litigant” 

because public policy considerations allow the government 

to change its positions in ways private parties cannot. 

Heckler v. Cmty. Health Servs. of Crawford Cnty., Inc., 467 

U.S. 51, 60–61 (1984). The government may readily change 

its interpretation of a statute; “it suffices that the new policy 

is permissible under the statute, that there are good reasons 

for it, and that the agency believes it to be better.” FCC v. 

Fox Television Stations, Inc., 556 U.S. 502, 515 (2009). 

Because the government is free to make changes “in 

response to changed factual circumstances, or a change in 

administrations.” Nat’l Cable & Telecomm. Ass’n v. Brand 

X Internet Servs., 545 U.S. 967, 981–82 (2005) (citation 

omitted), we have held that judicial estoppel does not 

preclude a government agency from changing its 

interpretation of an ambiguous statute, see New Edge 

Network, 461 F.3d at 1114. Accordingly, principles of 

judicial estoppel would not avoid the illogical results caused 

by the government’s (and majority’s) interpretation of the 

statute. 

Finally, instead of explaining why its statutory 

interpretation does not lead to a nonsensical result, the 

majority also argues that historically, the government has not 

“attempted to impose personal liability for estate taxes that 

exceeded the value of the property received.” Even if this 
72 UNITED STATES V. PAULSON

were true, it indicates only that the government has managed 

up until now to use special liens or surety bonds to secure its 

interest, but does not establish that the government’s 

interpretation of § 6324(a)(2) is reasonable.

II

The majority has overemphasized a single canon of 

statutory construction—the rule of the last antecedent—to 

ignore that “fundamental canon of statutory construction that 

the words of a statute must be read in their context and with 

a view to their place in the overall statutory scheme.” FDA 

v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 133 

(2000) (citing Davis, 489 U.S. at 809). Although the 

punctuation chosen by Congress is important, we must also 

give due regard to sense and meaning. As our sister circuit 

has explained, “while the rules of English grammar often 

afford a valuable starting point to understanding a speaker’s 

meaning, they are violated so often by so many of us that 

they can hardly be safely relied upon as the end point of any 

analysis of the parties’ plain meaning.” Payless Shoesource, 

Inc., 585 F.3d at 1372. Our binding precedent requires this 

approach; we may not read a statute as defining a 

“destructive device” to include shotgun shells but not 

shotguns merely because of a misplaced comma. One 

Sentinel, 416 F.3d at 979. And the Tenth Circuit offers an 

example that speaks volumes: “Groucho Marx could joke in 

Animal Crackers, ‘One morning I shot an elephant in my 

pajamas. How he got into my pajamas I’ll never know,’ 

leaving his audience at once amused by the image of a 

pachyderm stealing into his night clothes and yet certain that 

Marx meant something very different.” Payless Shoesource, 

Inc., 585 F.3d at 1372. Because I would interpret the statute 

according to the most likely intent of Congress, rather than 
UNITED STATES V. PAULSON 73

adopt the majority’s mechanical adherence to the rule of the 

last antecedent, I respectfully dissent.