When Is A Deadline Not A Deadline? The Supreme Court Intends To Decide

• Published date: 12 January 2022
• Subject Matter: Litigation, Mediation & Arbitration, Tax, Sovereign Immunity: Public Sector Government, Trials & Appeals & Compensation, Tax Authorities
• Law Firm: Alston & Bird
• Author: Laura Gavioli and George Abney

Executive Summary

Our Federal Tax Group investigates why the U.S. Supreme Court may use a Tax Court case to decide whether a statutory deadline is set in stone or if a court can permit an untimely suit to proceed through equitable tolling.

• The Tax Court ruled that a statutory deadline is jurisdictional; Eighth Circuit agrees
• Taxpayer access to the Tax Court is at stake
• The COVID-19 pandemic - and its attendant delays - has thrown the issue into the spotlight

Are taxpayers and other petitioners in Tax Court absolutely required to follow statutory deadlines to file suit? Or does the Tax Court have jurisdiction to hear an untimely filed case anyway, under a theory that the equities of the situation permit tolling of the relevant deadlines? On September 30, 2021, the U.S. Supreme Court granted certiorari in Boechler P.C. v. Commissioner, No. 20-1472, and is expected to provide answers to these questions.

In Boechler, the Eighth Circuit held that the statutory deadline of Section 6330(d)(1), regarding filing suit in Tax Court to challenge an adverse collection due process determination by the Internal Revenue Service, was jurisdictional. In so doing, the Eighth Circuit rejected the application of the doctrine of "equitable tolling," which may have permitted the untimely suit to proceed. Under the doctrine of equitable tolling, statutory deadlines may be suspended if a litigant can show that it diligently pursued available remedies but were unable to meet statutory deadlines due to circumstances beyond their control. As the Supreme Court has observed,

Federal courts have typically extended equitable relief only sparingly. We have allowed equitable tolling in situations where the claimant has actively pursued his judicial remedies by filing a defective pleading during the statutory period, or where the complainant has been induced or tricked by his adversary's misconduct into allowing the filing deadline to pass. We have generally been much less forgiving in receiving late filings where the claimant failed to exercise due diligence in preserving his legal rights.

Irwin v. Department of Veterans Affairs, 498 U.S. 89, 96 (1990).

Equitable tolling is much more common in litigation between private litigants. In suits against the government, however, federal courts have generally held that sovereign immunity limits the application of the equitable tolling doctrine. Accordingly, federal courts that have held statutory deadlines to be jurisdictional have also...