The opinion
IN THE OREGON TAX COURT
MAGISTRATE DIVISION
Income Tax
BRANDON D. ACKER, )
)
Plaintiff, ) TC-MD 120056C
)
v. )
)
DEPARTMENT OF REVENUE, )
State of Oregon, )
)
Defendant. ) DECISION
This matter is before the court on cross-motions for summary judgment. Plaintiff filed a
written motion on April 23, 2012, and Defendant filed a cross-motion on April 27, 2012. The
court heard oral argument at a hearing held by telephone on May 9, 2012. Plaintiff was
represented by Terry A. Slead, Certified Public Accountant (Slead). Defendant was represented
by Sandi Lyon, an auditor for the Department of Revenue.
I. STATEMENT OF FACTS
Plaintiff has lived and worked overseas in the Czech Republic since October 2006. (Ptf’s
Mot at 1.) Plaintiff filed a 2007 nonresident Oregon income tax return (Oregon Form 40N)
received by Defendant on April 8, 2008. (Id.) The return reported a tax due which Plaintiff paid
at the time the return was filed. (Def’s Cross Mot for Summ J at 2.) That return was prepared by
a tax preparer in Central Point, Oregon. (Ptf’s Mot at 1.) Plaintiff subsequently learned from
Slead that he qualified for two beneficial tax programs: (1) a foreign earned income exclusion on
his United States income tax returns, and (2) an income exclusion for non-Oregon source
income.1 (Id. at 2.) Accordingly, Plaintiff filed amended federal and state income tax returns on
1
Plaintiff became a client of Slead in 2010, and while Slead was preparing Plaintiff’s 2009 tax return she
reviewed Plaintiff’s 2007 and 2008 returns and advised Plaintiff that the returns were incorrect and should be
amended. (Ptf’s Motion at 2.)
DECISION TC-MD 120056C 1
June 15, 2011. (Id.) Defendant received Plaintiff’s amended 2007 return on June 17, 2011, and
agrees that it was “filed” on June 15, 2011. (Def’s Cross Mot for Summ J at 2.) Plaintiff’s
amended 2007 Oregon Form 40N reported a refund of $2,159. (Ptf’s Mot at 1.)
Defendant issued a Notice of Proposed Refund Adjustment on October 17, 2011. (Ptf’s
Compl at 4.) That notice indicated that the refund claim was being denied because, “[u]nder
Oregon law, you only have three years from the due date of return to file for a refund. * * *
Because you filed too late, we can’t issue a refund or use it to pay tax for another year.
ORS 314.415(2)(a).” (Id.)
II. ANALYSIS
Plaintiff acknowledges the statutory three-year refund rule under ORS 314.415(2)(a) but
insists that Plaintiff’s amended 2007 Oregon return was filed within the three-year statutory
period because Treasury Regulation 1.6081-5 provides for an automatic two-month extension for
the filing of a federal tax return, making the due date for his 2007 return June 15, 2008. (Ptf’s
Motion at 2.) Plaintiff argues that ORS 314.385 provides in part that returns filed with the
Oregon Department of Revenue shall be filed on or before the due date of the corresponding
federal return for the tax year at issue as prescribed under the Internal Revenue Code and the
regulations adopted pursuant thereto. (Id.) Plaintiff alleges that under ORS 305.270, the claim
for refund shall be filed within the period specified in ORS 314.415(2)(a), that the period
specified in that latter statute is three years from the due date of the original return, and that
Plaintiff’s amended return was filed within that three-year window because the original return
due date was automatically extended to June 15. (Id.)
///
///
DECISION TC-MD 120056C 2
A. Relevant statutes and treasury regulation
ORS 314.415(2)(a)2 states in pertinent part that:
“The department may not allow or make a refund after three years from the time
the return was filed, or two years from the time the tax (or a portion of the tax)
was paid, whichever period expires later, unless before the expiration of this
period a claim for refund is filed by the taxpayer in compliance with
ORS 305.270.”
(Emphasis added.) ORS 314.385(1) states that “returns shall be filed with the Department of
Revenue on or before the due date of the corresponding federal return.” Defendant “may allow
further time for filing returns equal in length to the extension periods allowed under the Internal
Revenue Code and its regulations.” Id.
