Petition for Writ of Certiorari — Stephanie Murrin, Petitioner v. Commissioner of Internal Revenue
Supreme Court briefFeb 17, 2026
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No. ____
IN THE
Supreme Court of the United States
————
STEPHANIE MURRIN,
Petitioner,
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondents.
————
On Petition for a Writ of Certiorari to the
United States Court of Appeals
for the Third Circuit
————
PETITION FOR A WRIT OF CERTIORARI
————
DANIEL L. GEYSER
HAYNES AND BOONE, LLP
2801 N. Harwood Street,
Ste. 2300
Dallas, TX 75201
ANNE M. VOIGTS
Counsel of Record
PILLSBURY WINTHROP SHAW
PITTMAN LLP
2400 Hanover Street
Palo Alto, CA 94304
LAWRENCE A. SANNICANDRO (650) 233-4075
DARIANNE DE LEON
anne.voigts@pillsburylaw.com
PILLSBURY WINTHROP SHAW
Counsel for Petitioner
PITTMAN LLP
Stephanie Murrin
31 W. 52nd St
New York, NY 10019
February 17, 2026
WILSON-EPES PRINTING CO., INC. – (202) 789-0096 – WASHINGTON, D.C. 20002
QUESTION PRESENTED
This case presents a direct and acknowledged
conflict over an important question of federal tax law.
Under the Internal Revenue Code (Code), the Internal
Revenue Service (IRS) typically has three years from
the date a tax return is filed to assess tax. 26 U.S.C.
§ 6501(a). But Congress created an exception to that
three-year deadline for “false or fraudulent return[s]
with the intent to evade tax.” 26 U.S.C. § 6501(c)(1).
If that exception applies, the IRS can seek unpaid tax
at any time. In the decision below, the Third Circuit
held that this exception applies broadly—and the
government faces no enforcement deadline at all—if a
third-party tax return preparer (unbeknownst to the
taxpayer herself) intentionally prepared a “false or
fraudulent return with intent to evade tax.” Under
this rule, it makes no difference if a taxpayer is
entirely innocent and has no knowledge about, let
alone any participation in, any wrongdoing. In so
holding, the Third Circuit created a direct split with
the Federal Circuit, which held that § 6501(c)(1)
applies only when the taxpayer herself acted with
“intent to evade tax.” The decision below thus leaves
the meaning of a central limitations period of the Code
dependent on the forum in which a taxpayer litigates.
The question presented is:
Whether, under 26 U.S.C. § 6501(c)(1), the IRS
may assess tax beyond the Code’s three-year
limitations period based solely on the fraudulent
intent of a third-party, even when the taxpayer herself
neither intended to evade tax nor knew of any
wrongdoing.
i
RELATED PROCEEDINGS
United States Tax Court:
Stephanie Murrin v. Commissioner of
Internal Revenue, No. 14614-19 (Feb. 6,
2024)
United States Court of Appeals (3d Cir.):
Stephanie Murrin v. Commissioner of
Internal Revenue, No. 24-2037 (Aug. 18,
2025) (opinion and judgment)
Stephanie Murrin v. Commissioner of
Internal Revenue, No. 24-2037 (Oct. 17,
2025) (amended opinion on panel
rehearing; rehearing en banc denied)
ii
TABLE OF CONTENTS
Page
QUESTION PRESENTED ........................................... i
RELATED PROCEEDINGS ....................................... ii
TABLE OF CONTENTS ............................................ iii
TABLE OF AUTHORITIES ........................................ v
OPINIONS BELOW .................................................... 1
JURISDICTION .......................................................... 2
STATUTORY PROVISIONS INVOLVED .................. 2
INTRODUCTION ........................................................ 3
STATEMENT .............................................................. 5
I.
Legal Background .................................. 5
II.
Factual and Procedural Background..... 8
REASONS FOR GRANTING THE PETITION........ 11
I.
The Decision Below Creates a Direct and
Acknowledged Circuit Split Over the
Scope of 26 U.S.C. § 6501(c)(1). ........... 12
II.
The Question Presented Is Exceptionally
Important. ............................................ 18
III.
This Case Is an Ideal Vehicle for
Resolving the Question Presented. ..... 22
IV.
The Decision Below Converts a Narrow
Fraud Exception into a Regime of
Perpetual
Liability
for
Innocent
Taxpayers ............................................. 23
CONCLUSION .......................................................... 27
iii
APPENDIX A ............................................................ 1a
APPENDIX B .......................................................... 22a
APPENDIX C .......................................................... 42a
APPENDIX D ......................................................... 62a
APPENDIX E .......................................................... 64a
iv
TABLE OF AUTHORITIES
Page
Cases
Allen v. Comm’r,
128 T.C. 37 (2007) .................................................. 7
Badaracco v. Comm’r,
464 U.S. 386 (1984) .............................................. 25
Bartenwerfer v. Buckley,
598 U.S. 69 (2023) .................................... 10, 18, 25
BASR P’ship v. United States,
795 F.3d 1338 (Fed. Cir. 2015) .. 4, 7, 9, 13, 14, 15,
16, 17, 20
Flora v. United States,
362 U.S. 145 (1960) .............................................. 22
Hinck v. United States,
550 U.S. 501 (2007) .............................................. 21
Payne v. Comm’r,
224 F.3d 415 (5th Cir. 2000) .................................. 7
Raley v. Comm’r,
676 F.2d 980 (3d Cir. 1982).................................. 27
Stoltzfus v. United States,
398 F.2d 1002 (3d Cir. 1968)................................ 27
United States v. Updike,
281 U.S. 489 (1930) .............................................. 19
v
Statutes and Codes
United States Code,
Title 26, Section 6161 ........................................... 15
Title 26, Section 6201(a) .................................... 5, 6
Title 26, Section 6213(a) .................................. 8, 21
Title 26, Section 6404(h) ...................................... 21
Title 26, Section 6501 ....... 2, 6, 9, 13, 15, 22, 25, 26
Title 26, Section 6501(a) .............. 3, 6, 9, 13, 24, 25
Title 26, Section 6501(c) ............................. 6, 15, 17
Title 26, Section 6501(c)(1) .. 3, 4, 5, 6, 7, 9, 10, 11,
12, 13, 14, 15, 16, 17, 20, 22, 23, 24, 25, 26
Title 26, Section 6501(e)(1) .................................. 26
Title 26, Section 6663 ........................................... 11
Title 26, Section 6663(a) ...................................... 26
Title 26, Section 7442 ....................................... 8, 21
Title 26, Section 7454(a) ...................................... 27
Title 26, Section 7482(b) ...................................... 22
Title 26, Section 7701(a)(11) .................................. 5
Title 28, Section 1254(1) ........................................ 2
Title 28, Section 1295(a)(3) .................................. 22
Title 28, Section 1346(a)(1) .............................. 4, 22
Title 28, Section 1491(a) ........................................ 4
Internal Revenue Code,
Section 6161(b)(3) ................................................. 15
Revenue Act of 1918, Pub. L. No. 65–254, 40 Stat.
1057,
Section 250 ........................................................... 16
Section 250(b) ................................................... 6, 16
Section 250(d) ....................................... 6, 15, 16, 17
vi
In The Supreme Court of the United
States
_______________
STEPHANIE MURRIN, PETITIONER
v.
COMMISSIONER OF INTERNAL REVENUE
_______________
On Petition for a Writ of Certiorari
to the United States Court of Appeals
for the Third Circuit
_______________
PETITION FOR A WRIT OF CERTIORARI
_______________
Stephanie Murrin respectfully petitions for a
writ of certiorari to review the judgment of the United
States Court of Appeals for the Third Circuit in this
case.
OPINIONS BELOW
The amended opinion of the court of appeals
(App., infra, 1a–21a) is reported at 158 F.4th 527. The
original opinion of the court of appeals (App., infra,
22a–41a) is reported at 152 F.4th 136. The opinion of
the Tax Court (App., infra, 42a–61a) is unreported but
available at 2024 WL 263011.
1
JURISDICTION
The judgment of the court of appeals was
entered on August 18, 2025. A petition for panel
rehearing was granted in part on October 17, 2025,
and a petition for rehearing en banc was denied on the
same date (App., infra, 62a–63a). On January 6, 2026,
Justice Alito extended the time within which to file a
petition for a writ of certiorari until February 17, 2026.
The jurisdiction of this Court is invoked under 28
U.S.C. § 1254(1).
STATUTORY PROVISIONS INVOLVED
26 U.S.C. § 6501 provides in relevant part:
Limitations on assessment and collection
(a)
General rule
Except as otherwise provided in this section, the
amount of any tax imposed by this title shall be
assessed within 3 years after the return was filed
(whether or not such return was filed on or after the
date prescribed) or, if the tax is payable by stamp, at
any time after such tax became due and before the
expiration of 3 years after the date on which any part
of such tax was paid, and no proceeding in court
without assessment for the collection of such tax shall
be begun after the expiration of such period. For
purposes of this chapter, the term “return” means
the return required to be filed by the taxpayer (and
does not include a return of any person from whom the
taxpayer has received an item of income, gain, loss,
deduction, or credit).
2
* * * * *
(c)
Exceptions
(1)
False return
In the case of a false or fraudulent return with
the intent to evade tax, the tax may be assessed, or a
proceeding in court for collection of such tax may be
begun without assessment, at any time.
* * * * *
Additional relevant statutory provisions are
reproduced in the appendix to this petition (App.,
infra, 64a–72a).
INTRODUCTION
This case presents a square and acknowledged
conflict over an important and recurring question of
federal tax law. Under the Code, the IRS typically has
three years from the date a tax return is filed to assess
tax. 26 U.S.C. § 6501(a). But Congress created a
limited exception to the three-year deadline for “false
or fraudulent return[s] with the intent to evade tax.”
26 U.S.C. § 6501(c)(1). In that narrow circumstance,
the IRS’s deadline is set aside entirely, permitting the
IRS to seek unpaid taxes without temporal limit.
App., infra, 4a.
The question presented here is whether the IRS
can assess tax beyond the usual three-year deadline
when the taxpayer’s tax preparer intended to file a
false or fraudulent return, but the taxpayer herself had
no such intent and no knowledge of any wrongdoing.
3
The legal and practical stakes are significant. If read
too broadly, this provision destroys repose for
taxpayers who acted in good faith and complied with
their tax reporting obligations, unexpectedly trapping
innocent parties with sudden (and crushing) debt—all
while excusing government delay.
Yet in the
proceedings below, the Third Circuit adopted the IRS’s
position. In doing so, it exposed Murrin to tax,
penalties, and interest for returns filed over two
decades in the past—without any indication she had
knowledge of any wrongdoing. In reaching that
conclusion, the Third Circuit squarely rejected a
contrary 2-1 decision of the Federal Circuit on the
exact same question. App., infra, 19a (“our holding
today departs from the Federal Circuit[]”); BASR
P’ship v. United States, 795 F.3d 1338 (Fed. Cir. 2015).
That division leaves the meaning of § 6501(c)(1)
dependent on the forum in which a taxpayer litigates
and disrupts the uniform nationwide application of the
federal tax code. Worse yet, high-income taxpayers
can litigate in the U.S. Court of Federal Claims (where
they will win under Federal Circuit authority), while
any litigant stuck in United States Tax Court could
now lose under the Third Circuit’s opposite position.1
That open division is intolerable in a scheme that
demands uniformity.
This question is also one of critical importance.
Expert commentators have flagged the Third Circuit’s
decision as one of the year’s “most significant federal
1
This disparity is a result of the specific rules for filing a
refund claim in the Court of Claims: the taxpayer must first pay
the full disputed tax before filing suit. See 28 U.S.C. § 1346(a)(1);
28 U.S.C. § 1491(a). That option is often not available as a
practical matter to lower-income taxpayers.
4
tax decisions” (A. Farrell, Top Federal Tax Decisions
of
2025,
Law360
(Dec.
23,
2025)
<https://www.law360.com/taxauthority/articles/2421046?>), and major stakeholders
participated as amicus curiae at the circuit level,
reflecting the issue’s importance.
Moreover, this case presents an excellent
vehicle to resolve this issue. The single statutory
question is a pure question of law, was outcomedeterminative below, and arrives here in a clean
vehicle. This case presents the ideal opportunity for
this Court to resolve whether innocent taxpayers can
face IRS demands years (or even many decades) after
the fact—or whether § 6501(c)(1)’s fraud exception
applies only when the taxpayer herself acted with
intent to evade tax.
Because the courts of appeals are divided over
whether § 6501(c)(1)’s unlimited limitations period
applies only when the taxpayer herself acted with
fraudulent intent, or instead whenever a third party
associated with the return acted with such intent, and
because this case presents an ideal vehicle for
resolving that important and dispositive question of
federal law, this Court’s review is warranted.
STATEMENT
I.
Legal Background
The Code authorizes the Secretary of the
Treasury, or his delegate, the Commissioner of
Internal Revenue, to examine any tax return filed by
a taxpayer. 26 U.S.C. § 6201(a); see also 26 U.S.C. §
7701(a)(11).
If, during that examination, the
5
Commissioner determines that additional tax may be
due, the Commissioner is authorized to “assess” tax,
interest, and certain penalties—an administrative act
that formally records the taxpayer’s liability and
permits the government to pursue enforced collection
through the statutory collection procedures provided
by the Code. See 26 U.S.C. § 6201(a). Congress
limited that assessment authority by establishing
periods of limitation on assessment as set forth in §
6501.
Section 6501(a) provides the general rule that
the Commissioner must assess tax within three years
after a taxpayer files a return. 26 U.S.C. § 6501(a).
Section 6501(c) sets forth various exceptions to this
general rule. As relevant here, § 6501(c)(1) establishes
one such exception, providing: “[i]n the case of a false
or fraudulent return with the intent to evade tax, the
tax may be assessed, or a proceeding in court for
collection of such tax may be begun without
assessment, at any time.”2
While the statute does not expressly state
whose intent is required to suspend the three-year
limitations period, for nearly a century, the answer
was clear: only the taxpayer’s fraudulent intent.
Accordingly, courts historically interpreted the
This fraud-based exception is not new to the Code.
Congress first enacted the same limitations-period exception in
the Revenue Act of 1918, and it did so alongside the Act’s fraudbased penalty provision. See Revenue Act of 1918, Pub. L. No.
65-254, § 250(b), (d), 40 Stat. 1057, 1083. As discussed below,
both fraud-based provisions were limited to the taxpayer’s own
conduct. Congress has since restructured the Act, but there is no
indication that it departed from the Act’s original meaning.
2
6
provision to require fraudulent intent by the taxpayer
whose liability is at issue. See, e.g., Payne v. Comm’r,
224 F.3d 415, 421 (5th Cir. 2000) (requiring proof of
“fraudulent intent on the part of the taxpayer”). Even
the IRS adopted that position for decades, reflecting
the uniform understanding of parallel language in
corresponding provisions of the Code. IRS Field
Service Advice 200104006, 2001 WL 632261 (Sept. 15,
2000). That settled construction began to change in
2001. In IRS Field Service Advice 200126019, 2001
WL 729653 (June 29, 2001), the IRS reversed course
and concluded for the first time that § 6501(c)(1)
applies based on a return preparer’s fraudulent intent
even absent fraud by the taxpayer. Although the
statutory text had not changed, just the government’s
take on it, the Tax Court subsequently adopted that
position in Allen v. Comm’r, 128 T.C. 37, 42 (2007),
holding that the limitations period is set aside
whenever a return is fraudulent, regardless of who
committed the fraud (and even if the taxpayer is
innocent).
In 2015, the Federal Circuit rejected the Tax
Court’s contrary interpretation view and reaffirmed
that § 6501(c)(1) applies only when “the taxpayer—
and not a third party—acts with the requisite intent
to evade tax.” BASR P’ship v. United States, 795 F.3d
1338, 1339 (Fed. Cir. 2015). The government has
continued to press the broader interpretation adopted
in Allen in Tax Court proceedings nationwide,
7
ensuring that the split has concrete and recurring
consequences.3
II.
Factual and Procedural Background
A. This case arose from the government’s
attempt to assess additional taxes and penalties on a
series of Murrin’s returns filed over two decades ago
(1993-1999). App., infra, 3a.
On the key stipulated facts, Murrin’s tax
preparer “placed false or fraudulent entries on
Murrin’s tax returns with an intent to evade tax”
(App., infra, 2a–3a), but Murrin herself neither knew
of the fraud nor intended to evade tax (id).4 To the
contrary, Murrin acted in good faith and did not know
about, let alone cause any false entries on any of the
returns. Id. About purported underpayments on
those stale returns. I
Murrin contested the IRS’s
3 The Tax Court is a court of nationwide jurisdiction that hears
deficiency cases from taxpayers across all circuits. See 26 U.S.C.
§§ 6213(a), 7442.
4 App., infra, 2a, 43a. Howell had previously been criminally
prosecuted and convicted in 1986 for preparing fraudulent tax
returns for other taxpayers, and his certified public accountant
license was suspended during the period in which he prepared
the Murrins’ returns for 1993 through 1999. App., infra, 39a.
The Murrins were unaware of Howell’s past misconduct. In 2007,
Howell’s fraudulent conduct only became known when he pleaded
guilty to federal charges of conspiring to defraud the United
States, aiding and assisting in the preparation of false tax
returns, and corruptly endeavoring to obstruct the
administration of the internal revenue laws. App., infra, 39a
(citing Finnegan v. Comm’r, T.C. Memo. 2016-118, at *5–10
(explaining Howell’s criminal indictment and conviction for a
scheme to defraud the United States through the preparation of
false and fraudulent tax returns)).
8
action in Tax Court, conceding the unpaid taxes but
contesting the timeliness of the IRS’s action. Is/
(invoking § 6501(a)’s three-year limitations period).
Despite all sides agreeing that Murrin herself did
nothing wrong, the Tax Court held that § 6501(c)(1)
excused the IRS’s delay because Murrin’s tax preparer
(unbeknownst to her) intentionally “prepared
* * * false or fraudulent tax returns with an intent to
evade tax.” Id.; see also id. at 3a, 61a.
The
notice
of
deficiency
determined
approximately $65,318 in additional tax and
approximately $13,064 in accuracy-related penalties.
App., infra, 3a, 20a. By the time the notice was issued,
accrued interest alone exceeded $250,000. App., infra,
20a. In total, Murrin now faces more than $328,000 in
tax, penalties, and interest arising from returns filed
between 1993 and 1999.
B. 1. The Third Circuit affirmed. App., infra,
1a–21a. The court initially confirmed the appeal
“turns on” a single legal question: “our interpretation
of § 6501.” Id. at 3a. Critically, in resolving that
question, the Third Circuit “respectfully part[ed]
ways” with the Federal Circuit’s competing decision in
BASR P’ship v. United States, 795 F.3d 1338 (Fed. Cir.
2015). App., infra, 19a–20a; see also BASR, 795 F.3d
at 1350 (holding the IRS is bound by “the three-year
limitations period unless the taxpayer possessed the
intent to evade tax”) (emphasis added). The Third
Circuit explicitly rejected the Federal Circuit
majority’s rationale, “depart[ed]” from its holding, and
sided instead with BASR’s dissent. App., infra, 19a–
20a (endorsing Chief Judge Prost’s minority position).
