The opinion of the court was delivered by: Richard W. Roberts, United States District Judge.
Plaintiff brought this action for a refund of his 1986 federal income tax withholdings and for exemplary damages. Defendant has moved for summary judgment. Because plaintiff's refund claim is barred by the "look back" provisions of 26 U.S.C. § 6511(b) (2000), and plaintiff's exemplary damages claim is barred by the doctrine of res judicata, defendant's motion will be granted.
Plaintiff retired from the District of Columbia city government on July 18, 1981 due to a disability. (Def.'s Statement of Material Facts ("Def.'s Stmnt.") at ¶ 1.) Upon retirement, plaintiff was entitled to a pension annuity of $349 per month, from which he elected to have deducted health insurance, life insurance, and re-deposits into a Civil Service retirement account. (Id. at ¶¶ 2-3.) The Office of Personnel Management ("OPM"), which manages plaintiff's pension, was unable to locate plaintiff until 1986, when it retroactively compensated him for the years 1981 through 1986. (Id. at ¶¶ 4-5.) OPM distributed $23,206.00 in compensation as follows: (1) $2,100.49 was paid directly to plaintiff; (2) $18,368.31 was applied to deductions including health insurance, life insurance, and civil service redeposits; and (3) $2,737.20 was withheld for federal taxes. (Id. at ¶¶ 6-8.) The $2,737.20 federal tax withholding for 1986 is the subject of plaintiff's claim.
In 1988, the Internal Revenue Service (the "IRS") received a Statement from OPM that plaintiff had earned income of $23,206.00 in 1986. (Compl. at 1; Def.'s Answer at ¶ 2.) After being contacted by the IRS, plaintiff went to OPM's Washington, D.C. offices on two occasions in an attempt to resolve what he believed was a mistake in the OPM Statement. See Van Sant v. Commissioner of Internal Revenue ("Van Sant I"), No. 14540-91, 1994 WL 4251, at 7 (T.C. Jan. 10, 1994) (as amended Jan. 13, 1994). He was told that OPM would get back to him in four to six weeks. That did not happen. See id.
Plaintiff next went to the IRS office at Bailey's Crossroads in Alexandria, Virginia. The Bailey's Crossroads office referred the inquiry to the IRS's Problem Resolution Office (the "PRO") in Richmond, Virginia. In an undated letter, a caseworker from the PRO office informed plaintiff that he indeed had received $23,206.00 in taxable income for 1986. The PRO's alleged reasoning was that OPM had told the PRO that plaintiff had received $23,206.00 in 1986. See id.
Plaintiff claims that he filed an income tax return for 1986 in November, 1990 because the IRS threatened him with criminal prosecution if he did not. (Compl. at 1.) Defendant states that it is "without sufficient knowledge" to assess the accuracy of this claim. (Def.'s Answer at ¶ 3.) Plaintiff has not provided any documentation to confirm that he did in fact file his 1986 tax return in November, 1990.
On April 10, 1991, the IRS mailed to plaintiff a notice of deficiency for the tax year 1986 in the amount of $5,969.00, which was in addition to the $2,737.20 already withheld by the IRS for that year. (Def.'s Stmnt. at ¶¶ 9-11.) The notice was based on the IRS's determination that all $23,206.00 of plaintiff's OPM benefits, as well as $8,826.00 in Social Security benefits received by plaintiff and his wife, were taxable income for 1986. (Id. at ¶ 10.
Plaintiff filed a timely petition in United States Tax Court challenging the deficiency. (Id. at ¶ 12.) At one point after filing his petition, plaintiff was invited to meet with an appeals officer of the IRS. See Van Sant I, 1994 WL 4251, at 7. The meeting consisted of the officer asking plaintiff if plaintiff had brought his checkbook. See id.
The Tax Court ordered plaintiff to file a joint income tax return for 1986, which plaintiff completed on October 22, 1993. (Def.'s Mot. Summ. J. Ex. D at 2.) On that return, plaintiff claimed he was entitled to a refund for 1986 in the amount of $2,737.20 -- the amount of the 1986 withholding. (Id. at 3.
On January 10, 1994, the Tax Court issued its decision. See Van Sant I, 1994 WL 4251, at 1. The court found that Social Security benefits the plaintiff and his wife received for the tax year 1986 were not taxable; that plaintiff had constructively received his monthly annuity payments beginning in July 1981; and that plaintiff's only taxable income for 1986 therefore was a grand total of $4,114.00. See id. at 9-10. The court further found that there was no deficiency in plaintiff's federal income tax due for 1986, no additions to tax were due from him, and plaintiff was not required to file a federal income tax return for 1986. See id. at 10-11. The court concluded that "[t]his is a case that should not have been brought to trial." Id. at 11. Defendant claims that the Tax Court "did not address the 1986 federal tax withholding of $2,737.20." (Def.'s Stmnt. at ¶ 16.
On February 21, 1995, the IRS sent plaintiff a letter stating that his tax refund claim made on his October 22, 1993 return was disallowed because the statute of limitations had expired. (Def.'s Answer at ¶ 5.) Plaintiff responded on February 16, 1996, by bringing suit in this Court against the Commissioner of the IRS, the former Commissioner, and two former IRS employees, alleging they were negligent in their actions at the administrative level and in their litigation before the Tax Court with respect to plaintiff's notice of deficiency for 1986. (Def.'s Stmnt. at ¶ 21.) On August 7, 1996, the Honorable Ricardo M. Urbina of this Court dismissed the action with prejudice for lack of subject matter jurisdiction. See Van Sant v. United States ("Van Sant II"), No. 96-00309, 1996 WL 627438, at *2 (D.D.C. Aug. 7, 1996) (order granting defendant's motion to dismiss). That dismissal was affirmed by the Court of Appeals. See Van Sant v. United States, No. 96-5299, 1997 WL 404965 (D.C. Cir. July 2, 1997).
On February 24, 1997, plaintiff filed the instant action, seeking a refund in the amount of the $2,737.20 withholding plus ten percent interest and exemplary damages of $1 million for "aggravations, mental anguish caused by the defendant." (Compl. at 1.) On May 1, 1997, defendant filed a motion for summary judgment, arguing that: (1) this Court lacks subject matter jurisdiction because the statute of limitations and "look back" provisions of 26 U.S.C. § 6511 bar plaintiff's claim for his 1986 withholdings; and (2) plaintiff's claims are precluded by res judicata because (a) the issue of a refund for 1986 should have been litigated in the Tax Court, and (b) the issue of exemplary damages was previously litigated and decided in this Court by Judge Urbina. ...