Plaintiff claims that under Treasury Regulation 1.6081-5 (§ 1.6081-5) “the due date for
filing individual income tax returns (and incidentally for the payment of the tax as well) is
June 15 for taxpayers who reside overseas on April 15.” (Ptf’s Motion at 2.) The regulation
states in relevant part that:
“(a) An extension of time for filing returns of income and for paying any tax
shown on the return is hereby granted to and including the fifteenth day of the
sixth month following the close of the taxable year in the case of—
*****
(5) United States citizens or residents whose tax homes and abodes, in a real and
substantial sense, are outside the United States and Puerto Rico; []
*****
(b) In order to qualify for the extension under this section—
(1) A statement must be attached to the return showing that the person for whom
the return is made is a person described in paragraph (a) of this section; []”
Treas Reg 1.6081-5 (2012) (as amended by TD 8312, Sept 10, 1990).3
///
2
All references to the Oregon Revised Statutes (ORS) and the Internal Revenue Code (IRC) are to 2005.
3
Treasury regulations are the authoritative interpretation of the Internal Revenue Code so long as they are
reasonable. Cottage Sav. Ass’n v. Comm’r, 499 US 554, 560-61, 111 S Ct 1503, 113 L Ed 2d 589 (1991).
DECISION TC-MD 120056C 3
B. Due date
The court’s task in interpreting a federal statute “is to identify and carry out the intent”
behind its creation. Shaw v. PACC Health Plan, Inc., 322 Or 392, 400, 908 P2d 308 (1995)
(citing Pilot Life Ins. Co. v. Dedeaux, 481 US 41, 45, 107 S Ct 1549, 95 L Ed 2d 39 (1987)).
The extension provided by § 1.6081-5 was created with the intention of allowing citizens living
abroad additional time to file their income tax returns because it was recognized that these
citizens may have difficulty filing by April 15. See TD 8312, Sept 10, 1990. This recognized
difficulty would presumably apply to citizens living abroad in meeting a three year deadline for
filing as well. However, the due date for filing Oregon returns is prescribed by Oregon statute,
and in interpreting an Oregon statute the court cannot “insert what has been omitted, or [] omit
what has been inserted.” PGE v. Bureau of Labor and Industries, 317 Or 606, 611, 859 P2d
1143 (1993), citing ORS 174.010.
Although ORS 314.385(1)(c) states that Defendant “may allow further time for filing
returns equal in length to the extension periods allowed under the Internal Revenue Code and its
regulations,” (emphasis added), ORS 314.415(2)(a) states that Defendant “may not allow or
make a refund after three years from the time the return was filed.” (Emphasis added.) Plaintiff
filed his original return on April 8, 2008. (Ptf’s Mot at 1.)
The term “filed” is not defined in ORS 314.415(2)(a); however, ORS 314.011(2)(a) states
that “[a]ny term [used in this chapter] has the same meaning as when used in a comparable
context in the laws of the United States relating to federal income taxes, unless a different
meaning is clearly required or the term is specifically defined in this chapter.” In the comparable
federal context, Internal Revenue Code (IRC) section 6511(a) states that a “[c]laim for credit or
refund * * * shall be filed by the taxpayer within 3 years from the time the return was filed,” and
DECISION TC-MD 120056C 4
IRC section 6513(a) states that “[f]or purposes of section 6511, any return filed before the last
day prescribed for the filing thereof shall be considered as filed on such last day.”
26 USC § 6511(a); 26 USC § 6513(a). Therefore, Defendant could only allow Plaintiff to file a
refund request until April 15, 2011, three years from the time Plaintiff’s original return was
“filed.” Plaintiff’s original 2007 return was filed with Defendant on April 8, 2008 and is deemed
under IRC sections 6511 and 6513 to have been filed on April 15, 2008. Plaintiff did not file his
amended return until June 15, 2011, two months after the three-year deadline, and therefore the
time limitations of ORS 314.415(2)(a) prevented Defendant from issuing a refund.