9
The panel further explained that, although it
recognized Murrin’s reading of the statute “is a fair
one,” and although it “underst[oo]d” her “frustration
with the IRS’s decision to assess tax beyond the
statute of limitations due to the wrongdoing of
someone other than her,” it nevertheless considered
itself “bound” by its reading of § 6501(c)(1), which it
viewed as “agnostic about who must intend to evade
tax.” App., infra, 2a, 21a. It therefore held that §
6501(c)(1) does not require taxpayer intent to
eliminate the three-year statute of limitations, and
that the Code’s “indefinite limitations period” can be
triggered by a third party’s misconduct alone. Id. at
4a.
The panel reached that conclusion through a
three-step analysis of the statutory text and context.
First, it held that nothing about “false or fraudulent
return” or “intent to evade tax” “facially includes any
indication that the taxpayer must be the actor who
intends to evade tax.” App., infra, 6a. Although it
conceded that the term “tax” “does bear a connection
to taxpayers,” the court then contended that nothing
about the terms “intent” or “to evade” were “restricted
to certain individuals.” Id. Second, it concluded that
what it termed Congress’s use of the passive voice
indicated that Congress did not care who had the
requisite intent, so long as someone did. Id. at 7a
(citing Bartenwerfer v. Buckley, 598 U.S. 69 (2023)).
Third, although it recognized that Murrin’s reading
was a fair one, it reasoned that Congress knew how to
limit provisions to taxpayers but had not done so here.
Id. at 8a, 10a-12a.
10
In so doing, it dismissed the argument that its
reading focused only on the “false or fraudulent
return” and thus rendered “intent to evade tax”
superfluous. App., infra, 9a. And in concluding that
the statutory context supported its reading, it also
dismissed the fact that Congress paired the fraud
penalty (now § 6663) and the unlimited assessment
provision (now § 6501(c)(1)) in the Revenue Act of
1918, using the same “intent to evade tax” language in
both—thus confirming that the taxpayer’s intent was
the touchstone. Id. at 12a. The panel’s decision
untethered § 6501(c)(1) from that statutory design and
concluded that the “‘intent to evade tax’ must attach
to the ‘false or fraudulent return.’” Accordingly, the
court held that § 6501(c)(1) does not require taxpayer
intent and permits assessment beyond the three-year
limitations period based solely on a third party’s
misconduct. Id. at 4a.
2. The Third Circuit subsequently denied a
petition for rehearing en banc but granted a petition
for panel rehearing. App., infra, 62a–63a. In an
amended opinion, the Third Circuit confirmed that its
decision did not preclude Murrin from challenging
penalties or interest “in a future proceeding.” Id. at
20a n.13. It otherwise left its holding unchanged.
REASONS FOR GRANTING THE PETITION
This case presents a direct, acknowledged
conflict over the scope of an essential provision of the
Code. The answer has broad consequences for the
nation’s tax laws and for the fair and efficient
administration of Congress’s tax scheme.
It
ultimately dictates whether finality and repose exist
11
for innocent taxpayers—or whether the government
can pursue innocent parties “indefinitely” for a third
party’s unilateral fraud. The Third Circuit below
created a square split with the Federal Circuit. While
it acknowledged that split, it overlooked its
consequences: under the decision below, taxpayers
who can afford to prepay alleged deficiencies can
automatically usher disputes to the court of claims—
where the Federal Circuit’s contrary rule controls—
while all other taxpayers remain subject to the
government’s (tardy) enforcement whims. The IRS
should not be subject to a three-year limitations period
(or no deadline at all) based entirely on the location of
a taxpayer’s challenge. That profound arbitrariness is
intolerable in a system that demands uniformity.
This Court’s intervention is warranted to
resolve the acknowledged circuit split and restore a
uniform interpretation of 26 U.S.C. § 6501(c)(1).
I.
The Decision Below Creates a Direct and
Acknowledged Circuit Split Over the
Scope of 26 U.S.C. § 6501(c)(1).
The Third Circuit held that 26 U.S.C. §
6501(c)(1) permits the IRS to assess tax “at any time”
whenever a tax return is false or fraudulent and
someone acted with intent to evade tax—even if the
taxpayer herself is entirely blameless, had no clue
about the misconduct, and never intended to underpay
her tax. App., infra, 2a–3a, 23a–24a. In so holding,
the Third Circuit expressly rejected the 2-1 Federal
Circuit’s contrary interpretation of the same statutory
text on indistinguishable facts. App., infra,46a–47a
(rejecting the holding in BASR P’ship v. United States,
12
795 F.3d 1338 (Fed. Cir. 2015); adopting instead thenChief Judge Prost’s “dissent[]”).
Each court
exhaustively analyzed § 6501’s text, structure, history,
context, and purpose. Each considered the competing
policy implications of permitting the government to
saddle taxpayers with crushing tax liability decades
after the fact—with zero warning to innocent citizens
and families.
Yet the Third Circuit held the
government got the benefit of an “indefinite”
limitations period, while the Federal Circuit, viewing
the provision’s language together with the identical
construction assigned parallel provisions across the
Code, held the government to § 6501(a)’s three-year
deadline.
The stark division on an issue of national
importance is untenable; the Code should not impose
different deadlines and protections for identically
situated taxpayers.
The conflict is clear and
undeniable, and it should be resolved by this Court.
A. As the Third Circuit candidly acknowledged,
the decision below directly contravenes settled law in
the Federal Circuit. Like the Third Circuit, the
Federal Circuit considered the statutory language, the
structure, and scheme in considerable detail—but the
majority arrived at precisely the opposite conclusion.
First, the Federal Circuit looked to the
statutory language. In so doing, it “recognize[d] that
Section 6501(c)(1) is silent as to which party or parties
must have the requisite fraudulent intent to suspend
the three-year statute of limitations for pursuing a
past underpayment,” but held that “silence alone does
not automatically compel the conclusion that Congress
13
intended that actions by parties other than the
taxpayer could suspend the three year statute of
limitations. BASR P’ship, 795 F.3d at 1343. To the
contrary, it concluded, the reference to a return had to
be understood in context. Id. Moreover, it held that
courts cannot determine the meaning of the statutory
language without examining that language in light of
its place in the statutory scheme. BASR P’ship, 795
F.3d at 1343. And, as relevant to this question, it
noted, other provisions in the Code relating to
fraudulent conduct strongly suggest that the Code
confines the “intent to evade tax” inquiry to the
taxpayer’s intent. Specifically, it noted that “the
precursor statute to § 6501(c)(1), in particular,
confirms this understanding,” and that “[t]hese
sources lead us to conclude that the reading of §
6501(c)(1) most ‘coherent and consistent’ with the
statutory scheme is one that limits the application of
this provision to cases involving a false or fraudulent
return where the taxpayer acted with the intent to
evade tax.” Id.
Second, the Federal Circuit engaged in a
painstaking survey of other fraud-related provisions of
the Code, concluding “that they contemplate fraud by
the taxpayer, as opposed to by a person who merely
contributed, albeit in a fraudulent way, to the filing of
an inaccurate tax return.” BASR P’ship, 795 F.3d at
1344.
And the Federal Circuit noted that the
Government’s broad interpretation of § 6501(c)(1), if
applied to other code provisions, could have
unintended and unfortunate consequences. Id, at
1346. For example, the court noted, it could prevent
taxpayers from receiving an extension for payment of
a tax deficiency under I.R.C. § 6161(b)(3), which
14
prohibits the IRS from granting an extension when the
tax deficiency in question is “due to negligence, to
intentional disregard of rules and regulations, or to
fraud with intent to evade tax.” Id. Like the other
statutory provisions discussed above, § 6161 does not
expressly specify whether a third-party’s negligent or
fraudulent conduct would prevent the taxpayer from
receiving an extension. Id. Accordingly, the court
noted, if the government prevailed in its view that §
6501(c)(1) permits the IRS to look beyond the taxpayer
for the requisite intent, the same would surely apply
under § 6161. Id.
Third, the court noted that the IRS had
obviously changed its position on the interpretation of
§ 6501(c)(1),” but that it was “unclear what prompted
this change in the IRS’s position, given that Congress
had not altered the text of § 6501(c)(1) in any
meaningful way over the past century” and that the
statutory history did not support the IRS’s position.
Id. at 1348. The panel then addressed § 6501(c)’s
origins, explaining that the concept of limiting the
time period during which the IRS could assess tax
originated almost 100 years ago in the same statutory
provision that authorized the IRS to impose penalties
for underpayment. BASR P’ship, 795 F.3d at 1339
(citing Revenue Act of 1918, Pub. L. No. 65–254, 40
Stat. 1057). “[R]eviewing the evolution of § 6501 from
its origin as § 250(d) of the Revenue Act of 1918 is
instructive
on
understanding
the
proper
interpretation.
The context provided by this
predecessor statute confirms that Congress intended
that only the taxpayer’s intent to evade tax could
trigger the unlimited limitations period that now
appears in § 6501(c)(1).” Id.
15
Specifically, as it explained, the fraud penalty
and the fraud suspension of the statute of limitations
appeared together in § 250 of the Revenue Act of 1918.
Id. Section 250(b) imposed certain penalties for
underpayment when the underpayment resulted from
the taxpayer’s negligence or intent to evade tax: as it
provided, “if the return is made in good faith and the
understatement of the amount in the return is not due
to any fault of the taxpayer, there shall be no penalty
because of such understatement.
If the
understatement is due to negligence on the part of the
taxpayer, but without intent to defraud, there shall be
added as part of the tax 5 per centum of the total
amount of the deficiency.... If the understatement is
false or fraudulent with intent to evade the tax, then ...
there shall be added as part of the tax 50 per centum
of the amount of the deficiency.”
Id. As the
government agreed in BASR, the fraud penalty
provision in § 250(b) “focuses solely on the taxpayer’s
own intent.” Id.
That fact, the majority concluded, necessarily
informs the reading of § 250(d), which appears two
subsections later, borrows the “false or fraudulent
with intent to evade tax” language from § 250(b), and
uses it to describe situations when the normal period
for assessing tax may be extended indefinitely.
Although “Section 250(d) does not expressly identify
whose ‘intent to evade the tax’ could be used to extend
the limitations period, the mirroring language in §
250(b), which is directed to the taxpayer’s intent,
informs the interpretation of § 250(d).” With this in
mind, the court held, “it becomes abundantly clear
that the focal point of § 250 is the intent of the
taxpayer.
The taxpayer’s intent is central to
16
determining whether to impose a penalty and whether
the IRS may avail itself of an unlimited period to
assess tax.” Id. at 1349. And while those sections had
subsequently been recodified and reorganized,
“nothing in the recodification and reorganization
process altered the meaning of the terms ‘intent’ and
‘fraudulent’ as used in this predecessor statute.” Id.
Accordingly, it concluded, “[t]he language, structure,
and history of the Code leads … to the conclusion that
the Claims Court properly interpreted § 6501(c)(1) as
limiting the IRS to the three-year limitations period
unless the taxpayer possessed the intent to evade tax.”
Id. at 1350; but see 795 F.3d at 1357-1361 (Prost, C.J.,
dissenting).
B. In sum: In BASR, the Federal Circuit rejected
the government’s contention that § 6501(c)(1) turns
solely on the existence of a “fraudulent return,”
regardless of who committed the fraud. 795 F.3d at
1339–46. Instead, the Federal Circuit held “§ 6501(c)’s
suspension of the three-year limitation applies only
when the taxpayer—and not a third party—acts with
the requisite ‘intent to evade tax.’” 795 F.3d at 1339.
The Third Circuit reached the opposite conclusion:
“the ‘intent to evade tax’ exception in § 6501(c)(1)” does
not require “the taxpayer” to “be the actor who intends
to evade tax.” App., infra, 5a–6a. Each court
examined the same arguments and the same universe
of material, canvassing the same text, context,
structure, history, agency guidance, policy, and
purpose. And yet each adopted opposite conclusions.
The debate has been fully exhausted, and there is no
reasonable prospect that the conflict will resolve itself
17
without this Court’s
warranted now.
II.
intervention.
Review
is
The Question Presented Is Exceptionally
Important.
A. The question presented is exceptionally
important. This issue determines whether the statute
of limitations affords taxpayers any meaningful repose
from stale and substantial tax liabilities based on
another person’s misconduct—even when that
misconduct took place decades earlier and the
taxpayer was entirely unaware of it.
When
assessment is permitted without any temporal limit,
the result is devastating for taxpayers who, due to the
passage of time, not any fault of their own, cannot
prove the accuracy of their tax returns or the fraud (or
lack thereof) by their return preparer.
Those
taxpayers are left to defend their tax returns when the
government suddenly appears unannounced, out of
nowhere, asserting massive tax liabilities from
decades earlier. And the insult added to that injury is
an innocent party’s financial life can be turned upsidedown based on someone else’s fraud—conducted in the
far-off past and entirely unbeknownst to the lawabiding party.5
The Third Circuit suggested its rationale was supported by
Bartenwerfer, and it noted in passing that Bartenwerfer pre-dated
the Federal Circuit’s competing decision. Yet Bartenwerfer
cannot save the obvious circuit conflict. That case arose in a
different context (a dischargeability question under the
Bankruptcy Code); the “passive-voice” concept arose long before
Bartenwerfer (which is why that decision itself -- in the very
passages the Third Circuit cites -- invoke pre-Federal Circuit
decisions); and Bartenwerfer itself emphasized that “‘context’”
5
18
It is well established that Congress created a
fraud exception because fraudulent conduct may be
more difficult to detect within the general three-year
statute of limitations on tax assessments. Courts have
long recognized that principle. But Congress did not
adopt an unlimited fraud-based regime untethered
from taxpayer conduct. It conditioned the elimination
of repose on the presence of “intent to evade tax.” The
question here is not whether fraud warrants
additional time; it is whether Congress authorized
eliminating the limitations period when the taxpayer
herself committed no fraud at all. The disparity is
stark: the statute may reasonably allow additional
time to pursue a taxpayer who engaged in fraud, but
it cannot fairly be read to eliminate all temporal limits
on assessment against a taxpayer who did not. See,
e.g., United States v. Updike, 281 U.S. 489, 495 (1930)
(open-ended enforcement periods “out of harmony
with the obvious policy of the act to promote repose by
fixing a definite period after assessment within which
suits and proceedings for the collection of taxes must
be brought”).
The Third Circuit’s and the government’s
interpretation undermines the central function of a
limitations period: at some point, parties are entitled
to repose to structure their finances and affairs, and
ensure their futures are not subject to indefinite
assessment. As noted above, with the passage of
decades, evidentiary burdens increase, records are
lost, and memories fade, particularly where the
dictates the result (App., infra, 7a n.6) -- the Court did not
announce a new rule, let alone a global rule that somehow
overrides the Federal Circuit’s careful examination of a
fundamental question of federal tax law.
19
taxpayer is not defending her own conduct but
attempting to disprove a third party’s conduct—and
harder yet, intent.
There is a reason that Congress limited every
other associated Code provision involving fraud to
misconduct committed by the taxpayers themselves.
BASR P’ship, 795 F.3d at 1344. There is likewise a
reason that Congress embraced this rule (with these
important limitations) when it restructured the
Code—borrowing the settled understanding from the
1918 Act. And there is a reason that the IRS itself
adhered to this commonsense construction for nearly
a century—before changing its interpretation without
any relevant change in the statutory text. The result
is a direct and acknowledged conflict over the meaning
of a core limitations provision.
This issue is highly significant for innocent
taxpayers caught up in a third party’s fraud. No one
suggests taxpayers who submit a false or
fraudulent return with the intent to evade tax should
avoid consequences—and those taxpayers at least are
on notice of the possibility that the government may
seek to collect unpaid taxes. But an innocent taxpayer
has no notice of concealed misconduct. Whether
Congress intended § 6501(c)(1) to eliminate repose in
such circumstances is a question of substantial and
recurring importance warranting this Court’s review.
B. Review is also essential in light of the
overriding importance of uniformity in the nation’s tax
laws. See, e.g., Hinck v. United States, 550 U.S. 501,
506–08 (2007) (resolving a conflict between the
Federal Circuit and a regional circuit concerning the
20
proper forum for review under 26 U.S.C. § 6404(h)). It
makes little sense to say taxpayers in different regions
should face different limitations rules based on
geography alone. Yet as it now stands, taxpayers in
the Third Circuit can face assessment without
temporal limitation, while taxpayers in the Federal
Circuit have a complete defense to stale IRS efforts—
cabined at three years. This issue sharply split a panel
of the Federal Circuit, and it has now squarely divided
the courts of appeals—with the Third Circuit openly
“departing” from the Federal Circuit’s position. App.,
infra, 19a. Absent review, the conflict will persist as
additional courts confront the same question. The
issue has been fully ventilated by two courts of appeals
that examined the same statutory text, structure, and
history yet reached opposite conclusions. Further
percolation is unlikely to eliminate the division or add
meaningfully to the debate, given the detailed
analyses of both appellate courts.
This conflict is particularly pernicious in this
setting. Given the way taxpayers can challenge IRS
assessments, parties now have the option of litigating
in the Federal Circuit or elsewhere—so long as they
can afford to prepay any alleged tax deficiency in
advance.6 As a practical matter, taxpayers with
6
In a nutshell: Taxpayers who wish to challenge a
deficiency without prepaying the asserted tax must proceed in the
Tax Court. See 26 U.S.C. §§ 6213(a), 7442. Taxpayers who
prepay the asserted liability may bring a refund suit in the Court
of Federal Claims or the appropriate U.S. district court. See 28
U.S.C. § 1346(a)(1); Flora v. United States, 362 U.S. 145, 156
(1960). Appeals from the Court of Federal Claims lie exclusively
in the Federal Circuit. See 28 U.S.C. § 1295(a)(3). Appeals from
the Tax Court in deficiency proceedings generally lie in the court
21
sufficient means can defeat stale IRS enforcement
efforts (since the Federal Circuit’s precedent will
control); taxpayers who lack sufficient means will be
stuck litigating in regional circuits—where the IRS’s
staggering interpretation may prevail.
No one benefits from a tax system that produces
opposite outcomes based on the forum in which a case
is litigated. The Code should not turn on geography
alone, and it should not depend on a taxpayer’s ability
to prepay an assessment. Review is essential to
ensure the fair and uniform administration of the
nation’s tax laws.
III.
This Case Is an Ideal Vehicle for
Resolving the Question Presented.
This case is the ideal vehicle for deciding this
important question. The dispute turns on a pure
question of law: namely, the proper scope of 26 U.S.C.
§ 6501(c)(1). App., infra, 3a (the appeal “turns on” a
single legal question—“our interpretation of § 6501”).
That question was squarely raised and resolved at
each stage below. There are no factual or procedural
impediments, and the “material facts” are
“undisputed.” Id. at 2a. The court below exhaustively
examined the issue and rejected a 2-1 decision of the
Federal Circuit—expressly repudiating the Federal
Circuit’s majority and siding instead with the dissent.
Id. at 9a, 19a-20a (“we respectfully part ways”). The
of appeals for the circuit in which the taxpayer resides or has its
principal place of business. See 26 U.S.C. § 7482(b). The end
result: anyone with the means to prepay the asserted liability can
purchase a three-year limitations period; anyone who lacks those
funds is stuck at the mercy of a regional circuit court.
22
sole statutory question is binary: if a third party’s
fraud is sufficient, the government wins; if the
taxpayer’s fraud is required, the government loses.
