Gray v. United States, No. 12-3523 (7th Cir. 2013)
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Gray filed returns for tax years 2001 through 2004 after the IRS notified her in 2006 that it planned to assess her tax liability on its own. The IRS accepted Gray’s calculations, but imposed penalties for late filing and payment, 26 U.S.C. 6651. When Gray did not pay, the IRS filed liens. Gray timely requested a Collections Due Process hearing, 26 U.S.C. 6330, at which she unsuccessfully argued that penalties, liens, and levies should be eliminated. The IRS then mailed Gray “notices of determination” approving liens and levies. Gray sought review in Tax Court, waiting more than 30 days to file. The court concluded that it lacked jurisdiction because Gray’s petitions were untimely. The Seventh Circuit affirmed. The statute creates a 30-day time limit for appealing CDP determinations, 26 U.S.C. 6330(d)(1); no longer period applied to Gray’s cases. Gray then claimed that IRS employees engaged in wide-ranging wrongdoing in dealing with her and sought damages for unauthorized tax collection, 26 U.S.C. 7433. More than six months later, after the IRS moved to dismiss for failure to exhaust administrative remedies, Gray filed an administrative claim. The district court dismissed. The Seventh Circuit affirmed, stating that the exhaustion requirement is not actually jurisdictional, but is still mandatory.
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