Plaintiff claims that the statutory period for amending his return began on June 15, 2008,
the date he alleges was the prescribed filing date for his original return because of the two-month
extension provided under § 1.6081-5. (See Ptf’s Motion at 2.) However, an extension of a due
date does not move the due date, a distinction well illustrated through an examination of the
Oregon Tax Court case Day v. Department of Revenue (Day), TC No 4892, WL 4880663
(Nov 30, 2010). In Day, the original filing due date for Plaintiff’s federal return was
April 15, 2004. WL 4880663 at *3. However, when the federal filing due date three years
subsequent was moved to April 17, because April 15 fell on a Sunday and April 16 was a
holiday,4 the corresponding Oregon filing due date under the three year refund rule in
ORS 314.415(2)(a) was also April 17. Id. In Day, the filing due date was moved, not extended.
Here, in contrast, Plaintiff was granted “an extension of time” under § 1.6081-5; the filing due
date, however, remained April 15.
An examination of § 1.6081-5 further supports this conclusion. The two-month extension
for citizens living abroad provided under § 1.6081-5 is “hereby granted,” and receiving the
extension requires only that a statement be attached to the return, showing that “the person for
4
Emancipation Day.
DECISION TC-MD 120056C 5
whom the return is made” is a United States citizen whose tax home is outside the United States.
See Treas Reg 1.6081-5(b)(1) (2012). This statement, as well as the payment of any tax due,
need not be submitted until June 15. See Treas Reg 1.6081-5 (2012).
However, the declaratory language granting the extension combined with the ease in
which citizens living abroad may apply serve only to reinforce the automatic nature of the
extension, not to denote an altered due date. Furthermore, although § 1.6081-5 extends the date
for payment of any federal income tax due, citizens living abroad must pay interest beginning
April 15 until such taxes are paid. See “Tax Guide for U.S. Citizens and Resident Aliens Living
Abroad,” IRS Pub 54 (Dec 2011), available at http://www.irs.gov/pub/irs-pdf/p54.pdf.
IRC section 6601(a) states that “[i]f any amount of tax * * * is not paid on or before the last date
prescribed for payment, interest on such amount * * * shall be paid for the period from such last
date to the date paid.” 26 USC § 6601(a). IRC section 6601(b)(1) states that “[t]he last date
prescribed for payment shall be determined without regard to any extension of time for
payment[.]” 26 USC § 6601(b)(1). Therefore, as the date on which interest begins to accrue,
April 15 is also the prescribed date for the payment of taxes due. The aforementioned IRC
sections do not establish an April 15 filing due date. However, they do establish that taxes shall
be paid on April 15, and IRC section 6151(a) states that “* * * when a return of tax is required
under this title or regulations, the person required to make such return * * * shall pay such tax at
the time and place fixed for filing the return (determined without regard to any extension of time
for filing the return).” 26 USC § 6151(a). (Emphasis added.) Therefore, it follows that April 15
is also the prescribed date for filing a return.
In sum, although § 1.6081-5 allows citizens living abroad to file federal income tax
returns and pay taxes due by June 15, the due date of both remains April 15. Therefore,
DECISION TC-MD 120056C 6
Plaintiff’s original filing due date for his Oregon income tax return was April 15, 2008, as
“returns shall be filed with the Department of Revenue on or before the due date of the
corresponding federal return.” ORS 314.385.
III. CONCLUSION
Treasury Regulation section 1.6081-5 does not alter the due date for federal income tax
returns for United States citizens living abroad but instead provides those citizens with an
extension of time for filing and for paying taxes due. ORS 314.415(2)(a) prohibits Defendant
from allowing or making a refund “after three years from the time the return was filed.”
Plaintiff’s claim for refund was not filed within three years of the due date of the original return
and thus was appropriately denied.
Now, therefore,
IT IS THE DECISION OF THIS COURT that Defendant’s Motion for Summary
Judgment is granted and Plaintiff’s Motion for Summary Judgment is denied.
Dated this day of August 2012.
DAN ROBINSON
MAGISTRATE
If you want to appeal this Decision, file a Complaint in the Regular Division of
the Oregon Tax Court, by mailing to: 1163 State Street, Salem, OR 97301-2563;
or by hand delivery to: Fourth Floor, 1241 State Street, Salem, OR.
Your Complaint must be submitted within 60 days after the date of the Decision
or this Decision becomes final and cannot be changed.
This document was signed by Magistrate Dan Robinson on August 10, 2012.
The Court filed and entered this document on August 10, 2012.
DECISION TC-MD 120056C 7