The ability of the government to target innocent
taxpayers decades after someone else’s wrongdoing
(with an “indefinite limitations period”) hangs in the
balance. Id. at 4a.
The question, in short, is cleanly presented, and
there are no obstacles to resolving it here. In the
meantime, a fundamental component of the nation’s
tax laws will turn entirely on geography—or the fiscal
ability of a taxpayer to litigate in a particular forum.
That division warrants this Court’s review.
IV.
The Decision Below Converts a Narrow
Fraud Exception into a Regime of
Perpetual Liability for Innocent
Taxpayers.
The Third Circuit’s interpretation of 26 U.S.C.
§ 6501(c)(1) is also wrong. It fundamentally alters the
balance Congress struck between repose and
enforcement in the federal tax system. By holding
that the statute permits assessment “at any time”
based solely on the undisclosed fraudulent intent of a
third party involved in preparing or filing a return, the
decision below transforms a narrow fraud exception
into a mechanism for effectively indefinite liability
against taxpayers who acted in good faith, complied
with their reporting obligations, and neither intended
nor knew of any wrongdoing.
That transformation is not compelled by the
statutory text, structure, or history. The decision
below severs the intent requirement from the
23
taxpayer’s own conduct, thereby expanding the fraud
exception beyond its textual and historical bounds.
1. As a general rule, “the amount of any tax
imposed by this title shall be assessed within 3 years
after the return was filed.” 26 U.S.C. § 6501(a).
Congress departed from that baseline only in carefully
delineated circumstances.
Put differently, the
statutory text links the forfeiture of the three-year
limitations period to the presence of “intent to evade
tax.” That phrase is not surplusage. It is the statutory
condition that distinguishes ordinary errors or
misstatements from conduct that justifies withdrawal
of repose. If Congress had intended § 6501(c)(1) to
apply whenever a return is false or fraudulent,
without regard to whose intent was involved, it could
have said so by authorizing assessment “in the case of
a false or fraudulent return.” It did not. Congress
instead required fraud “with the intent to evade tax,”
making intent a necessary element of the exception
rather than a descriptive aside.
Moreover, the grammatical structure of §
6501(c)(1) reinforces the conclusion that the statute
withdraws repose only when the taxpayer herself
acted with intent to evade tax. The provision uses the
transitive verb “evade” with “tax” as its object,
repeatedly referring to “the tax” and “such tax.” 26
U.S.C. § 6501(c)(1). Those terms most naturally refer
to the taxpayer’s own tax liability—the only tax that
may be assessed under § 6501. Nothing in the
statutory text suggests that Congress conditioned the
forfeiture of the taxpayer’s statutory repose on the
intent of a third party to evade a tax that the third
party does not owe and that he or she is not legally
24
obligated to report or pay. Indeed, it would be
anomalous to condition the withdrawal of the
taxpayer’s statutory repose on a third party’s intent to
evade a tax that only the taxpayer owes and that only
the taxpayer is legally obligated to report and pay.
That linkage is confirmed by § 6501(a), which
defines the relevant “return” for limitations purposes
as “the return required to be filed by the taxpayer.” 26
U.S.C. § 6501(a). This Court has instructed that
statutory terms carry consistent meaning throughout
§ 6501. Badaracco v. Comm’r, 464 U.S. 386, 397
(1984). Read together, §§ 6501(a) and 6501(c)(1)
establish that the fraud exception concerns a return
required to be filed by the taxpayer and withdraws
repose only when that return is false or fraudulent
with intent to evade tax—i.e., when the taxpayer acted
with such intent.
The court of appeals reached its contrary
interpretation by focusing on § 6501(c)(1)’s
grammatical structure rather than on the relationship
between intent and liability embedded in the
limitations framework as a whole, notwithstanding
this Court’s instruction that “context counts” and that
passive-voice formulations do not, standing alone,
answer questions about whose conduct triggers legal
consequences. Bartenwerfer v. Buckley, 598 U.S. 69,
78 (2023).
2. The structure of the statutory scheme
provides the necessary context. Section 6501(c)(1)
does not operate in isolation. It is part of a carefully
calibrated statutory scheme in which Congress
differentiated among multiple limitations rules
25
depending on the nature of the taxpayer’s conduct.
Congress demonstrated within § 6501 itself that it
knows how to extend the assessment period without
regard to intent when it wishes to do so. Most notably,
§ 6501(e)(1) extends the limitations period from three
years to six years when a taxpayer omits more than 25
percent of gross income from a return—without any
requirement of fraudulent intent.
26 U.S.C. §
6501(e)(1).
That provision reflects Congress’s
judgment that certain objectively measurable
reporting failures justify additional time for
assessment even absent culpability.
By contrast, § 6501(c)(1) does not turn on the
magnitude of an omission or the complexity of
detection. It requires, and indeed turns on, intent.
Congress retained that intent requirement even as it
authorized intent-neutral extensions elsewhere in the
same statutory section. That choice would have no
apparent justification in the statute’s text or structure
if § 6501(c)(1) already applied whenever a return is
fraudulent due to anyone’s intent, including third
parties beyond the taxpayer’s knowledge or control.
The court of appeals’ reading also creates an
asymmetry between § 6501(c)(1) and other fraudrelated provisions of the Code. For example, the civil
fraud penalty in § 6663(a) applies only when an
underpayment is “due to fraud,” a phrase courts have
uniformly interpreted to require fraud by the
taxpayer. See Stoltzfus v. United States, 398 F.2d
1002, 1004 (3d Cir. 1968); see also Raley v. Comm’r,
676 F.2d 980, 983 (3d Cir. 1982). Likewise, § 7454(a)
places the burden of proof on the Commissioner “[i]n
any proceeding involving the issue whether the
26
petitioner has been guilty of fraud with intent to evade
tax,” again focusing on taxpayer conduct. This Court’s
review is warranted to address that asymmetry.
CONCLUSION
The petition for a writ of certiorari should be
granted.
Respectfully submitted.
Daniel L. Geyser
HAYNES AND BOONE, LLP
2801 N. Harwood Street,
Ste. 2300
Dallas, TX 75201
/s/ Anne M. Voigts
Anne M. Voigts
Counsel of Record
PILLSBURY WINTHROP SHAW PITTMAN
LLP
2400 Hanover Street
Palo Alto, CA 94304
(650) 233-4075
anne.voigts@pillsburylaw.com
Lawrence A. Sannicandro
Darianne De Leon
PILLSBURY WINTHROP SHAW PITTMAN
LLP
31 W. 52nd St
New York, NY 10019
Counsel for Petitioner Stephanie
Murrin
FEBRUARY 2026
27
APPENDIX
APPENDIX TABLE OF CONTENTS
Page
APPENDIX A: OPINION, U.S. Court of
Appeals for the Third Circuit (October 17,
2025) .................................................................
1a
APPENDIX B: OPINION, U.S. District Court
for the Third Circuit (August 18, 2025) ..........
22a
APPENDIX C: MEMORANDUM OPINION,
U.S. Tax Court (January 21, 2024) .................
42a
APPENDIX D: GRANTING OF REHEARING /
DENIAL OF REHEARING EN BANC, U.S.
Court of Appeals for the Third Circuit
(October 17, 2025) ............................................
62a
APPENDIX E: STATUTORY PROVISIONS.....
64a
1a
Appendix
A
APPENDIX A — OPINION
OF THE
UNITED STATES
COURT OF APPEALS FOR THE THIRD CIRCUIT,
FILED OCTOBER 17, 2025
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 24-2037
STEPHANIE MURRIN,
Appellant,
v.
COMMISSIONER OF INTERNAL REVENUE
On Appeal from the United States Tax Court
U.S. Tax Court No. 19-14614
Tax Court Judge: Patrick J. Urda
Argued April 30, 2025
Before: KRAUSE, BIBAS, and
MONTGOMERY-REEVES,
Circuit Judges.
(Filed October 17, 2025)
OPINION OF THE COURT
MONTGOMERY-REEVES, Circuit Judge.
Typically, the Internal Revenue Service (“IRS”) must
assess tax within three years from the date an individual
2a
Appendix A
taxpayer files her return. I.R.C. § 6501(a).1 An exception
to this statute of limitations exists, however. When there
is “a false or fraudulent return with the intent to evade
tax,” the IRS can assess tax “at any time.” Id. § 6501(c)(1).
But whose “intent” is required for this exception to the
statute of limitations to apply? That is the subject of this
appeal. Appellant Stephanie Murrin argues that only the
taxpayer’s intent matters. That is, the exception applies
only if the taxpayer herself intends to evade tax. And
because Murrin’s tax preparer prepared her taxes with
an intent to evade tax while she did not, the exception to
the statute of limitations does not apply. We understand
Murrin’s frustration with the IRS’s decision to assess tax
beyond the statute of limitations due to the wrongdoing of
someone other than her. But we are bound by the statute.
And because the statute is agnostic about who must intend
to evade tax, we hold that taxpayer intent is not required.
Thus, we will affirm the judgment of the Tax Court.
I.
BACKGROUND
The material facts in this appeal are undisputed.
Murrin underpaid her taxes from 1993 to 1999 because
her tax preparer, Duane Howell, placed false or fraudulent
entries on Murrin’s tax returns with an intent to evade tax.
But Murrin did not cause the false or fraudulent entries,
and she did not intend to evade tax.
Over 20 years later, in 2019, the IRS issued a notice
of deficiency to Murrin regarding underpayments on her
1. The “Code” refers to the Internal Revenue Code. See 26
U.S.C. § 1 et seq.
3a
Appendix A
tax returns between 1993 and 1999. Id. § 6212(a). Murrin
filed a petition in the Tax Court for a redetermination
of the deficiency. Id. § 6213(a). Murrin agreed with the
IRS that she underpaid $65,318 in tax, and she did not
dispute the application of an accuracy-related penalty of
$13,064 for the underpayment. Instead, Murrin argued
that the IRS did not act within the three-year statute of
limitations. The Tax Court held that § 6501(c)(1) applies
because Howell prepared Murrin’s false or fraudulent tax
returns with an intent to evade tax, and thus the statute
of limitations under § 6501(a) did not bar the IRS’s notice
of deficiency. Murrin appealed.
II. JURISDICTION AND STANDARD OF REVIEW
The Tax Court had jurisdiction under I.R.C. §§ 6213(a)
and 7442. We have jurisdiction under I.R.C. § 7482
(a)(1). We exercise de novo review over the Tax Court’s
interpretation of the Code. Sunoco Inc. v. Comm’r, 663
F.3d 181, 185 (3d Cir. 2011).
III. DISCUSSION
This appeal turns on our interpretation of § 6501.
Section 6501(a) states that “any tax imposed by [the Code]
shall be assessed within 3 years after the return was
filed”—that is, three years from the filing of “the return
required to be filed by the taxpayer.” Subsection (c) then
includes twelve exceptions to the three-year statute of
limitations, one of which is relevant here. Section 6501(c)(1)
provides, in full, that “[i]n the case of a false or fraudulent
return with the intent to evade tax, the tax may be
assessed, or a proceeding in court for collection of such
4a
Appendix A
tax may be begun without assessment, at any time.” 2 To
determine whether taxpayer intent is necessary to trigger
the indefinite limitations period in § 6501(c)(1), we examine
(1) the text of § 6501(c)(1), (2) the statutory context of
§ 6501(c)(1), and (3) relevant precedent. All three reveal
that § 6501(c)(1) is not limited to a taxpayer’s intent. We
address each in turn.
A.
Section 6501(c)(1)’s Plain Text Applies to More
Than Taxpayers
“Our analysis begins with the statutory text.”
Mississippi ex rel. Hood v. AU Optronics Corp., 571 U.S.
161, 168, 134 S. Ct. 736, 187 L. Ed. 2d 654 (2014) (citing
Sebelius v. Cloer, 569 U.S. 369, 376, 133 S. Ct. 1886, 185 L.
Ed. 2d 1003 (2013)). “We give the words of a statute their
‘ordinary, contemporary, common meaning,’ absent an
2. Section 6501(c)(1) keys the statute of limitations to
“assessment.” A tax assessment is simply “what the taxpayer is
required to pay the Government.” Soni v. Comm’r, 76 F.4th 49, 54
n.1 (2d Cir. 2023) (quoting Chai v. Comm’r, 851 F.3d 190, 218 (2d Cir.
2017)). In other words, assessment operates as a judgment against
the taxpayer. United States v. Farnsworth, 456 F.3d 394, 396 n.1 (3d
Cir. 2006). But before assessment, the IRS must first issue a notice
of deficiency to the taxpayer that tells the taxpayer what the IRS
believes is owed. I.R.C. §§ 6212(a), 6213(a). Once a taxpayer, like
Murrin, receives a notice of deficiency, she can challenge the IRS’s
position in the Tax Court. Id. § 6213(a). Only when the taxpayer
does not petition the Tax Court for a redetermination, or when the
taxpayer does so and the Tax Court’s judgment becomes final, may
the IRS issue a tax assessment. Id. In the meantime, the IRS’s
mailing of a notice of deficiency tolls the statute of limitations. Id.
§ 6503(a).
5a
Appendix A
indication Congress intended them to bear some different
import.” Williams v. Taylor, 529 U.S. 420, 431, 120 S. Ct.
1479, 146 L. Ed. 2d 435 (2000) (quoting Walters v. Metro.
Ed. Enters., Inc., 519 U.S. 202, 207, 117 S. Ct. 660, 136 L.
Ed. 2d 644 (1997)). “The ordinary or natural meaning may
be determined by looking to dictionary definitions while
keeping in mind the whole statutory text, the purpose,
and context of the statute, and relevant precedent.”
United States v. Brow, 62 F.4th 114, 120, 77 V.I. 820 (3d
Cir. 2023). 3 “We also are mindful that ‘[t]here is no canon
against using common sense in construing laws as saying
what they obviously mean.’” United States v. Lucidonio,
137 F.4th 177, 183 (3d Cir. 2025) (alteration in original)
(quoting Koons Buick Pontiac GMC, Inc. v. Nigh, 543 U.S.
50, 63, 125 S. Ct. 460, 160 L. Ed. 2d 389 (2004)).
Again, the question before us is whether the “intent
to evade tax” exception in § 6501(c)(1) requires taxpayer
intent. We conclude that it does not. Absent from § 6501
(c)(1) is any express or implied textual indication that
the “intent to evade tax” is cabined to the taxpayer. The
structure of the statute focuses on the presence of “a false
or fraudulent return with the intent to evade tax.” I.R.C.
§ 6501(c)(1). That is, an “intent to evade tax” must attach to
3. ”[O]ur job is to interpret the words consistent with their
‘ordinary meaning . . . at the time Congress enacted the statute.’”
Wis. Cent. Ltd. v. United States, 585 U.S. 274, 277, 138 S. Ct. 2067,
201 L. Ed. 2d 490 (2018) (alteration in original) (quoting Perrin
v. United States, 444 U.S. 37, 42, 100 S. Ct. 311, 62 L. Ed. 2d 199
(1979)). Because § 6501(c)(1) dates to 1918, we discuss definitions
contemporaneous to that period. See infra III.B. (discussing § 6501
(c)(1)’s origin in the Revenue Act of 1918).
6a
Appendix A
the “false or fraudulent return.”4 But neither requirement
facially includes any indication that the taxpayer must be
the actor who intends to evade tax.
First, the plain and ordinary meaning of the phrase
“intent to evade tax” reveals no taxpayer-only limitation.
Neither “intent” nor “to evade” cabin the phrase “intent
to evade tax” to a taxpayer because nothing about
either term is restricted to certain individuals. 5 The
only constituent part of “intent to evade tax” that does
bear a connection to taxpayers is the term “tax.” That
is because “tax[es]” are “portions of the property of the
4. Section 6501(c)(1)’s two requirements are joined by “with,”
establishing that “the intent to evade tax” must join the “false or
fraudulent return.” See, e.g., With, Concise Oxford Dictionary of
Current English (7th ed. 1919) (explaining that “with” is a preposition
meaning, among other things, “having, carrying, possessed of,
characterized by”); see also With, Webster’s Home, School, and Office
Dictionary (1916) (“[D]enoting nearness or connection.”).
5. ”Intent” refers to a “[p]urpose; formulated design; a resolve
to do or forbear a particular act; aim; determination.” Intent, Black’s
Law Dictionary (2d ed. 1910). Said otherwise, “intent” is “the exercise
of intelligent will, the mind being fully aware of the nature and
consequences of the act which is about to be done, and with such
knowledge, and with full liberty of action, willing and electing to do
it.” Id. Accord Intent, Concise Oxford Dictionary of Current English
(7th ed. 1919) (“Intention, purpose, esp. with [intent] to defraud
[et]c.” (cleaned up)); Intent, Webster’s Home, School, and Office
Dictionary (1916) (explaining that, when used as a noun, “intent”
means “purpose; aim”). Evade means to “escape” or “avoid.” Evade,
Concise Oxford Dictionary of Current English (7th ed. 1919); Evade,
Webster’s Home, School, and Office Dictionary (1916); cf. Evasion,
Black’s Law Dictionary (2d ed. 1910) (“A subtle endeavoring to set
aside truth or to escape the punishment of the law.”).
7a
Appendix A
citizen, demanded and received by the government, to be
disposed of to enable it to discharge its functions.” Tax,
Black’s Law Dictionary (2d ed. 1910); see Tax, Webster’s
Home, School, and Office Dictionary (1916) (“[A] rate or
duty on income or property[.]”). As a result, taxes refer
to duties necessarily owed by an individual or entity. See
Tax, Concise Oxford Dictionary of Current English (7th
ed. 1919) (“Contribution levied on persons, property, or
business, for support of government[.]”). But reading the
whole phrase together, an “intent to evade tax” means that
someone planned to avoid duties owed by an individual or
entity to the Government. So, while an “intent to evade”
does concern the taxes a taxpayer owes, the plain meaning
of the words does not imply a specific actor.
Second, Congress’s decision to use passive voice in
§ 6501(c)(1) further evinces that the statute does not
depend on a taxpayer’s intent. Congress drafted § 6501
(c)(1) by focusing “on an event that occurs without respect
to a specific actor, and therefore without respect to any
[specific] actor’s intent or culpability.” Dean v. United
States, 556 U.S. 568, 572, 129 S. Ct. 1849, 173 L. Ed. 2d
785 (2009). And by wording it this way, without listing who
must intend to evade tax, “Congress was agnostic about
who” did so. Bartenwerfer v. Buckley, 598 U.S. 69, 76, 143
S. Ct. 665, 214 L. Ed. 2d 434 (2023) (cleaned up) (quoting
Watson v. United States, 552 U.S. 74, 81, 128 S. Ct. 579,
169 L. Ed. 2d 472 (2007)).6
6. ”It is true, of course, that context can confine a passive-voice
sentence to a likely set of actors.” Bartenwerfer, 598 U.S. at 76. But
as we explain below, context here confirms that Congress’s use of
passive voice in § 6501(c)(1) was purposeful. See infra.
8a
Appendix A
Murrin responds with a few textual arguments. We
begin with the strongest— that because the tax evaded is
that owed by the taxpayer, the plainest reading of “intent
to evade tax” must refer to a taxpayer’s conduct. Any other
reading, Murrin stresses, would unnaturally interpret the
statute contrary to any commonsense interpretation of it.
