89tii Congress ) HOUSE OF REPRESENTATIVES ( D ocument

1st Session j j No. 301

CECIL GRAHAM

MESSAGE

X'KOM.

THE PRESIDENT OE THE UNITED STATES

RETURNING

WITHOUT APPROVAL THIO HILL (ILK. ) FOR THE RELIEF OF

CECIL GRAHAM

Octoher 7, 1905.—Referred to the Committee on the Judiciary, and ordered to

be printed

To the Home of Representatives:

T return herewith, without my approval, H.R. 5902, a bill for the 

relief of Cecil Graham.

The bill provides that, notwithstanding the statute of limitations, 

the claim of Mr. Graham for refund of Federal income taxes erroneously paid by him on disability payments received from the Civil 

Service Commission during the period 1947-55, if filed within 1 year, 

shall be treated by the Treasury Department as timely filed and be 

considered and paid in accordance with provisions of applicable law.

Mr. Graham was retired on April 1, 1947, for disability under the 

Civil Service Retirement Act. In 1948 he was advised by an employee 

of the Internal Revenue Service that his disability payments were 

includible in income. He paid income tax, it appears, for the years 

] 947-55 on these payments. Subsequently he learned that they 

were not taxable and applied for a refund, but the statute of limitations 

had run.

The advice given Mr. Graham in 1948 was accurate at that time. 

It was the Epmeier decision by the seventh circuit in 1952 which held 

that disability payments were excludable and put taxpayers on notice 

that they should file claims for refund if they had previously included 

such payments in income. The Internal Revenue Code adopted in

50-011
2 CECIL GRAHAM

1954 made it clear that disability payments for 1954 and subsequent 

years were excludable from income.

It is common knowledge that the tax law frequently changes. In 

our self-administered tax system, Mr. Graham, like all other taxpayers, had a responsibility for keeping informed.

The Congress has included a statute of limitations in tax laws in 

order to achieve uniform treatment and finality in tax administration. 

Any time limitation makes it inevitable that some claimants, often 

without fault, will fail to file their claims on time. A case such as this 

clearly demonstrates the wisdom of such a statute—it may be impossible to determine reliably the amount of any overpayment made 

by this taxpayer because the pertinent tax returns have been destroyed under existing procedures and in reliance upon the statute of 

limitations.

This bill is also inconsistent with the Technical Amendments Act 

of 1958, which granted some general relief to taxpayers who had 

erroneously included disability payments in income. By that 

statute, Congress granted relief to those who had asserted their rights 

by filing timely claims for refund, but withheld relief from taxpayers 

who, like Mr. Graham, had not filed timely.

A number of other bills for relief of individual taxpayers have been 

introduced in Congress where the taxpayers had failed to file timely 

claims for refunds and, therefore, were not covered by the 1958 

statute. President Eisenhower withheld his approval from two of 

these bills—H.R. 9765 (85th Cong.) and H.R. 6335 (86th Cong.). 

No others have been enacted. Thus, approval of this bill would 

discriminate against other taxpayers similarly situated and set an 

unfortunate precedent.

Accordingly, I am returning H.R. 5902 without my approval.

L yndon B. J ohnson.

T he White H ouse, October 4, 1965.

H.R. 5902

E ighty- n in t h C on g r ess of t h e U n it e d S tates of A m erica, a t t h e F irst

S e ssio n, B eg u n a nd H eld at th e City of W a sh ingto n on M o n d ay, the

F ourth D ay of Ja n u a r y , One T h o usa nd N in e H u n d r e d a nd S ix t y- five

AN ACT For the relief of Cecil Graham.

Be it enacted by the Senate and House of Representatives of the United States of

America in Congress assembled, That, notwithstanding the limitations of sections

322(b), 3774, and 3775 of the Internal Revenue Code of 1939, or of section 6511

(b)(2) of the Internal Revenue Code of 1954, relating to the refund of excess

income taxes or of any other statute of limitations, the claim of Cecil Graham of

Oklahoma City, Oklahoma, filed with the Treasury Department within one year

of the date of approval of this Act for the refund of Federal income taxes erroneously paid by him upon payments received from the United States Civil Service

Commission, Bureau of Retirement and Insurance, from April 1, 1947, through

November 15, 1955, shall be considered to have been timely filed and shall be

further considered and paid in accordance with the provisions of otherwise applicable provisions of law.

J ohn W . M cC ormack,

Speaker of the House of Representatives.

H u b e r t H . H u m ph r e y,

Vice President of the United States and

President of the Senate.

[Endorsement on back of bill:]

I certify that this Act originated in the House of Representatives.

R a lph R. R o b e r t s, Clerk.

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