Opinion ID: 40585
Heading Depth: 3
Heading Rank: 4

Heading: The Deatons' Remittance

Text: 26 The primary issue in this case is the impact of Baral and post- Baral law on the deposit-payment distinction. As discussed above, Baral abrogated the rule established in Mercantile National Bank. And the only post- Baral case to address the deposit-payment distinction used a facts-and-circumstances test to determine whether the remittance in question was a payment of estimated income tax under § 6513(b)(2) subject to Baral 's rule that payments of estimated income tax are deemed paid on the due date of the return without extension. Harrigill, 410 F.3d at 791-92. We have been called on here to decide what rule to apply post- Baral to characterize a remittance made in conjunction with a Form 4868 application for an extension of time to file. The alternatives offered are (1) a per se rule that all Form 4868 remittances are payments and (2) a facts-and-circumstances inquiry that would require a case-by-case analysis of any Form 4868 remittance made. 27 Like the Harrigill panel, we find it unnecessary to decide whether a Form 4868 remittance is a payment as a matter of law because we find that the Deatons' remittance of $125,000 in conjunction with their Form 4868 application for an extension of time to file constituted a payment of estimated income tax under § 6513(b)(2). We hesitate to adopt a per se rule in a case in which the record clearly indicates that the taxpayers' remittance was a payment, not a deposit, and we therefore decline to do so. We leave for another day the question of whether all Form 4868 remittances should be treated as payments of estimated tax, even though we recognize that several of our sister circuits have already answered this question in the affirmative. See Dantzler v. United States, 183 F.3d 1247, 1251 (11th Cir.1999); Ertman v. United States, 165 F.3d 204, 207 (2d Cir. 1999); Ott v. United States, 141 F.3d 1306, 1308-09 (9th Cir.1998); Gabelman v. Comm'r, 86 F.3d 609, 611-12 (6th Cir. 1996); Weigand v. United States, 760 F.2d 1072, 1074 (10th Cir.1985). We agree with the Tax Court that even under the facts-and-circumstances approach proposed by the Deatons, their $125,000 remittance must be considered a payment of estimated tax. See VanCanagan v. United States, 231 F.3d 1349, 1352-53 (Fed.Cir.2000). As such, their remittance is governed by a `deemed paid' provision and controlled by Baral. 28 In their 1993 Form 4868, the Deatons indicated that the amount [they] expect[ed] to list as their 1993 tax liability was $138,883 and that they had a balance due of $125,000. The Deatons remitted that $125,000. The Deatons submitted no contemporaneous evidence supporting their contention that they intended this amount to be a deposit when remitted; there is nothing on the face of the document or on the check submitted with it indicating such an intent. There is no evidence that the Deatons made an attempt to use the IRS procedure for making a deposit. In addition, there is no evidence suggesting that the Deatons were disputing their tax liability as in Rosenman. The IRS has always treated their overpayment as an excess collection. At best, the record suggests that the Deatons had difficulty estimating their tax liability and needed more time to file their 1993 tax return. That they had difficulty estimating their tax liability does not make their remittance of estimated tax a deposit of the kind recognized by Baral as retaining legal significance. Baral, 528 U.S. at 439 n. 2, 120 S.Ct. 1006. 29 We reject the Deatons' argument that in light of caselaw prevailing at the time of their remittance, we must presume that they intended to make a deposit. This argument requires that we find that they had actual or presumed knowledge of the prevailing law of this Circuit. They provide no factual evidence to support such a finding. Furthermore, the Deatons provide no legal authority to support their affirmative use of a presumption that a taxpayer knows the law. Such a presumption is normally reserved to the government in actions against taxpayers. See, e.g., Cheek v. United States, 498 U.S. 192, 199, 111 S.Ct. 604, 112 L.Ed.2d 617 (1991). The Deatons provide no principled reason for allowing the affirmative use of such a presumption against the government, and we refuse to invent such a reason here. 30 We hold that on the facts and circumstances of this case, the Deatons' remittance of $125,000 was an amount paid as estimated income tax under § 6513(b)(2), not a deposit. 11 Under that section, a remittance is deemed paid on the last day prescribed for filing the return under section 6012 for such taxable year . . . . I.R.C. § 6513(b)(2). Because the $125,000 was thus paid outside the look-back period of § 6511(b)(2)(A), the Deatons cannot recover their overpayment. I.R.C. § 6511(b)(2)(A).