Cf. United States v. Fontaine, 697 F.3d 221, 228, 57 V.I. 914
(3d Cir. 2012) (explaining that “we should ‘presume[] that
the legislature intended exceptions to its language, which
would avoid [absurd]’ results” (alterations in original)
(quoting Gov’t of V.I. v. Berry, 604 F.2d 221, 225, 16 V.I.
614 (3d Cir. 1979))). This is because the “plainest reading
of section 6501(c)(1) is that the statute refers to the intent
of the person with the legal duty to file the tax return and
pay the tax: the taxpayer.” Opening Br. 24.
Murrin’s argument is a fair one. And it certainly is
true that § 6501(c)(1) applies when a taxpayer intends to
evade tax. That much is beyond debate. But the plainest
and most straightforward reading of § 6501(c)(1) is that
it simply requires an “intent to evade tax” attached to
a “false or fraudulent return,” and whether a taxpayer,
accountant, lawyer, or tax preparer evinced such intent is
beside the point. And while Murrin contends such a view
is nonsensical, the Code establishes that Congress knows
how to limit statutes to taxpayers when it intends to do
so. See infra III.B. (detailing why §§ 6161(b)(3), 6663(c),
6664(c)(1), and 7454(a) establish this conclusion). That
only strengthens our bottom-line view that were § 6501
(c)(1) limited to a taxpayer’s intent, we would expect to
see evidence of that in the statute.
9a
Appendix A
Next, Murrin contends that because § 6501(a) explains
that the “return” at issue is the taxpayer’s, “the fraudulent
intent referenced in section 6501(c)(1) is by implication
limited to fraud by the taxpayer.” Opening Br. 23-24.
Not so. As the Tax Court explained, “[t]he specification
of whose tax or return is at issue does not suggest, much
less dictate, who had to intend to evade tax.” App. 10.
Moreover, Congress expressly used the term “taxpayer”
in § 6501(a) to define what return is at issue but declined
to use the same qualifier in § 6501(c)(1). And “[w]hen
Congress includes particular language in one section
of a statute but omits it from a neighbor, we normally
understand that difference in language to convey a
difference in meaning.” Bittner v. United States, 598 U.S.
85, 94, 143 S. Ct. 713, 215 L. Ed. 2d 1 (2023).
Murrin also argues that the Tax Court’s interpretation
focuses only on the “false or fraudulent return” and thus
renders “intent to evade tax” superfluous. We recognize
that we must “give effect, if possible, to every clause and
word of a statute,” but our interpretation of § 6501(c)(1)
renders nothing superfluous in this statute. Montclair
Twp. v. Ramsdell, 107 U.S. 147, 152, 2 S. Ct. 391, 27 L.
Ed. 431 (1883); see also Arlington Cent. Sch. Dist. Bd. of
Educ. v. Murphy, 548 U.S. 291, 299 n.1, 126 S. Ct. 2455,
165 L. Ed. 2d 526 (2006) (“[I]t is generally presumed
that statutory language is not superfluous.”). As the Tax
Court correctly explained, “[t]he obvious construction
of the statutory text is that the intent to evade tax must
be present in a false or fraudulent return, irrespective
of who possesses that intent.” App. 10 (quoting BASR
P’ship v. United States, 795 F.3d 1338, 1358 (Fed. Cir.
2015) (Prost, C.J., dissenting)). But that construction of
10a
Appendix A
§ 6501(c)(1) still requires an act (a “false or fraudulent
return”) and a mental state (“with the intent to evade
tax”). As a result, we fail to see why our interpretation
of § 6501(c)(1) somehow excises “the intent to evade tax”
from the statute.7
B. Section 6501(c)(1)’s Statutory Context Shows
That Congress Knows How to Limit Statutes
to Taxpayers but Did Not Do So Here
We turn next to the statutory context of § 6501
(c)(1). “It is a fundamental canon of statutory construction
that the words of a statute must be read in their context
and with a view to their place in the overall statutory
scheme.” West Virginia v. EPA, 597 U.S. 697, 721, 142 S.
Ct. 2587, 213 L. Ed. 2d 896 (2022) (quoting Davis v. Mich.
Dep’t of Treasury, 489 U.S. 803, 809, 109 S. Ct. 1500,
103 L. Ed. 2d 891 (1989)); see also Davis, 489 U.S. at 809
(“[S]tatutory language cannot be construed in a vacuum.”).
And the statutory context shows that Congress knows how
7. We pause to mention Murrin’s remaining argument that is
adjacent to § 6501(c)(1)’s text—that our interpretation is unworkable.
By not limiting § 6501(c)(1) to a taxpayer’s intent, Murrin argues
that we would offend basic due process and fairness principles by
not defining whose intent might matter. We need not determine the
outer bounds of how an “intent to evade tax” applies in every context,
however, because Murrin stipulated that her tax preparer intended to
evade her taxes. But to the extent that Murrin suggests that courts
are simply unable to address whether other third parties’ intent to
evade tax can trigger § 6501(c)(1), the Tax Court has proven capable
of doing so. See, e.g., Browning v. Comm’r, T.C. Memo 2011-261, 102
T.C.M. (CCH) 460, at *13-16 (2011) (conducting a detailed factual
finding separately as to a taxpayer and his accountant for purposes
of whether § 6501(c)(1) applied to the taxpayer).
11a
Appendix A
to limit statutes to taxpayer conduct when it wants to do
so. For example, § 6663(a) authorizes the IRS to impose a
fraud penalty when “any part of any underpayment of tax
required to be shown on a return is due to fraud.” I.R.C.
§ 6663(a). But the fraud penalty does not apply when “the
taxpayer acted in good faith” and had “reasonable cause.”
Id. § 6664(c)(1). Nor does it apply for a joint return filed by
a married couple “unless some part of the underpayment
is due to the fraud of such spouse.” Id. § 6663(c). And “[i]n
any proceeding involving the issue whether the petitioner
[that is, the taxpayer] has been guilty of fraud with intent
to evade tax,” Congress required the IRS to carry the
burden of proof on that issue. Id. § 7454(a).
A few important lessons flow from the Code’s fraud
provisions in §§ 6663, 6664, and 7454. The first is that the
fraud penalty in § 6663(a) simply says it applies when an
underpayment is “due to fraud,” but Congress’s express
reference to a taxpayer’s conduct three times in §§ 6663(c),
6664(c)(1), and 7454(a) make clear that the “fraud” in
§ 6663(a) refers to that of a taxpayer and not a third party’s
fraud. Missing from the “intent to evade tax” in § 6501(c)(1)
is any such contextual limitation, confirming that “intend
to evade tax” includes no implied limitation. The second
is that §§ 6663(c), 6664(c)(1), and 7454(a) demonstrate
Congress’s knowledge about how to limit statutes to
taxpayers. 8 As a result, we find it difficult to believe
that despite Congress limiting provisions elsewhere by
reference to a taxpayer’s conduct or allegations directed
8. Congress likewise knows how to limit statutes to third
parties like tax preparers. See, e.g., I.R.C. § 6694(a) (penalizing
tax preparers for, among other things, taking unreasonable tax
positions).
12a
Appendix A
against the taxpayer, Congress included a limitation
within “a false or fraudulent return with the intent to
evade tax” despite not saying so. Id. § 6501(c)(1).
Murrin disagrees with our view of the Code for two
reasons, but neither persuades. First, Murrin contends
that the fraud penalty under § 6663(a) cuts against our
interpretation. Because “due to fraud” in § 6663(a) and
“intent to evade tax” in § 6501(c)(1) both are written in the
passive voice, Murrin suggests that § 6663(a)’s limitation
to a taxpayer’s conduct must carry over to § 6501(c)(1). As
support, Murrin explains that both provisions date to the
Revenue Act of 1918, and in that Act the phrase “intent to
evade tax” described both the fraud penalty and statuteof-limitations exception. See Revenue Act of 1918, Pub. L.
No. 65-254, §§ 250(b), 40 Stat. 1057, 1083 (applying fraud
penalty when an “understatement is false or fraudulent
with intent to evade the tax”); id. § 250(d), 40 Stat. at 1083
(applying exception to statute of limitations “in the case of
false or fraudulent returns with intent to evade the tax”).
Murrin’s argument implicates the statutory canon
of construction of in pari materia—the axiom that “a
legislative body generally uses a particular word with
a consistent meaning in a given context.” Erlenbaugh
v. United States, 409 U.S. 239, 243, 93 S. Ct. 477, 34 L.
Ed. 2d 446 (1972). But identical words “may be variously
construed, not only when they occur in different statutes,
but when used more than once in the same statute or even
in the same section.” Env’t Def. v. Duke Energy Corp., 549
U.S. 561, 574, 127 S. Ct. 1423, 167 L. Ed. 2d 295 (2007)
(quoting Atl. Cleaners & Dyers, Inc. v. United States,
13a
Appendix A
286 U.S. 427, 433, 52 S. Ct. 607, 76 L. Ed. 1204 (1932)).
“Thus, the ‘natural presumption that identical words used
in different parts of the same act are intended to have the
same meaning’” is not inexorable, and it “readily yields
whenever there is such variation in the connection in
which the words are used as reasonably to warrant the
conclusion that they were employed in different parts of
the act with different intent.’” Id. (quoting Atl. Cleaners
& Dyers, Inc., 286 U.S. at 433).
Looking past the fact that the modern-day fraud
penalty differs in text from the historical analogue,
Murrin points to the Revenue Act of 1918, which includes
the same contextual limitations present in the Code today.
Section 250(b), housing the fraud penalty now codified
as § 6663(a), included various limitations that referenced
taxpayers, their actions, and intent, but § 250(d), housing
the statute-of-limitations exception now codified as
§ 6501(c)(1), did not. See Revenue Act of 1918, Pub. L. No.
65-254, § 250(b), 40 Stat. 1057, 1083 (exempting application
of fraud penalty “if the return is made in good faith and
the understatement of the amount in the return is not due
to any fault of the taxpayer” or imposing a smaller penalty
for understatements “due to negligence on the part of the
taxpayer, but without intent to defraud”). Thus, Murrin’s
emphasis on history only proves the same point reached
by reference to the Code. Congress has never limited the
scope of the statute-of-limitations exception despite doing
so in the fraud penalty.9
9. Murrin makes the same argument related to § 7454(a), which
shifts the burden of proof to the IRS when it alleges “the petitioner
[that is, the taxpayer] has been guilty of fraud with intent to evade
14a
Appendix A
Second, Murrin points to another provision, § 6161(b)
(3), as support for why our interpretation is incongruous
with the Code. That provision disallows extensions of time
for payments of tax when a “deficiency is due to negligence,
to intentional disregard of rules and regulations, or to
fraud with intent to evade tax.” I.R.C. § 6161(b)(3). Section
6161(b)(3) is drafted like § 6501(c)(1), meaning nothing in
§ 6161(b)(3) suggests any limitation to its application when
a third party intends to evade tax. Murrin argues that
it is absurd to think that Congress would allow a third
party to impact a taxpayer’s ability to seek an extension
of time, further establishing the unreasonableness of our
interpretation of § 6501(c)(1).
We disag ree w ith Mur r in. Section 6161(b)(3)
establishes yet another piece of evidence supporting our
interpretation of § 6501(c)(1) and the Code. Sections 6161(b)
(3) and 6501(c)(1) deal with the IRS’s receipt of accurate
payments of tax, and their provisions are not limited to a
taxpayer’s intent. Sections 6663(c), 6664(c)(1), and 7454(a)
deal with the imposition of fraud penalties on top of what
taxes might be owed, and those provisions are limited to
a taxpayer’s intent. Read together, Congress treats the
payments of tax and the imposition of penalties differently.
And it makes sense that Congress would “impose penalties
on the taxpayer only when the taxpayer intended to evade
the tax, while at the same time allowing the IRS to collect
tax.” Murrin suggests any case involving an intent to evade tax
relates to a taxpayer. But § 7454(a) is yet another example of how
Congress meant what it said and said what it meant; were § 6501
(c)(1) limited to a taxpayer’s intent to evade tax, it could have drafted
it precisely like § 7454(a) by specifying to whom the statute applies.
15a
Appendix A
taxes based on an understated fraudulent return at any
time.” BASR, 795 F.3d at 1360 (Prost, C.J., dissenting);
see also Asphalt Indus., Inc. v. Comm’r, 384 F.2d 229, 234
(3d Cir. 1967) (explaining that the fraud penalty under
§ 6663(a) not only gathers revenue but also operates as a
“civil sanction” that “bears a close resemblance to criminal
liability”).
C.
Precedent Likewise Supports Our View
Finally, we examine the relevant precedent. The
Supreme Court’s recent analysis of Congress’s use of
passive voice also confirms our reading of § 6501(c)(1). In
Bartenwerfer, the Supreme Court analyzed a provision of
the Bankruptcy Code, 11 U.S.C. § 523(a)(2)(A), specifying
that debt is not dischargeable when money is “obtained
by . . . fraud.” 598 U.S. at 74. Because Bartenwerfer did
not know about the fraud committed by her partner,
she argued that the judgment was dischargeable in
bankruptcy. Id. at 75. Bartenwerfer reasoned that “the
statute is most naturally read to bar the discharge of debts
for money obtained by the debtor’s fraud,” as the passive
voice of the statute “hides the relevant actor in plain sight.”
Id. The Supreme Court unanimously disagreed because
the statute’s “[p]assive voice pull[ed] the actor off the
stage,” meaning that all the Bankruptcy Code required
was that “debt must result from someone’s fraud.” Id. at
75-76.
Section 6501(c)(1)’s “intent to evade tax” language
is like the “obtained by fraud” language at issue in
Bartenwerfer. Neither identifies who must intend to evade
16a
Appendix A
tax or who must obtain property by fraud. But like the
language in Bartenwerfer, § 6501(c)(1) focuses on an event
without regard to an actor—that is, Congress focused on
a “false or fraudulent return with the intent to evade tax”
without saying who must act. By pulling the taxpayer off
the stage, Congress made its reasoning clear. The statute
of limitations does not apply when someone intends to
evade tax in the filing of a false or fraudulent return,
taxpayer or not.10
Bartenwerfer’s analysis about the use of passive
voice in statutes also aligns with the Supreme Court’s
last opinion interpreting § 6501(c)(1). See Badaracco v.
Comm’r, 464 U.S. 386, 104 S. Ct. 756, 78 L. Ed. 2d 549
(1984). Badaracco concerned a dispute about whether the
statute of limitations is suspended under § 6501(c)(1) if an
amended non-fraudulent tax return is filed to correct a
previously filed fraudulent one. Id. at 388. Because § 6501
(c)(1) allows a tax assessment “at any time,” the Supreme
Court held that nothing in the statute’s “unqualified
language” could “be construed to suspend its operation
10. The Supreme Court also discussed common law fraud
because while Bartenwerfer “paint[ed] a picture of liability imposed
willy-nilly on hapless bystanders,” common law fraud principles
establish that “innocent people are sometimes held liable for fraud
they did not personally commit.” Bartenwerfer, 598 U.S. at 82-83.
Murrin argues this fact makes Bartenwerfer inapposite because
“tax-return preparers are not agents” and, thus, common law fraud’s
application to this case would differ. Loving v. IRS, 742 F.3d 1013,
1017, 408 U.S. App. D.C. 281 (D.C. Cir. 2014). But even were that
true, Bartenwerfer’s more general view that a passive-voice phrase,
“on its face,” “pulls the actor off the stage” would remain. 598 U.S.
at 75. So too would our view of § 6501(c)(1).
17a
Appendix A
in the light of a fraudulent filer’s subsequent repentant
conduct.” Id. at 393. And the Supreme Court explained
that a statute of limitations like § 6501(c)(1) “must receive
a strict construction in favor of the Government.” Id. at
391 (quoting E.I. Dupont de Nemours & Co. v. Davis, 264
U.S. 456, 462, 44 S. Ct. 364, 68 L. Ed. 788 (1924)).11 The
taxpayers’ position in Badaracco was similar to Murrin’s,
who advocates for a position unsupported by the statute’s
generally applicable language—language that we must
read in the IRS’s favor. Thus, we see nothing in the text
of § 6501(c)(1) or in case law from the Supreme Court
supporting Murrin’s preferred interpretation; instead, we
see case law supporting the opposite conclusion.
Moving past Badaracco and Bartenwerfer, Murrin
responds that we are bound to adopt her interpretation
because of this Court’s holding in Asphalt Industries, 384
F.2d at 229. But Murrin misreads Asphalt. The president of
Asphalt embezzled money and thus caused the corporation
to file false or fraudulent tax returns. Id. at 231. We held
that the president’s embezzlement was not imputed to the
corporation for purposes of § 6501(c)(1) in part because
the tax fraud was simply a “subordinate element in [the
11. Murrin suggests that this Court does not construe statutes
of limitations in the IRS’s favor when the taxpayer does not act
fraudulently. Opening Br. 46 (citing Lauckner v. United States, 68
F.3d 69 (3d Cir. 1995)). We said no such thing in Lauckner, and the
next year interpreted § 6501 with reference to the Supreme Court’s
direction in Badaracco to strictly construe it in a light favorable
to the IRS. Bachner v. Comm’r, 81 F.3d 1274, 1279 (3d Cir. 1996).
And regardless, strict construction or not, Murrin’s argument runs
counter to § 6501(c)(1)’s text and context.
18a
Appendix A
president’s] need to conceal his embezzlement.” Id. at
235. We did not consider whether a party other than the
taxpayer could independently satisfy § 6501(c)(1). And no
one argued that the president’s embezzlement constituted
an intent to evade tax owed by Asphalt. Instead, we
assumed “for present purposes” that “the meaning of
fraud” is the same under both § 6501(c)(1) and § 6663(a)
and held that the record was insufficient for § 6501(c)(1)
to apply. Id. at 232. Thus, Asphalt does not answer the
interpretive question before the Court today.
Murrin argues that affirming the Tax Court would
“reject[] 100 years of tax jurisprudence,” but that is not
so. Opening Br. 2. As Murrin explains, it appears that
the IRS first opined that § 6501(c)(1) applies in situations
other than where a taxpayer intended to evade tax in 2001.
IRS Field Service Advisory 200126019, 2001 WL 729653
(issued June 29, 2001). The Tax Court then held that
§ 6501(c)(1) applied in situations beyond when a taxpayer
intends to evade tax. See Allen v. Comm’r, 128 T.C. 37
(2007) (applying § 6501(c)(1) because of a tax preparer’s
intent to evade tax). Following Allen, the Tax Court has
applied § 6501(c)(1) in the context of a non-taxpayer’s intent
on several occasions, including on returns prepared by the
same tax preparer Murrin used. See Finnegan v. Comm’r,
T.C. Memo 2016-118, at *7-9 (2016) (finding Howell’s
intent to evade tax rendered § 6501(c)(1) applicable); see
also Ames-Mechelke v. Comm’r, T.C. Memo 2013-176, 106
T.C.M. (CCH) 77, at *7 (2013) (finding § 6501(c)(1) applied
because of a tax preparer). Our holding today therefore
does not reject a century’s worth of tax jurisprudence;
instead, we continue the well-trod ground laid by the Tax
Court.
