United States District Court, D. Massachusetts
BIRGER ENGINEERING, INC.
UNITED STATES OF AMERICA
MEMORANDUM OF DECISION AND ORDER ON DEFENDANT'S
MOTION TO DISMISS
RICHARD G. STEARNS UNITED STATES DISTRICT JUDGE.
December 5, 2012, Birger Engineering, Inc. (Birger) sent the
Internal Revenue Service (IRS) a check for $25, 252.74 to
settle a 2009 tax assessment. After determining that the
assessment had been mistakenly imposed, Birger filed a Form
941-X on November 26, 2014, seeking a refund. In May of 2015,
the IRS notified Birger that it had approved the claim and
that Birger would be repaid in full, with interest. Seven
months later, in January of 2016, having not received the
refund, Birger contacted the IRS and was told that the
payment had been placed on hold. At the direction of the IRS,
Birger prepared and filed a Form 843 regarding the erroneous
2009 assessment. Separately, Birger filed a Form 941-X
seeking a $14, 860.95 refund for an allegedly incorrect 2011
IRS assessment, which Birger had paid in February of 2014.
Once again, the IRS directed Birger to file a Form 843, and
Birger complied. The IRS subsequently denied the 2009 claim
as untimely, and has declined to issue a decision regarding
Birger's 2011 claim. Birger filed this Complaint against
the United States in the federal district court. Before the
court is the government's motion to dismiss.
First Refund Claim
August 1, 2011, the IRS “made a tax assessment on
Birger in the amount of $25, 322.95.” Compl. ¶ 5.
Thereafter, several credit adjustments reduced this initial
tax assessment to zero. Id. ¶¶ 6-7.
However, the IRS subsequently reassessed Birger for the same
amount. Id. ¶¶ 8-9. Under the
“threat of property seizure, ” Birger paid the
second assessment t0 the IRS by a check dated December 5,
2012. Pl.'s Opp'n, Dkt. #21 at 2; Compl. ¶ 11.
November 26, 2014, Birger filed a Form 941-X (Adjusted
Employer's Quarterly Federal Tax Return or Claim for
Refund) to claim a refund of the second assessment, stating
that it “made an extra payment due to a repetitive IRS
assessment that had previously been credited in full, ”
and that the “IRS erroneously made duplicate
assessments for the quarters 9/30/2009 and 12/31/2009.”
Id. ¶ 13.
4, 2015, the IRS notified Birger in writing that it had
approved the November of 2014 claim and that it would pay
Birger a full refund, including interest and penalty
decreases, for a total of $29, 784.22. Id. ¶
15. Birger never received the refund, and on January 13,
2016, “counsel for Birger contacted the IRS to inquire
about the status of Birger's refund check.”
Id. ¶ 17. An IRS employee told counsel that the
refund had been placed on hold “pending a review by the
statute of limitations section.” Id. The
employee also directed Birger to prepare a Form 843 (Claim
for Refund and Request for Abatement), which Birger completed
and filed on January 21, 2016. Id. ¶ 19.
February 17, 2016, the IRS informed Birger by letter that the
refund claim “was disallowed because it was filed more
than two years after the payment of the tax.”
Id. ¶ 20. Birger's subsequent appeal was
denied on December 5, 2017. Id. ¶ 22.
Second Refund Claim
internal accounting error gave rise to Birger's second
refund claim. Id. ¶ 30. In 2011, Birger's
payroll company inadvertently attributed $11, 992.96 in tax
payments to the company's fourth quarter (Q4), when the
“amount should have been credited to” its third
quarter (Q3). Id. ¶¶ 29-31. Accordingly,
although “too much had been paid in Q4 and too little
was paid in Q3, ” “Birger's withholding and
trust taxes due for 2011 had been paid in full by the end of
Q4 2011.” Id. ¶ 32.
November 11, 2013, the IRS assessed Birger for the shortfall
in 2011 Q3, not taking into account that Birger had paid its
2011 tax liability in full in the final quarter of the year.
Id. ¶ 33. Birger, because of an accounting
oversight, did not recognize that the November 2013
assessment was redundant and paid the amount on February 12,
2014. Id. ¶¶ 34-36. On January 21, 2016,
having realized the mistake, Birger filed a Form 941-X
seeking a refund of the February of 2014 payment.
Id. ¶ 27. After an IRS employee informed the
company that a Form 843 was the proper avenue for relief,
Birger immediately prepared and filed the Form. Pl.'s
Opp'n at 7. To date, the IRS has not made a decision on
Birger's claim. Compl. ¶ 37.
February 7, 2018, Birger filed this Complaint in the federal
district court, seeking a full refund for both payments,
statutory interest, and attorneys' fees. Compl. at 8-9.
The government subsequently moved to dismiss, asserting that
Birger lacks standing to bring this action by operation of
the statute of limitations. See Fed. R. Civ. P.
is a prerequisite to a court's Article III authority to
adjudicate a case. See Baena v. KPMG LLP, 453 F.3d
1, 4 (1st Cir. 2006). “[A]t the pleading stage, the
plaintiff bears the burden of establishing sufficient factual
matter to plausibly demonstrate [its] standing to bring the
action.” Hochendoner v. Genzyme Corp., 823
F.3d 724, 731 (1st Cir. 2016). “While the court
generally may not consider materials outside the pleadings on
a Rule ...