19a
Appendix A
We do acknowledge, however, that our holding today
departs from the Federal Circuit’s opinion that the IRS
is limited “to the three-year limitations period unless the
taxpayer possessed the intent to evade tax.” BASR, 795
F.3d at 1350 (majority opinion).12 The Federal Circuit, in a
decision predating Bartenwerfer, reached this conclusion
because it found the statute’s text revealed little and
instead relied heavily on context, congressional intent,
and legislative history. See, e.g., id. at 1343-45. Because we
find that § 6501(c)(1)’s text and statutory context include
no requirement that an “intent to evade tax” must come
from a taxpayer, we respectfully part ways. Accord id. at
1358 (Prost, C.J., dissenting) (“[T]he obvious construction
12. Murrin contends that the Fifth Circuit in Payne v. Comm’r,
224 F.3d 415 (5th Cir. 2000), came to the same view as the Federal
Circuit. The Fifth Circuit, in an appeal about whether the Tax
Court properly found that a taxpayer intended to evade tax under
§ 6501(c)(1), described how the IRS had to show evidence “from
which fraudulent intent on the part of the taxpayer can be properly
inferred.” Id. at 421 (emphasis omitted). The Fifth Circuit described
the case in those terms because the actor at issue was the taxpayer.
But nowhere did that court discern the meaning and scope of § 6501
(c)(1) for a third party’s actions.
The only other Circuit that confronted this issue aligns with our
view. City Wide Transit, Inc. v. Comm’r, 709 F.3d 102 (2d Cir. 2013).
The Second Circuit, citing the Tax Court’s post-Allen precedent,
stated: “we conclude that the limitations period for assessing [the
taxpayer’s] taxes is extended if the taxes were understated due
to fraud of the preparer.” Id. at 107. But the Second Circuit then
explained how the issue before it was a “narrow” one because
the taxpayer conceded that if the tax preparer filed taxes with an
intent to evade, § 6501(c)(1) applied. As a result, while City Wide
Transit appears to bolster our view, we are uncertain whether the
Second Circuit’s statement concerning § 6501(c)(1) is cabined to the
taxpayers’ concessions on appeal and, thus, do not rely on it.
20a
Appendix A
of the statutory text is that the intent to evade tax must
be present in a false or fraudulent return, irrespective of
who possesses that intent.”).
*****
Murrin faces financial pain. According to the notice of
deficiency, Murrin owes $65,318 in underpayments of tax
and $13,064 in accuracy-related penalties. And applying
the normal rate of interest to these deficiencies, she may
be charged with owing an estimated $250,000 in interest.13
All date to tax returns from decades ago. Murrin finds
this patently unfair because her tax preparer caused the
underpayments of tax. We understand her perspective.
But we are bound to “consider . . . whether the policy
[Murrin] favor[s] is that which Congress effectuated by
its enactment of § 6501.” Badaracco, 464 U.S. at 398.
And while Congress has limited imposing fraud penalties
against a taxpayer without a taxpayer’s intent, § 6501(c)(1)’s
13. We emphasize that Murrin’s accuracy-related penalties and
interest on the deficiencies are not before us. Murrin stipulated to
the IRS’s proper determination of the accuracy-related penalties.
Because the Tax Court lacked jurisdiction to adjudicate issues
relating to interest imposed on underpayments by § 6601(a), so do we.
See Comm’r v. McCoy, 484 U.S. 3, 6-7, 108 S. Ct. 217, 98 L. Ed. 2d 2
(1987); Sunoco Inc. v. Comm’r, 663 F.3d 181, 189 (3d Cir. 2011). And in
the normal course, even where the statute-of-limitations exception in
§ 6501(c)(1) applies, taxpayers are free to challenge accuracy-related
penalties and interest. See, e.g., I.R.C. § 6664(c)(1) (rendering the
accuracy-related penalty and fraud penalty inapplicable when the
taxpayer had a “reasonable cause” for the tax position and “acted in
good faith”). Thus, nothing in this opinion should be read to foreclose
any challenge to the assessment of interest in a future proceeding.
21a
Appendix A
text, context, and precedent establish that Congress was
agnostic about whether the taxpayer intended to evade
tax for purposes of the IRS’s full and accurate assessment
of taxes.
IV. CONCLUSION
For the reasons discussed above, we will affirm the
judgment of the Tax Court.
22a
Appendix
B
APPENDIX B — OPINION
OF THE
UNITED STATES
COURT OF APPEALS FOR THE THIRD CIRCUIT,
FILED AUGUST 18, 2025
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 24-2037
STEPHANIE MURRIN,
Appellant,
v.
COMMISSIONER OF INTERNAL REVENUE
On Appeal from the United States Tax Court
U.S. Tax Court No. 19-14614
Tax Court Judge: Patrick J. Urda
Argued April 30, 2025
Before: KRAUSE, BIBAS, and
MONTGOMERY-REEVES,
Circuit Judges.
(Filed August 18, 2025)
OPINION OF THE COURT
MONTGOMERY-REEVES, Circuit Judge.
Typically, the Internal Revenue Service (“IRS”) must
assess tax within three years from the date an individual
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taxpayer files her return. I.R.C. § 6501(a).1 An exception
to this statute of limitations exists, however. When there
is “a false or fraudulent return with the intent to evade
tax,” the IRS can assess tax “at any time.” Id. § 6501(c)(1).
But whose “intent” is required for this exception to the
statute of limitations to apply? That is the subject of this
appeal. Appellant Stephanie Murrin argues that only the
taxpayer’s intent matters. That is, the exception applies
only if the taxpayer herself intends to evade tax. And
because Murrin’s tax preparer prepared her taxes with
an intent to evade tax while she did not, the exception to
the statute of limitations does not apply. We understand
Murrin’s frustration with the IRS’s decision to assess tax
beyond the statute of limitations due to the wrongdoing of
someone other than her. But we are bound by the statute.
And because the statute is agnostic about who must intend
to evade tax, we hold that taxpayer intent is not required.
Thus, we will affirm the judgment of the Tax Court.
I.
BACKGROUND
The material facts in this appeal are undisputed.
Murrin underpaid her taxes from 1993 to 1999 because
her tax preparer, Duane Howell, placed false or fraudulent
entries on Murrin’s tax returns with an intent to evade tax.
But Murrin did not cause the false or fraudulent entries,
and she did not intend to evade tax.
Over 20 years later, in 2019, the IRS issued a notice
of deficiency to Murrin regarding underpayments on her
1. The “Code” refers to the Internal Revenue Code. See 26
U.S.C. § 1 et seq.
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tax returns between 1993 and 1999. Id. § 6212(a). Murrin
filed a petition in the Tax Court for a redetermination
of the deficiency. Id. § 6213(a). Murrin agreed with the
IRS that she underpaid $65,318 in tax, and she did not
dispute the application of an accuracy-related penalty of
$13,064 for the underpayment or the imposition of interest.
Instead, Murrin argued that the IRS did not act within
the three-year statute of limitations. The Tax Court held
that § 6501(c)(1) applies because Howell prepared Murrin’s
false or fraudulent tax returns with an intent to evade tax,
and thus the statute of limitations under § 6501(a) did not
bar the IRS’s notice of deficiency. Murrin appealed.
II. JURISDICTION AND STANDARD OF REVIEW
The Tax Court had jurisdiction under I.R.C. §§ 6213(a)
and 7442. We have jurisdiction under I.R.C. § 7482
(a)(1). We exercise de novo review over the Tax Court’s
interpretation of the Code. Sunoco Inc. v. Comm’r, 663
F.3d 181, 185 (3d Cir. 2011).
III. DISCUSSION
This appeal turns on our interpretation of § 6501.
Section 6501(a) states that “any tax imposed by [the
Code] shall be assessed within 3 years after the return
was filed”— that is, three years from the filing of “the
return required to be filed by the taxpayer.” Subsection
(c) then includes twelve exceptions to the three-year
statute of limitations, one of which is relevant here. Section
6501(c)(1) provides, in full, that “[i]n the case of a false or
fraudulent return with the intent to evade tax, the tax
may be assessed, or a proceeding in court for collection of
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such tax may be begun without assessment, at any time.” 2
To determine whether taxpayer intent is necessary to
trigger the indefinite limitations period in § 6501(c)(1), we
examine (1) the text of § 6501(c)(1), (2) the statutory context
of § 6501(c)(1), and (3) relevant precedent. All three reveal
that § 6501(c)(1) is not limited to a taxpayer’s intent. We
address each in turn.
A.
Section 6501(c)(1)’s Plain Text Applies to More
Than Taxpayers
“Our analysis begins with the statutory text.”
Mississippi ex rel. Hood v. AU Optronics Corp., 571 U.S.
161, 168, 134 S. Ct. 736, 187 L. Ed. 2d 654 (2014) (citing
Sebelius v. Cloer, 569 U.S. 369, 376, 133 S. Ct. 1886, 185 L.
Ed. 2d 1003 (2013)). “We give the words of a statute their
‘ordinary, contemporary, common meaning,’ absent an
indication Congress intended them to bear some different
2. Section 6501(c)(1) keys the statute of limitations to
“assessment.” A tax assessment is simply “what the taxpayer is
required to pay the Government.” Soni v. Comm’r, 76 F.4th 49, 54
n.1 (2d Cir. 2023) (quoting Chai v. Comm’r, 851 F.3d 190, 218 (2d Cir.
2017)). In other words, assessment operates as a judgment against
the taxpayer. United States v. Farnsworth, 456 F.3d 394, 396 n.1 (3d
Cir. 2006). But before assessment, the IRS must first issue a notice
of deficiency to the taxpayer that tells the taxpayer what the IRS
believes is owed. I.R.C. §§ 6212(a), 6213(a). Once a taxpayer, like
Murrin, receives a notice of deficiency, she can challenge the IRS’s
position in the Tax Court. Id. § 6213(a). Only when the taxpayer
does not petition the Tax Court for a redetermination, or when the
taxpayer does so and the Tax Court’s judgment becomes final, may
the IRS issue a tax assessment. Id. In the meantime, the IRS’s
mailing of a notice of deficiency tolls the statute of limitations. Id.
§ 6503(a).
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import.” Williams v. Taylor, 529 U.S. 420, 431, 120 S. Ct.
1479, 146 L. Ed. 2d 435 (2000) (quoting Walters v. Metro.
Ed. Enters., Inc., 519 U.S. 202, 207, 117 S. Ct. 660, 136 L.
Ed. 2d 644 (1997)). “The ordinary or natural meaning may
be determined by looking to dictionary definitions while
keeping in mind the whole statutory text, the purpose,
and context of the statute, and relevant precedent.”
United States v. Brow, 62 F.4th 114, 120, 77 V.I. 820 (3d
Cir. 2023). 3 “We also are mindful that ‘[t]here is no canon
against using common sense in construing laws as saying
what they obviously mean.’” United States v. Lucidonio,
137 F.4th 177, 183 (3d Cir. 2025) (alteration in original)
(quoting Koons Buick Pontiac GMC, Inc. v. Nigh, 543 U.S.
50, 63, 125 S. Ct. 460, 160 L. Ed. 2d 389 (2004)).
Again, the question before us is whether the “intent
to evade tax” exception in § 6501(c)(1) requires taxpayer
intent. We conclude that it does not. Absent from § 6501
(c)(1) is any express or implied textual indication that
the “intent to evade tax” is cabined to the taxpayer. The
structure of the statute focuses on the presence of “a false
or fraudulent return with the intent to evade tax.” I.R.C.
§ 6501(c)(1). That is, an “intent to evade tax” must attach to
3. ”[O]ur job is to interpret the words consistent with their
‘ordinary meaning . . . at the time Congress enacted the statute.’”
Wis. Cent. Ltd. v. United States, 585 U.S. 274, 277, 138 S. Ct. 2067,
201 L. Ed. 2d 490 (2018) (alteration in original) (quoting Perrin
v. United States, 444 U.S. 37, 42, 100 S. Ct. 311, 62 L. Ed. 2d 199
(1979)). Because § 6501(c)(1) dates to 1918, we discuss definitions
contemporaneous to that period. See infra III.B. (discussing § 6501
(c)(1)’s origin in the Revenue Act of 1918).
27a
Appendix B
the “false or fraudulent return.”4 But neither requirement
facially includes any indication that the taxpayer must be
the actor who intends to evade tax.
First, the plain and ordinary meaning of the phrase
“intent to evade tax” reveals no taxpayer-only limitation.
Neither “intent” nor “to evade” cabin the phrase “intent
to evade tax” to a taxpayer because nothing about
either term is restricted to certain individuals. 5 The
only constituent part of “intent to evade tax” that does
bear a connection to taxpayers is the term “tax.” That
is because “tax[es]” are “portions of the property of the
4. Section 6501(c)(1)’s two requirements are joined by “with,”
establishing that “the intent to evade tax” must join the “false or
fraudulent return.” See, e.g., With, Concise Oxford Dictionary of
Current English (7th ed. 1919) (explaining that “with” is a preposition
meaning, among other things, “having, carrying, possessed of,
characterized by”); see also With, Webster’s Home, School, and Office
Dictionary (1916) (“[D]enoting nearness or connection.”).
5. ”Intent” refers to a “[p]urpose; formulated design; a resolve
to do or forbear a particular act; aim; determination.” Intent, Black’s
Law Dictionary (2d ed. 1910). Said otherwise, “intent” is “the exercise
of intelligent will, the mind being fully aware of the nature and
consequences of the act which is about to be done, and with such
knowledge, and with full liberty of action, willing and electing to do
it.” Id. Accord Intent, Concise Oxford Dictionary of Current English
(7th ed. 1919) (“Intention, purpose, esp. with [intent] to defraud
[et]c.” (cleaned up)); Intent, Webster’s Home, School, and Office
Dictionary (1916) (explaining that, when used as a noun, “intent”
means “purpose; aim”). Evade means to “escape” or “avoid.” Evade,
Concise Oxford Dictionary of Current English (7th ed. 1919); Evade,
Webster’s Home, School, and Office Dictionary (1916); cf. Evasion,
Black’s Law Dictionary (2d ed. 1910) (“A subtle endeavoring to set
aside truth or to escape the punishment of the law.”).
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Appendix B
citizen, demanded and received by the government, to be
disposed of to enable it to discharge its functions.” Tax,
Black’s Law Dictionary (2d ed. 1910); see Tax, Webster’s
Home, School, and Office Dictionary (1916) (“[A] rate or
duty on income or property[.]”). As a result, taxes refer
to duties necessarily owed by an individual or entity. See
Tax, Concise Oxford Dictionary of Current English (7th
ed. 1919) (“Contribution levied on persons, property, or
business, for support of government[.]”). But reading the
whole phrase together, an “intent to evade tax” means that
someone planned to avoid duties owed by an individual or
entity to the Government. So, while an “intent to evade”
does concern the taxes a taxpayer owes, the plain meaning
of the words does not imply a specific actor.
Second, Congress’s decision to use passive voice in
§ 6501(c)(1) further evinces that the statute does not
depend on a taxpayer’s intent. Congress drafted § 6501
(c)(1) by focusing “on an event that occurs without respect
to a specific actor, and therefore without respect to any
[specific] actor’s intent or culpability.” Dean v. United
States, 556 U.S. 568, 572, 129 S. Ct. 1849, 173 L. Ed. 2d
785 (2009). And by wording it this way, without listing who
must intend to evade tax, “Congress was agnostic about
who” did so. Bartenwerfer v. Buckley, 598 U.S. 69, 76, 143
S. Ct. 665, 214 L. Ed. 2d 434 (2023) (cleaned up) (quoting
Watson v. United States, 552 U.S. 74, 81, 128 S. Ct. 579,
169 L. Ed. 2d 472 (2007)).6
6. ”It is true, of course, that context can confine a passive-voice
sentence to a likely set of actors.” Bartenwerfer, 598 U.S. at 76. But
as we explain below, context here confirms that Congress’s use of
passive voice in § 6501(c)(1) was purposeful. See infra.
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Appendix B
Murrin responds with a few textual arguments. We
begin with the strongest—that because the tax evaded is
that owed by the taxpayer, the plainest reading of “intent
to evade tax” must refer to a taxpayer’s conduct. Any other
reading, Murrin stresses, would unnaturally interpret the
statute contrary to any commonsense interpretation of it.
Cf. United States v. Fontaine, 697 F.3d 221, 228, 57 V.I. 914
(3d Cir. 2012) (explaining that “we should ‘presume[] that
the legislature intended exceptions to its language, which
would avoid [absurd]’ results” (alterations in original)
(quoting Gov’t of the V.I. v. Berry, 604 F.2d 221, 225, 16 V.I.
614 (3d Cir. 1979))). This is because the “plainest reading
of section 6501(c)(1) is that the statute refers to the intent
of the person with the legal duty to file the tax return and
pay the tax: the taxpayer.” Opening Br. 24.
Murrin’s argument is a fair one. And it certainly is
true that § 6501(c)(1) applies when a taxpayer intends to
evade tax. That much is beyond debate. But the plainest
and most straightforward reading of § 6501(c)(1) is that
it simply requires an “intent to evade tax” attached to
a “false or fraudulent return,” and whether a taxpayer,
accountant, lawyer, or tax preparer evinced such intent is
beside the point. And while Murrin contends such a view
is nonsensical, the Code establishes that Congress knows
how to limit statutes to taxpayers when it intends to do
so. See infra III.B. (detailing why §§ 6161(b)(3), 6663(c),
6664(c)(1), and 7454(a) establish this conclusion). That
only strengthens our bottom-line view that were § 6501
(c)(1) limited to a taxpayer’s intent, we would expect to
see evidence of that in the statute.
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Appendix B
Next, Murrin contends that because § 6501(a) explains
that the “return” at issue is the taxpayer’s, “the fraudulent
intent referenced in section 6501(c)(1) is by implication
limited to fraud by the taxpayer.” Opening Br. 23-24.
Not so. As the Tax Court explained, “[t]he specification
of whose tax or return is at issue does not suggest, much
less dictate, who had to intend to evade tax.” App. 10.
Moreover, Congress expressly used the term “taxpayer”
in § 6501(a) to define what return is at issue but declined
to use the same qualifier in § 6501(c)(1). And “[w]hen
Congress includes particular language in one section
of a statute but omits it from a neighbor, we normally
understand that difference in language to convey a
difference in meaning.” Bittner v. United States, 598 U.S.
85, 94, 143 S. Ct. 713, 215 L. Ed. 2d 1 (2023).
Murrin also argues that the Tax Court’s interpretation
focuses only on the “false or fraudulent return” and thus
renders “intent to evade tax” superfluous. We recognize
that we must “give effect, if possible, to every clause and
word of a statute,” but our interpretation of § 6501(c)(1)
renders nothing superfluous in this statute. Montclair
Twp. v. Ramsdell, 107 U.S. 147, 152, 2 S. Ct. 391, 27 L.
Ed. 431 (1883); see also Arlington Cent. Sch. Dist. Bd. of
Educ. v. Murphy, 548 U.S. 291, 299 n.1, 126 S. Ct. 2455,
165 L. Ed. 2d 526 (2006) (“[I]t is generally presumed
that statutory language is not superfluous.”). As the Tax
Court correctly explained, “[t]he obvious construction
of the statutory text is that the intent to evade tax must
be present in a false or fraudulent return, irrespective
of who possesses that intent.” App. 10 (quoting BASR
P’ship v. United States, 795 F.3d 1338, 1358 (Fed. Cir.
31a
Appendix B
2015) (Prost, C.J., dissenting)). But that construction of
§ 6501(c)(1) still requires an act (a “false or fraudulent
return”) and a mental state (“with the intent to evade
tax”). As a result, we fail to see why our interpretation
of § 6501(c)(1) somehow excises “the intent to evade tax”
from the statute.7
B. Section 6501(c)(1)’s Statutory Context Shows
That Congress Knows How to Limit Statutes
to Taxpayers but Did Not Do So Here
We turn next to the statutory context of § 6501(c)(1).
“It is a fundamental canon of statutory construction that
the words of a statute must be read in their context and
with a view to their place in the overall statutory scheme.”
West Virginia v. EPA, 597 U.S. 697, 721, 142 S. Ct. 2587,
213 L. Ed. 2d 896 (2022) (quoting Davis v. Mich. Dep’t of
Treasury, 489 U.S. 803, 809, 109 S. Ct. 1500, 103 L. Ed.
2d 891 (1989)); see also Davis, 489 U.S. at 809 (“[S]tatutory
7. We pause to mention Murrin’s remaining argument that is
adjacent to § 6501(c)(1)’s text—that our interpretation is unworkable.
By not limiting § 6501(c)(1) to a taxpayer’s intent, Murrin argues
that we would offend basic due process and fairness principles by
not defining whose intent might matter. We need not determine the
outer bounds of how an “intent to evade tax” applies in every context,
however, because Murrin stipulated that her tax preparer intended to
evade her taxes. But to the extent that Murrin suggests that courts
are simply unable to address whether other third parties’ intent to
evade tax can trigger § 6501(c)(1), the Tax Court has proven capable
of doing so. See, e.g., Browning v. Comm’r, 102 T.C.M. (CCH) 460,
at *13-16 (2011) (conducting a detailed factual finding separately as
to a taxpayer and his accountant for purposes of whether § 6501(c)
(1) applied to the taxpayer).
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Appendix B
language cannot be construed in a vacuum.”). And the
statutory context shows that Congress knows how to
limit statutes to taxpayer conduct when it wants to do so.
For example, § 6663(a) authorizes the IRS to impose a
fraud penalty when “any part of any underpayment of tax
required to be shown on a return is due to fraud.” I.R.C.
§ 6663(a). But the fraud penalty does not apply when “the
taxpayer acted in good faith” and had “reasonable cause.”
Id. § 6664(c)(1). Nor does it apply for a joint return filed by
a married couple “unless some part of the underpayment
is due to the fraud of such spouse.” Id. § 6663(c). And “[i]n
any proceeding involving the issue whether the petitioner
[that is, the taxpayer] has been guilty of fraud with intent
to evade tax,” Congress required the IRS to carry the
burden of proof on that issue. Id. § 7454(a).
A few important lessons flow from the Code’s fraud
provisions in §§ 6663, 6664, and 7454. The first is that the
fraud penalty in § 6663(a) simply says it applies when an
underpayment is “due to fraud,” but Congress’s express
reference to a taxpayer’s conduct three times in §§ 6663(c),
6664(c)(1), and 7454(a) make clear that the “fraud” in
§ 6663(a) refers to that of a taxpayer and not a third party’s
fraud. Missing from the “intent to evade tax” in § 6501(c)(1)
is any such contextual limitation, confirming that “intend
to evade tax” includes no implied limitation. The second
is that §§ 6663(c), 6664(c)(1), and 7454(a) demonstrate
Congress’s knowledge about how to limit statutes to
taxpayers. 8 As a result, we find it difficult to believe
8. Congress likewise knows how to limit statutes to third
parties like tax preparers. See, e.g., I.R.C. § 6694(a) (penalizing
tax preparers for, among other things, taking unreasonable tax
positions).
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Appendix B
that despite Congress limiting provisions elsewhere by
reference to a taxpayer’s conduct or allegations directed
against the taxpayer, Congress included a limitation
within “a false or fraudulent return with the intent to
evade tax” despite not saying so. Id. § 6501(c)(1).
Murrin disagrees with our view of the Code for two
reasons, but neither persuades. First, Murrin contends
that the fraud penalty under § 6663(a) cuts against our
interpretation. Because “due to fraud” in § 6663(a) and
“intent to evade tax” in § 6501(c)(1) both are written in the
passive voice, Murrin suggests that § 6663(a)’s limitation
to a taxpayer’s conduct must carry over to § 6501(c)(1). As
support, Murrin explains that both provisions date to the
Revenue Act of 1918, and in that Act the phrase “intent to
evade tax” described both the fraud penalty and statuteof-limitations exception. See Revenue Act of 1918, Pub. L.
No. 65-254, §§ 250(b), 40 Stat. 1057, 1083 (applying fraud
penalty when an “understatement is false or fraudulent
with intent to evade the tax”); id. § 250(d), 40 Stat. at 1083
(applying exception to statute of limitations “in the case of
false or fraudulent returns with intent to evade the tax”).
Murrin’s argument implicates the statutory canon
of construction of in pari materia—the axiom that “a
legislative body generally uses a particular word with
a consistent meaning in a given context.” Erlenbaugh
v. United States, 409 U.S. 239, 243, 93 S. Ct. 477, 34 L.
Ed. 2d 446 (1972). But identical words “may be variously
construed, not only when they occur in different statutes,
but when used more than once in the same statute or even
in the same section.” Env’t Def. v. Duke Energy Corp., 549
U.S. 561, 574, 127 S. Ct. 1423, 167 L. Ed. 2d 295 (2007)
34a
Appendix B
(quoting Atl. Cleaners & Dyers, Inc. v. United States,
286 U.S. 427, 433, 52 S. Ct. 607, 76 L. Ed. 1204 (1932)).
“Thus, the ‘natural presumption that identical words used
in different parts of the same act are intended to have the
same meaning’” is not inexorable, and it “readily yields
whenever there is such variation in the connection in
which the words are used as reasonably to warrant the
conclusion that they were employed in different parts of
the act with different intent.’” Id. (quoting Atl. Cleaners
& Dyers, Inc., 286 U.S. at 433).
Looking past the fact that the modern-day fraud
penalty differs in text from the historical analogue,
Murrin points to the Revenue Act of 1918, which includes
the same contextual limitations present in the Code today.
Section 250(b), housing the fraud penalty now codified
as § 6663(a), included various limitations that referenced
taxpayers, their actions, and intent, but § 250(d), housing
the statute-of-limitations exception now codified as
§ 6501(c)(1), did not. See Revenue Act of 1918, Pub. L. No.
65-254, § 250(b), 40 Stat. 1057, 1083 (exempting application
of fraud penalty “if the return is made in good faith and
the understatement of the amount in the return is not due
to any fault of the taxpayer” or imposing a smaller penalty
for understatements “due to negligence on the part of the
taxpayer, but without intent to defraud”). Thus, Murrin’s
emphasis on history only proves the same point reached
by reference to the Code. Congress has never limited the
scope of the statute-of-limitations exception despite doing
so in the fraud penalty.9
9. Murrin makes the same argument related to § 7454(a), which
shifts the burden of proof to the IRS when it alleges “the petitioner
[that is, the taxpayer] has been guilty of fraud with intent to evade
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Appendix B
Second, Murrin points to another provision, § 6161(b)(3),
as support for why our interpretation is incongruous with
the Code. That provision disallows extensions of time for
payments of tax when a “deficiency is due to negligence,
to intentional disregard of rules and regulations, or to
fraud with intent to evade tax.” I.R.C. § 6161(b)(3). Section
6161(b)(3) is drafted like § 6501(c)(1), meaning nothing in
§ 6161(b)(3) suggests any limitation to its application when
a third party intends to evade tax. Murrin argues that
it is absurd to think that Congress would allow a third
party to impact a taxpayer’s ability to seek an extension
of time, further establishing the unreasonableness of our
interpretation of § 6501(c)(1).
We disagree with Murrin. Section 6161(b)(3) establishes
yet another piece of evidence supporting our interpretation
of § 6501(c)(1) and the Code. Sections 6161(b)(3) and 6501
(c)(1) deal with the IRS’s receipt of accurate payments of
tax, and their provisions are not limited to a taxpayer’s
intent. Sections 6663(c), 6664(c)(1), and 7454(a) deal with
the imposition of fraud penalties on top of what taxes might
be owed, and those provisions are limited to a taxpayer’s
intent. Read together, Congress treats the payments of
tax and the imposition of penalties differently. And it
makes sense that Congress would “impose penalties on
the taxpayer only when the taxpayer intended to evade
the tax, while at the same time allowing the IRS to collect
taxes based on an understated fraudulent return at any
tax.” Murrin suggests any case involving an intent to evade tax
relates to a taxpayer. But § 7454(a) is yet another example of how
Congress meant what it said and said what it meant; were § 6501
(c)(1) limited to a taxpayer’s intent to evade tax, it could have drafted
it precisely like § 7454(a) by specifying to whom the statute applies.
36a
Appendix B
time.” BASR, 795 F.3d at 1360 (Prost, C.J., dissenting);
see also Asphalt Indus., Inc. v. Comm’r, 384 F.2d 229, 234
(3d Cir. 1967) (explaining that the fraud penalty under
§ 6663(a) not only gathers revenue but also operates as a
“civil sanction” that “bears a close resemblance to criminal
liability”).
C.
Precedent Likewise Supports Our View
Finally, we examine the relevant precedent. The
Supreme Court’s recent analysis of Congress’s use of
passive voice also confirms our reading of § 6501(c)(1). In
Bartenwerfer, the Supreme Court analyzed a provision of
the Bankruptcy Code, 11 U.S.C. § 523(a)(2)(A), specifying
that debt is not dischargeable when money is “obtained
by . . . fraud.” 598 U.S. at 74. Because Bartenwerfer did
not know about the fraud committed by her partner,
she argued that the judgment was dischargeable in
bankruptcy. Id. at 75. Bartenwerfer reasoned that “the
statute is most naturally read to bar the discharge of debts
for money obtained by the debtor’s fraud,” as the passive
voice of the statute “hides the relevant actor in plain sight.”
Id. The Supreme Court unanimously disagreed because
the statute’s “[p]assive voice pull[ed] the actor off the
stage,” meaning that all the Bankruptcy Code required
was that “debt must result from someone’s fraud.” Id. at
75-76.
Section 6501(c)(1)’s “intent to evade tax” language
is like the “obtained by fraud” language at issue in
Bartenwerfer. Neither identifies who must intend to evade
tax or who must obtain property by fraud. But like the
language in Bartenwerfer, § 6501(c)(1) focuses on an event
37a
Appendix B
without regard to an actor—that is, Congress focused on
a “false or fraudulent return with the intent to evade tax”
without saying who must act. By pulling the taxpayer off
the stage, Congress made its reasoning clear. The statute
of limitations does not apply when someone intends to
evade tax in the filing of a false or fraudulent return,
taxpayer or not.10
Bartenwerfer’s analysis about the use of passive
voice in statutes also aligns with the Supreme Court’s
last opinion interpreting § 6501(c)(1). See Badaracco v.
Comm’r, 464 U.S. 386, 104 S. Ct. 756, 78 L. Ed. 2d 549
(1984). Badaracco concerned a dispute about whether the
statute of limitations is suspended under § 6501(c)(1) if an
amended non-fraudulent tax return is filed to correct a
previously filed fraudulent one. Id. at 388. Because § 6501
(c)(1) allows a tax assessment “at any time,” the Supreme
Court held that nothing in the statute’s “unqualified
language” could “be construed to suspend its operation
in the light of a fraudulent filer’s subsequent repentant
conduct.” Id. at 393. And the Supreme Court explained
that a statute of limitations like § 6501(c)(1) “must receive
10. The Supreme Court also discussed common law fraud
because while Bartenwerfer “paint[ed] a picture of liability imposed
willy-nilly on hapless bystanders,” common law fraud principles
establish that “innocent people are sometimes held liable for fraud
they did not personally commit.” Bartenwerfer, 598 U.S. at 82-83.
Murrin argues this fact makes Bartenwerfer inapposite because
“tax-return preparers are not agents” and, thus, common law fraud’s
application to this case would differ. Loving v. IRS, 742 F.3d 1013,
1017, 408 U.S. App. D.C. 281 (D.C. Cir. 2014). But even were that
true, Bartenwerfer’s more general view that a passive-voice phrase,
“on its face,” “pulls the actor off the stage” would remain. 598 U.S.
at 75. So too would our view of § 6501(c)(1).
38a
Appendix B
a strict construction in favor of the Government.” Id. at
391 (quoting E.I. Dupont de Nemours & Co. v. Davis, 264
U.S. 456, 462, 44 S. Ct. 364, 68 L. Ed. 788 (1924)).11 The
taxpayers’ position in Badaracco was similar to Murrin’s,
who advocates for a position unsupported by the statute’s
generally applicable language—language that we must
read in the IRS’s favor. Thus, we see nothing in the text
of § 6501(c)(1) or in case law from the Supreme Court
supporting Murrin’s preferred interpretation; instead, we
see case law supporting the opposite conclusion.
Moving past Badaracco and Bartenwerfer, Murrin
responds that we are bound to adopt her interpretation
because of this Court’s holding in Asphalt Industries, 384
F.2d at 229. But Murrin misreads Asphalt. The president of
Asphalt embezzled money and thus caused the corporation
to file false or fraudulent tax returns. Id. at 231. We held
that the president’s embezzlement was not imputed to the
corporation for purposes of § 6501(c)(1) in part because
the tax fraud was simply a “subordinate element in [the
president’s] need to conceal his embezzlement.” Id. at
235. We did not consider whether a party other than the
taxpayer could independently satisfy § 6501(c)(1). And no
one argued that the president’s embezzlement constituted
11. Murrin suggests that this Court does not construe statutes
of limitations in the IRS’s favor when the taxpayer does not act
fraudulently. Opening Br. 46 (citing Lauckner v. United States, 68
F.3d 69 (3d Cir. 1995)). We said no such thing in Lauckner, and the
next year interpreted § 6501 with reference to the Supreme Court’s
direction in Badaracco to strictly construe it in a light favorable
to the IRS. Bachner v. Comm’r, 81 F.3d 1274, 1279 (3d Cir. 1996).
And regardless, strict construction or not, Murrin’s argument runs
counter to § 6501(c)(1)’s text and context.
39a
Appendix B
an intent to evade tax owed by Asphalt. Instead, we
assumed “for present purposes” that “the meaning of
fraud” is the same under both § 6501(c)(1) and § 6663(a)
and held that the record was insufficient for § 6501(c)(1)
to apply. Id. at 232. Thus, Asphalt does not answer the
interpretive question before the Court today.
Murrin argues that affirming the Tax Court would
“reject[] 100 years of tax jurisprudence,” but that is not
so. Opening Br. 2. As Murrin explains, it appears that
the IRS first opined that § 6501(c)(1) applies in situations
other than where a taxpayer intended to evade tax in 2001.
IRS Field Service Advisory 200126019, 2001 WL 729653
(issued June 29, 2001). The Tax Court then held that
§ 6501(c)(1) applied in situations beyond when a taxpayer
intends to evade tax. See Allen v. Comm’r, 128 T.C. 37
(2007) (applying § 6501(c)(1) because of a tax preparer’s
intent to evade tax). Following Allen, the Tax Court has
applied § 6501(c)(1) in the context of a non-taxpayer’s intent
on several occasions, including on returns prepared by the
same tax preparer Murrin used. See Finnegan v. Comm’r,
T.C.M. (RIA) 2016-118, at *7-9 (2016) (finding Howell’s
intent to evade tax rendered § 6501(c)(1) applicable); see
also Ames-Mechelke v. Comm’r, 106 T.C.M. (CCH) 77,
at *7 (2013) (finding § 6501(c)(1) applied because of a tax
preparer). Our holding today therefore does not reject a
century’s worth of tax jurisprudence; instead, we continue
the well-trod ground laid by the Tax Court.
We do acknowledge, however, that our holding today
departs from the Federal Circuit’s opinion that the IRS
is limited “to the three-year limitations period unless the
taxpayer possessed the intent to evade tax.” BASR, 795
40a
Appendix B
F.3d at 1350 (majority opinion).12 The Federal Circuit, in a
decision predating Bartenwerfer, reached this conclusion
because it found the statute’s text revealed little and
instead relied heavily on context, congressional intent,
and legislative history. See, e.g., id. at 1343-45. Because we
find that § 6501(c)(1)’s text and statutory context include
no requirement that an “intent to evade tax” must come
from a taxpayer, we respectfully part ways. Accord id. at
1358 (Prost, C.J., dissenting) (“[T]he obvious construction
of the statutory text is that the intent to evade tax must
be present in a false or fraudulent return, irrespective of
who possesses that intent.”).
12. Murrin contends that the Fifth Circuit in Payne v. Comm’r,
224 F.3d 415 (5th Cir. 2000), came to the same view as the Federal
Circuit. The Fifth Circuit, in an appeal about whether the Tax
Court properly found that a taxpayer intended to evade tax under
§ 6501(c)(1), described how the IRS had to show evidence “from
which fraudulent intent on the part of the taxpayer can be properly
inferred.” Id. at 421 (emphasis omitted). The Fifth Circuit described
the case in those terms because the actor at issue was the taxpayer.
But nowhere did that court discern the meaning and scope of § 6501
(c)(1) for a third party’s actions.
The only other Circuit that confronted this issue aligns with our
view. City Wide Transit, Inc. v. Comm’r, 709 F.3d 102 (2d Cir. 2013).
The Second Circuit, citing the Tax Court’s post-Allen precedent,
stated: “we conclude that the limitations period for assessing [the
taxpayer’s] taxes is extended if the taxes were understated due
to fraud of the preparer.” Id. at 107. But the Second Circuit then
explained how the issue before it was a “narrow” one because
the taxpayer conceded that if the tax preparer filed taxes with an
intent to evade, § 6501(c)(1) applied. As a result, while City Wide
Transit appears to bolster our view, we are uncertain whether the
Second Circuit’s statement concerning § 6501(c)(1) is cabined to the
taxpayers’ concessions on appeal and, thus, do not rely on it.
41a
Appendix B
*****
Murrin faces financial pain. Murrin owes $65,318
in underpayments of tax, $13,064 in accuracy-related
penalties, and an estimated $250,000 in interest.13 All
date to tax returns from decades ago. Murrin finds this
patently unfair because her tax preparer caused the
underpayments of tax. We understand her perspective.
But we are bound to “consider . . . whether the policy
[Murrin] favor[s] is that which Congress effectuated by
its enactment of § 6501.” Badaracco, 464 U.S. at 398.
And while Congress has limited imposing fraud penalties
against a taxpayer without a taxpayer’s intent, § 6501(c)(1)’s
text, context, and precedent establish that Congress was
agnostic about whether the taxpayer intended to evade
tax for purposes of the IRS’s full and accurate assessment
of taxes.
IV. CONCLUSION
For the reasons discussed above, we will affirm the
judgment of the Tax Court.
13. We emphasize that Murrin’s accuracy-related penalties
and interest on the deficiencies are not before us because Murrin
stipulated to the IRS’s proper determination of both. But in the
proper case, even if the statute-of-limitations exception in § 6501(c)(1)
aapplies, taxpayers are free to challenge accuracy-related penalties
and interest. See, e.g., I.R.C. § 6664(c)(1) (rendering the accuracyrelated penalty and fraud penalty inapplicable when the taxpayer had
a “reasonable cause” for the tax position and “acted in good faith”).
42a
C
APPENDIX C — Appendix
MEMORANDUM
OPINION
OF THE UNITED STATES TAX COURT,
FILED JANUARY 24, 2024
UNITED STATES TAX COURT
T.C. Memo. 2024-10
STEPHANIE MURRIN,
Petitioner,
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent.
Docket No. 14614-19.
Filed January 24, 2024.
MEMORANDUM OPINION
URDA, Judge: The Internal Revenue Service (IRS)
generally has three years from the filing of a federal
income tax return to assess tax. This temporal limit
disappears, however, when the IRS is faced with “a false
or fraudulent return with the intent to evade tax.” I.R.C.
§ 6501(c).1 In 2019 the IRS issued a notice of deficiency to
petitioner, Stephanie Murrin, with respect to returns she
1. Unless otherwise indicated, statutory references are to
the Internal Revenue Code, Title 26 U.S.C. (I.R.C. or Code), in
effect at all relevant times, and Rule references are to the Tax
Court Rules of Practice and Procedure. We round all monetary
values to the nearest dollar.
43a
Appendix C
and her then husband had filed, many years earlier, for
their 1993–99 tax years. Although the Murrins did not
intend to evade tax, their tax return preparer did, and,
to that end, he put false or fraudulent information on the
Murrins’ returns.
The sole question before the Court is the same one
we decided in Allen v. Commissioner, 128 T.C. 37 (2007):
whether section 6501(c) applies only where a taxpayer
herself has filed a false or fraudulent return with the intent
to evade tax. The Code contains no such limitation, and
we will adhere to our precedent.
Background
The parties submitted this case for decision without
trial under Rule 122 and have stipulated all material facts.
Ms. Murrin lived in New Jersey when she timely filed her
petition.
For tax years 1993 through 1999 (the years at issue),
the Murrins relied on a tax return preparer, Duane Howell,
to prepare their joint federal income tax returns, as well as
returns for two partnerships in which Ms. Murrin was a
general partner. Unbeknownst to the Murrins, Mr. Howell
placed false or fraudulent entries on those returns with
the intent to evade tax. The Murrins themselves did not
put any false or fraudulent information on their returns,
nor did they intend to evade tax.
The Murrins timely filed their 1993–99 tax returns.
The IRS did not discover Mr. Howell’s fraudulent entries
44a
Appendix C
until well after the expiration of the three-year period of
limitations to assess tax set forth in section 6501(a). In
2019 the IRS nonetheless issued a notice of deficiency to
the Murrins for the years at issue, premised on the fraud
exception to the three-year limitation embodied in section
6501(c). The notice determined deficiencies and accuracyrelated penalties under section 6662 against the Murrins
for all of the years in issue.
Discussion
I.
Burden of Proof
The parties submitted this case for decision without
trial under Rule 122(a). The fact that a case has been
submitted under Rule 122(a) “does not alter the burden
of proof, or the requirements otherwise applicable with
respect to adducing proof, or the effect of failure of proof.”
Rule 122(b).
In this case the Commissioner bears the burden of
proof under Rule 142(b), which places the burden on him
“[i]n any case involving the issue of fraud with intent to
evade tax.” The placement of the burden has no practical
effect here, however. The parties have stipulated that Mr.
Howell committed fraud with the intent to evade tax, and
our resolution thus turns not on the proof before us but
on the scope of section 6501(c).
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Appendix C
II. Limitation on Assessment
A.
Introduction
Section 6501(a) generally provides that “the amount
of any tax imposed by this title shall be assessed within
3 years after the return was filed.” Section 6501(c) lays
out several exceptions to this general limitation, including
“[i]n the case of a false or fraudulent return with the intent
to evade tax.” I.R.C. § 6501(c)(1). In that instance “the tax
may be assessed . . . at any time.” Id. We have previously
held in a precedential opinion that the section 6501(c)(1)
exception to the statute of limitation encompasses the case
where a tax return preparer prepares a false or fraudulent
return with the intent to evade tax. Allen, 128 T.C. at 42;
see also Finnegan v. Commissioner, T.C. Memo. 2016-118,
aff’d, 926 F.3d 1261 (11th Cir. 2019); 2 Ames-Mechelke v.
Commissioner, T.C. Memo. 2013-176, at *14; Eriksen v.
Commissioner, T.C. Memo. 2012- 194, 2012 WL 2865875,
at *7; Browning v. Commissioner, T.C. Memo. 2011-261,
2011 WL 5289636, at *13 n.14; cf. City Wide Transit, Inc.
v. Commissioner, 709 F.3d 102, 107–08 (2d Cir. 2013), rev’g
on other grounds T.C. Memo. 2011-279, 2011 WL 5884981.
Ms. Murrin argues that Allen was wrongly decided
and asks us to reconsider our decision and hold in the
alternative that section 6501(c) encompasses solely
2. The U.S. Court of Appeals for the Eleventh Circuit decided
that appellants in Finnegan had waived their challenge to Allen
and declined to exercise its discretion to consider that argument.
Finnegan v. Commissioner, 926 F.3d at 1270.
46a
Appendix C
taxpayer fraud. As an initial matter, the doctrine of stare
decisis counsels us to “follow the holding of a previously
decided case, absent special justification.” Sec. State
Bank v. Commissioner, 111 T.C. 210, 213 (1998), aff’d,
214 F.3d 1254 (10th Cir. 2000). Stare decisis “promotes
the evenhanded, predictable, and consistent development
of legal principles, fosters reliance on judicial decisions,
and contributes to the actual and perceived integrity of
the judicial process.” Hesselink v. Commissioner, 97 T.C.
94, 99 (1991) (quoting Payne v. Tennessee, 501 U.S. 808,
827 (1991)).
In cases of statutory construction, stare decisis has
“‘special force,’ for ‘Congress remains free to alter what
[courts] have done.’” John R. Sand & Gravel Co. v. United
States, 552 U.S. 130, 139 (2008) (quoting Patterson v.
McLean Credit Union, 491 U.S. 164, 172–73 (1989)).
This generally obviates our need to revisit or repeat the
statutory analysis that led us to a prior decision, absent
special justification. See Midland Fin. Co. & Subs. v.
Commissioner, T.C. Memo. 2001-203, 2001 WL 868626,
at *3.
Ms. Murrin counters that this case features the type
of special justification that supports revisiting precedent,
namely a decision of the U.S. Court of Appeals for the
Federal Circuit disagreeing with our holding in Allen.
See BASR P’ship v. United States, 795 F.3d 1338, 1342
(Fed. Cir. 2015). We have previously declined to revisit our
precedent in light of the Federal Circuit’s opinion, noting
that each of the judges on the panel wrote separately and
that “it is unclear . . . which interpretation of sect[ion]
6501(c)(1) would prevail.” Finnegan, T.C. Memo. 2016-
47a
Appendix C
118, at *18 n.6. Laying out the scorecard: (1) the author
of the majority opinion concluded that section 6501(c)(1)
“suspends the three-year limitations period only when the
IRS establishes that the taxpayer acted with the intent
to evade tax,” BASR, 795 F.3d at 1342; (2) the author of
the concurring opinion reasoned that “it is the taxpayer
(or possibly his authorized agent) who must have the
requisite ‘intent to evade tax,’” id. at 1351 (O’Malley, J.,
concurring); and (3) the author of the dissenting opinion
agreed with our holding in Allen, id. at 1357–61 (Prost,
C.J., dissenting).
The Federal Circuit’s position on the precise point
before us is not clear. We further note that “there is no
jurisdiction for appeal of any decision of the Tax Court
to the [Federal Circuit]” in any event. Finnegan, T.C.
Memo. 2016-118, at *18 n.6; see I.R.C. § 7482(a)(1). Stare
decisis principles thus would seem to weigh against our
reconsideration of our precedent in light of BASR. 3
B. Analysis
Even if we were to conclude that stare decisis weighed
in favor of reconsideration of Allen, we would reach the
same result. As an initial matter, “limitations statutes
3. Ms. Murrin suggests on reply that the Commissioner
bears the burden of persuading the Court that Allen should
be followed. To the contrary, “every successful proponent of
overruling precedent has borne the heavy burden of persuading
the Court that changes in society or in the law dictate that the
values served by stare decisis yield in favor of a greater objective.”
Vasquez v. Hillery, 474 U.S. 254, 266 (1986); AHG Invs., LLC v.
Commissioner, 140 T.C. 73, 83 (2013).
48a
Appendix C
barring the collection of taxes otherwise due and unpaid
are strictly construed in favor of the Government.”
Badaracco v. Commissioner, 464 U.S. 386, 392 (1984)
(quoting Lucia v. United States, 474 F.2d 565, 570 (5th
Cir. 1973)) (addressing I.R.C. § 6501(c)(1)).4 “Our task is to
give effect to the will of Congress, and where Congress’s
will has been expressed in language that has a reasonably
plain meaning, that language must ordinarily be regarded
as conclusive.” Byrd v. Shannon, 715 F.3d 117, 122 (3d Cir.
2013); see also United States v. Ron Pair Enters., Inc.,
489 U.S. 235, 241 (1989). “The plainness or ambiguity
of statutory language is determined by reference to the
language itself, the specific context in which that language
is used, and the broader context of the statute as a whole.”
Robinson v. Shell Oil Co., 519 U.S. 337, 341 (1997). We will
discuss each aspect in turn.
4. Ms. Murrin argues that the presumption of strict
construction of collection limitation statutes should be limited to
cases in which the taxpayer committed fraud, as was the case in
Badaracco. The cases cited in Badaracco make clear that this
presumption comes from “the established general rule [that] a
statute of limitation runs against the United States only when
they assent and upon the conditions prescribed.” Lucas v. Pilliod
Lumber Co., 281 U.S. 245, 249 (1930) (emphasis added); see also E. I.
Du Pont de Nemours & Co. v. Davis, 264 U.S. 456, 462 (1924) (“[A]n
action on behalf of the United States in its governmental capacity
. . . is subject to no time limitation, in the absence of congressional
enactment clearly imposing it.” (Emphasis added.)). The identity
of the perpetrator of the fraud thus is irrelevant for the operation
of the presumption. We likewise reject Ms. Murrin’s assertion that
this presumption does not operate in the context of an exception
to a statute of limitation as the Supreme Court in Badaracco was
interpreting section 6501(c)(1), the same provision at issue here.
49a
Appendix C
1.
Section 6501(c)(1)
Our analysis begins, as always, with the text of the
relevant statutory provision. Ross v. Blake, 578 U.S. 632,
638 (2016); see also Doe I v. Scalia, 58 F.4th 708, 715
(3d Cir. 2023); Lawrence v. City of Phila., 527 F.3d 299,
316–17 (3d Cir. 2008). Section 6501(c)(1) provides that “[i]n
the case of a false or fraudulent return with the intent
to evade tax, the tax may be assessed, or a proceeding
in court for collection of such tax may be begun without
assessment, at any time.”
By its own terms, this provision does not restrict its
application to cases where taxpayers personally had the
intent to evade tax. See Allen, 128 T.C. at 40 (“Nothing in
the plain meaning of the statute suggests the limitations
period is extended only in the case of the taxpayer’s
fraud.”). Instead, Congress showed itself agnostic as to
who had to have the intent to evade tax, choosing to “key[]
the extension [of the limitation period] to the fraudulent
nature of the return” rather than tie it to the taxpayer’s
intent. Id. “[T]he obvious construction of the statutory text
is that the intent to evade tax must be present in a false
or fraudulent return, irrespective of who possesses that
intent.” BASR, 795 F.3d at 1359 (Prost, C.J., dissenting).
The Supreme Court recently endorsed a similar
interpretative path in the context of a Bankruptcy
Code provision that featured an “actor off the stage.”
Bartenwerfer v. Buckley, 598 U.S. 69, 75 (2023). In that
case, Congress wrote the relevant provision in the passive
voice and thus, as here, did not specify a particular
50a
Appendix C
actor. Id. at 74–76. The Supreme Court explained that
Congress had “framed [the provision at issue] to ‘focu[s]
on an event that occurs without respect to a specific actor,
and therefore without respect to any actor’s intent or
culpability.’” Id. at 75–76 (quoting Dean v. United States,
556 U.S. 568, 572 (2009)). Section 6501(c)(1), which focuses
on the return and not the intent of a particular actor,
compels the same result here.
Ms. Murrin responds with a textual argument of her
own. Noting that the text identifies the tax and return at
issue as belonging to the taxpayer, she contends that the
intent to evade must also come from the taxpayer. This
conclusion does not follow. The specification of whose tax
or return is at issue does not suggest, much less dictate,
who had to intend to evade tax. Cf. BASR, 795 F.3d at
1343 n.4 (rejecting the argument that the definition of
return “renders the meaning of § 6501(c)(1) clear and
unambiguous”).
In summary, section 6501(c)(1) applies “[i]n the case of
a false or fraudulent return with the intent to evade tax,”
with no additional qualification. The provision contains
no requirement that the intent to evade belong to the
taxpayer, see Bartenwerfer, 598 U.S. at 75–76, and we
will not import a restriction that Congress saw fit not to
impose, see, e.g., Conn. Nat’l Bank v. Germain, 503 U.S.
249, 253–54 (1992).
2.
Broader Statutory Context
Nor does the broader statutory context compel a
different interpretation. Like the Federal Circuit, Ms.
51a
Appendix C
Murrin argues that certain other Code provisions related
to fraud (sections 6663, 7454(a), and 6161(b)(3)) weigh in
favor of attaching a taxpayer-specific limitation to the
intent requirement of section 6501(c)(1). We disagree.
These Code provisions “reveal[] only that Congress
knows how to explicitly limit the intent to evade tax
to the taxpayer,” BASR, 795 F.3d at 1359 (Prost, C.J.,
dissenting), and chose not to do so here.
a.
Section 6663
We first consider section 6663(a), which imposes a
penalty “[i]f any part of any underpayment of tax required
to be shown on a return is due to fraud.” That provision,
like section 6501(c)(1), has its roots in the Revenue Act
of 1918, ch. 18, 40 Stat. 1057, and contains no reference
to the taxpayer. Ms. Murrin points out that the penalty
nonetheless has been interpreted to encompass only fraud
attributable to a particular taxpayer and concludes that
a similar limitation should obtain here.
Section 6663(a) itself must be understood in the proper
context, which demonstrates that it applies to a specific,
culpable taxpayer. From its introduction in 1918, this
penalty has been accompanied by a reasonable cause and
good faith exception currently embodied in section 6664
(c)(1), which provides that “[n]o penalty shall be imposed
under section . . . 6663 . . . if it is shown that there was a
reasonable cause . . . and that the taxpayer acted in good
faith.” (Emphasis added.) Evidence that the fraud penalty
applies exclusively to taxpayer fraud is furthered by
section 6663(c), which limits the penalty in cases of joint
returns to those who actually committed fraud. Although
52a
Appendix C
section 6663(a) does not explicitly speak in taxpayerspecific terms, the statutory context elucidates that the
penalty applies only to a particular taxpayer. Similar
context fails to suggest that the exception to the statute
of limitation in section 6501(c)(1) must be similarly limited.
This point is brought into starker relief when
considering the history of these provisions. Section 250(b)
of the Revenue Act of 1918, 40 Stat. at 1083, which housed
the original version of the section 6663(a) fraud penalty,
provides:
If the amount already paid is less than that
which should have been paid, the difference
shall . . . be paid upon notice and demand . . . .
In such case if the return is made in good faith
and the understatement of the amount in the
return is not due to any fault of the taxpayer,
there shall be no penalty because of such
understatement. If the understatement is due
to negligence on the part of the taxpayer, but
without intent to defraud, there shall be added
as part of the tax 5 per centum of the total
amount of the deficiency . . . .
If the understatement is false or fraudulent
with intent to evade the tax, then . . . there shall
be added as part of the tax 50 per centum of the
amount of the deficiency.
(Emphasis added.) Although the fraud penalty portion
of that section did not speak in terms of the culpability
53a
Appendix C
of a particular taxpayer, it did not need to: the provision
as a whole made clear that the penalties and exceptions
described therein applied to a particular taxpayer.
Section 250(d) of the Revenue Act of 1918, 40 Stat.
at 1083, which embodied the first incarnation of section
6501(c)(1), contains no similar markers. Worded almost
identically to the current version, it simply provides that
“[e]xcept in the case of false or fraudulent returns with
intent to evade the tax, the amount of tax due under
any return shall be determined and assessed by the
Commissioner within five years.” Thus, nothing in the text
of section 250(d) offers support for adding the requirement
pellucid in section 250(b). 5
Ms. Murrin suggests that these provisions, which were
originally two houses down from each other in the Revenue
Act of 1918, should be read in pari materia considering
their placement and the common subject matter of
fraud. “The Supreme Court has recognized, however,
that identical terms or phrases used in the Code need
not be interpreted to have the same meaning where the
sections in which they are found serve different legislative
purposes.” Yarish v. Commissioner, 139 T.C. 290, 297
(2012) (citing Don E. Williams Co. v. Commissioner, 429
U.S. 569, 580–82 (1977)); see also 2B Norman J. Singer &
5. The parties joust over the meaning of a failed 1934
amendment, and a senator’s description of that amendment in
passing. We attach no weight to their discussion given the plain
text and the established history of this provision. Cent. Bank of
Denver, N.A. v. First Interstate Bank of Denver, N.A., 511 U.S.
164, 187 (1994).
54a
Appendix C
J.D. Shambie Singer, Sutherland Statutory Construction
§ 51:3, at 222–28 (7th ed. 2012) (“Characterization of the
object or purpose is more important than characterization
of the subject matter to determine whether different
statutes are closely enough related to justify interpreting
one in light of the other.”). Although both section 6501
(c)(1) and section 6663 deal with fraud, their purposes are
vastly different and account for the different treatment.
The purpose of the former is to provide unlimited time
to the Commissioner to assess the correct tax liability in
the case of a false or fraudulent return “because of the
special disadvantage to the Commissioner in investigating
these types of returns.” Allen, 128 T.C. at 40; see also
Badaracco v. Commissioner, 464 U.S. at 398; BASR,
795 F.3d at 1361 (Prost, C.J., dissenting); City Wide
Transit, Inc. v. Commissioner, 709 F.3d at 107; Ballard
v. Commissioner, 740 F.2d 659, 663 (8th Cir. 1984) (“The
lifting of the normal statute of limitations addresses the
difficulties which sometimes arise in the discovery of
deficiencies by virtue of taxpayer fraud . . . .”), aff’g in part,
rev’g in part T.C. Memo. 1982-466. Fraud—by whoever
committed—places the tax collector in a “disadvantageous
position” vis-à-vis the determination of a taxpayer’s
correct tax liability. Badaracco v. Commissioner, 464
U.S. at 398. “[F]raud cases ordinarily are more difficult
to investigate than cases marked for routine tax audits.
Where fraud has been practiced, there is a distinct
possibility that the taxpayer’s underlying records will
have been falsified or even destroyed.” Id. “Thus, the
lack of a statute of limitations for fraudulent returns
with intent to evade tax in § 6501(c)(1) (and § 250(d))
reasonably compensates the government for the unique
55a
Appendix C
difficulty involved in discovering fraud and determining
the taxpayer’s true tax liability.” BASR, 795 F.3d at 1361
(Prost, C.J. dissenting).
Section 6663(a) serves a markedly different purpose,
which is tied to the culpability of a particular taxpayer.
“The fraud penalty is a civil sanction provided primarily
as a safeguard for the protection of the revenue and to
reimburse the Government for the heavy expense of
investigation and the loss resulting from a taxpayer’s
fraud.” Bell Cap. Mgmt., Inc. v. Commissioner, T.C.
Memo. 2021-74, at *18; see Helvering v. Mitchell, 303 U.S.
391, 401 (1938); cf. Asphalt Indus., Inc. v. Commissioner,
384 F.2d 229, 234–35 (3d Cir. 1967) (explaining that
Congress intends section 6663(a) “to punish and deter
wrongful conduct”), rev’g 46 T.C. 622 (1966). “Given that
the taxpayer must pay any tax penalty, Congress may
reasonably only intend to penalize the taxpayer when the
taxpayer is culpable.” BASR, 795 F.3d at 1360–61 (Prost,
C.J. dissenting).
The broader statutory context reflects these divergent
purposes, showing that the exception is tied to a false or
fraudulent return with the intent to evade, not a particular
person, while the penalty is taxpayer specific. The two
statutes are not in pari materia, and the fraud penalty
does not inform the reading of the exception.
b.
Section 7454(a)
We are similarly unpersuaded by Ms. Murrin’s
contention that section 7454(a) justifies restricting section
6501(c)(1) to cases where taxpayers themselves intended
56a
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to evade tax. Section 7454(a) provides that “[i]n any
proceeding involving the issue whether the petitioner has
been guilty of fraud with intent to evade tax, the burden of
proof in respect of such issue shall be upon the Secretary.”
According to Ms. Murrin, section 7454(a) “indicates
that, when pursuing fraudulent conduct, Congress
considered the fraudulent intent of only the taxpayer, not
of a third party who advised or assisted the taxpayer.”
We draw a different conclusion. In section 7454(a)
Congress’s decision to explicitly limit the intent to evade
tax to a taxpayer’s own intent belies the notion that
such a limitation attaches to other sections of the Code
pertaining to fraudulent conduct or the intent to evade tax.
“Without such express limitation, the intent to evade tax
encompasses others who cause a return to be fraudulent.”
BASR, 795 F.3d at 1359 (Prost, C.J., dissenting).
The inclusion of this language carries another lesson.
“[W]here Congress includes particular language in one
section of a statute but omits it in another section of the
same Act, it is generally presumed that Congress acts
intentionally and purposely in the disparate inclusion
or exclusion.” Dean, 556 U.S. at 573 (quoting Russello
v. United States, 464 U.S. 16, 23 (1983)). Section 7454(a)
“demonstrates that Congress only limits the intent to evade
tax to the taxpayer’s intent in specific circumstances.”
BASR, 795 F.3d at 1359 (Prost, C.J., dissenting). It did not
do so here, and absent more, we must respect Congress’s
decision.
Following the lead of the majority in BASR, Ms.
Murrin attempts to save her argument by pointing to
57a
Appendix C
legislative history which states that “the [C]ommissioner
should be placed in the position of party plaintiff and
compelled to carry the burden of proving fraud whenever
it is an issue in the case.” S. Rep. No. 70-960, at 38 (1928),
as reprinted in 1939- 1 C.B. (Part 2) 409, 435–36; see also
BASR, 795 F.3d at 1344. According to Ms. Murrin, this
Senate report supports the conclusion that, “‘whenever
[fraud] is an issue in the case,’ it was fraud by the taxpayer,
not by anyone else, that Congress sought to police.” BASR,
795 F.3d at 1345.
“But legislative history is not the law.” Epic Sys.
Corp. v. Lewis, 584 U.S. 497, 523 (2018). And we do not
believe that resorting to legislative history is called for
here given the unambiguous nature of the text of sections
7454(a) and 6501(c)(1). See, e.g., Milner v. Dep’t of Navy,
562 U.S. 562, 572 (2011).
Even if we were to consider the Senate report, it does
not suggest that Congress thought that any reference to
fraud carries with it the implicit limitation to a specific
taxpayer. The legislative history shows that Congress
was responding to a particular problem seen in Board of
Tax Appeals cases where the “deficiency letter raises the
issue that the [taxpayer] has been guilty of fraud.” 1939-1
C.B. (Part 2) at 435. The legislative history observed that
“[p]roceedings before the [Board of Tax Appeals] involving
that issue in some respects resemble penal suits.” Id.
Congress responded to this specific problem by enacting
section 7454(a). “This concern does not apply if another’s
alleged intent to evade tax is at issue,” BASR, 795 F.3d at
1359 (Prost, C.J., dissenting), and the legislative history
58a
Appendix C
thus cannot carry the weight that Ms. Murrin seeks to
put on it.
c.
Section 6161(b)(3)
We find unconvincing Ms. Murrin’s argument that
interpreting section 6501(c)(1) to mean what it says would
undermine section 6161(b)(3). That provision prohibits the
IRS from granting an extension to pay a tax deficiency
when it is “due to negligence, to intentional disregard of
rules and regulations, or to fraud with intent to evade
tax.” I.R.C. § 6161(b)(3). Ms. Murrin points out that
unless “fraud with intent to evade tax” is restricted to
a taxpayer’s personal intent, “a taxpayer’s eligibility for
relief under section 6161(b) could be conditioned on the act
of some third party.” As we explained when interpreting
the same phrase in the context of section 6501(c)(1),
see supra Part II.B.1., we simply have no grounds for
reading in an additional, unstated restriction to qualify
the wording Congress adopted.
3.
Remaining Arguments
Ms. Murrin also asserts that the interpretation
adopted by this Court in Allen is inconsistent with several
decisions of this Court and other courts, which concluded
that section 6501(c)(1) did not apply to third parties who
were unrelated to the preparation and filing of the return.
See BASR, 795 F.3d at 1347 (“There are no allegations
that [the taxpayer], or even its accountant, knew or should
have known that the tax return was false or incorrect
. . . .”); Asphalt Indus., Inc., v. Commissioner, 384 F.2d at
59a
Appendix C
230; Botwinik Bros. of Mass., Inc. v. Commissioner, 39
T.C. 988, 990–91 (1963); see also City Wide Transit, Inc.
v. Commissioner, 709 F.3d at 108 (observing that the tax
return preparer who intended to evade taxes “was not
a third party unrelated to the preparation and filing of
the returns”). These cases are inapposite as they do not
address the applicability of section 6501(c)(1) to a person
who filed or prepared false or fraudulent returns with the
intent to evade tax, as did Mr. Howell, the Murrins’ tax
return preparer. 6
Our interpretation nonetheless accommodates the
results in each. Section 6501(c)(1) is triggered by (1) a
false or fraudulent return (2) with the intent to evade tax.
The combination of a return with the intent requirement
circumscribes the pool of actors whose intent might matter
to those who had a hand in the preparation or filing of a tax
return. I.R.C. § 6501(c)(1); accord BASR, 795 F.3d at 1343
(“A fraud is only committed via submission of a document
when a person acting with an intent to defraud makes a
false entry on that document.”). The decisions cited by Ms.
6. Ms. Murrin attempts to manufacture a conflict between
Allen and the opinion of the U.S. Court of Appeals for the D.C.
Circuit in Loving v. IRS, 742 F.3d 1013, 1017 (D.C. Cir. 2014),
suggesting that Allen conflicted with the D.C. Circuit’s observation
that “tax-return preparers are not agents.” The conclusion in
Allen, however, did not stem from agency principles, but from the
plain text of the Code, and in no way implicates the D.C. Circuit’s
opinion. We likewise reject Ms. Murrin’s reliance on United
States v. Boyle, 469 U.S. 241 (1985). The fact that a taxpayer has a
nondelegable duty to file a return does not support the conclusion
that a taxpayer must intend to evade tax for section 6501(c)(1) to
apply.
60a
Appendix C
Murrin each involved fraud perpetrated by third parties
distant from the filing and preparation of the return, and
thus section 6501(c)(1) did not apply. See BASR, 795 F.3d
at 1343; Asphalt Indus. v. Commissioner, 384 F.2d at 230;
Botwinik, 39 T.C. at 990–91.7
Finally, we are unpersuaded that the decision of the
U.S. Court of Appeals for the Fifth Circuit in Payne v.
Commissioner, 224 F.3d 415, 420–21 (5th Cir. 2000), rev’g
T.C. Memo. 1998-227, has any relevance here, much less
“[s]upports the [c]onclusion [t]hat [f]raudulent [i]ntent [i]s
[d]etermined by [r]eference to the [t]axpayer’s [i]ntent.” In
that case, the Fifth Circuit addressed whether evidence
introduced by the Commissioner in the Tax Court sufficed
to meet his burden of proof with respect to section 6501
(c)(1). Payne v. Commissioner, 224 F.3d at 421. Although
the Fifth Circuit’s analysis centered on the taxpayer
before it, the court did not suggest that only a taxpayer’s
intent to evade can trigger section 6501(c)(1), a question
plainly not before that court. 8
7. Each of our post-Allen decisions has similarly involved
the conduct and intent of the person or persons who actually
prepared the false or fraudulent returns at issue. See Finnegan,
T.C. Memo. 2016-118, at *17–27 (applying the fraud exception
in the case of tax-preparer fraud); Ames-Mechelke, T.C. Memo.
2013-176, at *19–21 (same); Eriksen v. Commissioner, 2012 WL
2865825, at *12 (same); City Wide Transit, Inc. v. Commissioner,
2011 WL 5884981, at *6 (same); Browning v. Commissioner, 2011
WL 5289636, at *16 (same).
8. In her reply brief, Ms. Murrin raises for the first time that
certain IRS Field Service Advice Memoranda interpreting section
6501(c)(1) violated the Administrative Procedure Act (APA). We
61a
Appendix C
III. Conclusion
We have concluded that no special justification exists
warranting our reversal of Allen. Mr. Howell’s preparation
of false or fraudulent returns with the intent to evade tax
is sufficient to trigger the indefinite period of limitation to
assess tax. The Commissioner’s deficiency determinations
are timely.
To reflect the foregoing,
Decision will be entered for respondent.
generally deem issues raised for the first time on reply as waived
or conceded. See, e.g., Levert v. Commissioner, T.C. Memo. 1989333, 57 T.C.M. (CCH) 910, 917–18 (deeming an issue conceded when
party did not raise it in his opening brief), aff’d without published
opinion, 956 F.2d 264 (5th Cir. 1992); cf. Thomas v. Roach, 165
F.3d 137, 145–46 (2d Cir. 1999) (holding argument first raised in
reply brief waived). Even if we were to consider this issue, Ms.
Murrin fails to show that such non-precedential Field Service
Advice Memoranda constitute rulemaking under the APA.
62a
Appendix D OF REHEARING/
APPENDIX D — GRANTING
DENIAL OF REHEARING EN BANC OF THE
UNITED STATES COURT OF APPEALS FOR THE
THIRD CIRCUIT, FILED OCTOBER 17, 2025
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 24-2037
STEPHANIE MURRIN,
Appellant,
v.
COMMISSIONER OF INTERNAL REVENUE
(U.S. Tax Court No. 19-14614)
SUR PETITION FOR REHEARING
Present: CHAGARES, Chief Judge, HARDIMAN,
SHWARTZ, KRAUSE, RESTREPO, BIBAS, PORTER,
MATEY, PHIPPS, FREEMAN, MONTGOMERYREEVES, CHUNG, and BOVE, Circuit Judges.
The petition for rehearing filed by Appellant in
the above-entitled case having been submitted to the
judges who participated in the decision of this Court, it
is hereby ORDERED that the petition for rehearing by
the panel is GRANTED. The Clerk is directed to file the
amended opinion contemporaneously with this order. As
the revisions do not affect the disposition of the appeal,
the judgment will remain as filed.
63a
Appendix D
A majority of the judges of the circuit in regular
service not having voted for rehearing, the petition for
rehearing by the Court en banc is DENIED.
BY THE COURT,
s/ Tamika R. Montgomery-Reeves
Circuit Judge
Dated: October 17, 2025
64a
Appendix E
APPENDIX E – STATUTORY PROVISIONS
26 U.S.C. § 6201 – Assessment authority
(a) Authority of Secretary
The Secretary is authorized and required to make
the inquiries, determinations, and assessments of all
taxes (including interest, additional amounts,
additions to the tax, and assessable penalties) imposed
by this title, or accruing under any former internal
revenue law, which have not been duly paid by stamp
at the time and in the manner provided by law.
26 U.S.C. § 6501 – Limitations on assessment and
collection
(a) General rule
Except as otherwise provided in this section, the
amount of any tax imposed by this title shall be
assessed within 3 years after the return was filed
(whether or not such return was filed on or after the
date prescribed) …, and no proceeding in court without
assessment for the collection of such tax shall be begun
after the expiration of such period. For purposes of
this chapter, the term “return” means the return
required to be filed by the taxpayer (and does not
include a return of any person from whom the
taxpayer has received an item of income, gain, loss,
deduction, or credit).
...
1
65a
Appendix E
(c) Exceptions
(1) False return
In the case of a false or fraudulent return with the
intent to evade tax, the tax may be assessed, or a
proceeding in court for collection of such tax may be
begun without assessment, at any time . . .
(e) Substantial omission of items
Except as otherwise provided in subsection (c)—
(1) Income taxes
In the case of any tax imposed by subtitle A—
(A) General rule
If the taxpayer omits from gross income an amount
properly includible therein and—
(i) such amount is in excess of 25 percent of the
amount of gross income stated in the return, or
(ii) such amount—
(I) is attributable to one or more assets with
respect to which information is required to be reported
under section 6038D (or would be so required if such
section were applied without regard to the dollar
threshold specified in subsection (a) thereof and
without regard to any exceptions provided pursuant to
subsection (h)(1) thereof), and
(II)is in excess of $5,000, the tax may be assessed,
or a proceeding in court for collection of such tax may
2
66a
Appendix E
be begun without assessment, at any time within 6
years after the return was filed.
26 U.S.C. § 6663 – Imposition of Fraud Penalty
(a) Imposition of penalty
If any part of any underpayment of tax required to
be shown on a return is due to fraud, there shall be
added to the tax an amount equal to 75 percent of the
portion of the underpayment which is attributable to
fraud.
(b) Determination of portion attributable to
fraud
If the Secretary establishes that any portion of an
underpayment is attributable to fraud, the entire
underpayment shall be treated as attributable to
fraud, except with respect to any portion of the
underpayment which the taxpayer establishes (by a
preponderance of the evidence) is not attributable to
fraud.
(c) Special rule for joint returns
In the case of a joint return, this section shall not
apply with respect to a spouse unless some part of the
underpayment is due to the fraud of such spouse.
3
67a
Appendix E
26 U.S.C. § 6694 – Understatement of taxpayer’s
liability by tax return preparer
(b)
UNDERSTATEMENT
DUE
TO
WILLFUL
OR
RECKLESS CONDUCT
(1)IN GENERAL
Any tax return preparer who prepares any return or
claim for refund with respect to which any part of
an understatement of liability is due to a conduct
described in paragraph (2) shall pay a penalty with
respect to each such return or claim in an amount
equal to the greater of—
(A) $5,000, or
(B) 75 percent of the income derived (or to be
derived) by the tax return preparer with respect to
the return or claim.
(2) WILLFUL OR RECKLESS CONDUCT
Conduct described in this paragraph is conduct by
the tax return preparer which is—
(A) a willful attempt in any manner to understate
the liability for tax on the return or claim, or
(B) a reckless or intentional disregard of rules or
regulations.
(3)REDUCTION IN PENALTY
The amount of any
any person by reason of
4
penalty payable
this subsection
by
for
68a
Appendix E
any return or claim for refund shall be reduced by the
amount of the penalty paid by such person by reason
of subsection (a).
26 U.S.C. § 6701 – Penalties for aiding and
abetting understatement of tax liability
(A) IMPOSITION OF PENALTY
Any person—
(1) who aids or assists in, procures, or advises with
respect to, the preparation or presentation of any
portion of a return, affidavit, claim, or other document,
(2) who knows (or has reason to believe) that such
portion will be used in connection with any material
matter arising under the internal revenue laws, and
(3) who knows that such portion (if so used) would
result in an understatement of the liability for tax of
another person, shall pay a penalty with respect to
each such document in the amount determined under
subsection (b).
26 U.S.C. § 7454 - Burden of proof in fraud,
foundation manager, and transferee cases
(a) Fraud
In any proceeding involving the issue whether the
petitioner has been guilty of fraud with intent to evade
tax, the burden of proof in respect of such issue shall
be upon the Secretary.
5
69a
Appendix E
(b) Foundation managers
In any proceeding involving the issue whether a
foundation manager (as defined in section 4946(b))
has “knowingly” participated in an act of self-dealing
(within the meaning of section 4941), participated in
an investment which jeopardizes the carrying out of
exempt purposes (within the meaning of section 4944),
or agreed to the making of a taxable expenditure
(within the meaning of section 4945), or whether the
trustee of a trust described in section 501(c)(21) has
“knowingly” participated in an act of self-dealing
(within the meaning of section 4951) or agreed to the
making of a taxable expenditure (within the meaning
of section 4952), or whether an organization manager
(as defined in section 4955(f)(2)) has “knowingly”
agreed to the making of a political expenditure (within
the meaning of section 4955), or whether an
organization manager (as defined in section
4912(d)(2)) has “knowingly” agreed to the making of
disqualifying lobbying expenditures within the
meaning of section 4912(b), or whether an
organization manager (as defined in section 4958(f)(2))
has “knowingly” participated in an excess benefit
transaction (as defined in section 4958(c)), the burden
of proof in respect of such issue shall be upon the
Secretary.
26 U.S.C. § 7701 – Definitions
(a) When used in this title, where not otherwise
distinctly expressed or manifestly incompatible with
the intent thereof—
6
70a
Appendix E
(11) Secretary of the Treasury and Secretary
(A) Secretary of the Treasury
The term “Secretary of the Treasury” means
the Secretary of the Treasury, personally, and shall
not include any delegate of his.
(B) Secretary
The term “Secretary” means the Secretary of the
Treasury or his delegate.
(36) Tax return preparer
(A) In general
The term “tax return preparer” means
any person who prepares for compensation, or who
employs one or more persons to prepare for
compensation, any return of tax imposed by this title
or any claim for refund of tax imposed by this title. For
purposes of the preceding sentence, the preparation of
a substantial portion of a return or claim for refund
shall be treated as if it were the preparation of such
return or claim for refund.
(B) Exceptions
A person shall not be a “tax return preparer”
merely because such person—
(i) furnishes typing,
mechanical assistance,
7
reproducing,
or
other
71a
Appendix E
(ii) prepares a return or claim for refund of the
employer (or of an officer or employee of the employer)
by whom he is regularly and continuously employed,
(iii) prepares as a fiduciary a return or claim for
refund for any person, or
(iv) prepares a claim for refund for a taxpayer in
response to any notice of deficiency issued to
such taxpayer or in response to any waiver of
restriction after the commencement of an audit of
such taxpayer or another taxpayer if a determination
in such audit of such other taxpayer directly or
indirectly affects the tax liability of such taxpayer.
28 U.S.C. § 1254 - Courts of appeals; certiorari;
certified questions
Cases in the courts of appeals may be reviewed by
the Supreme Court by the following methods:
(1) By writ of certiorari granted upon the petition
of any party t
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