United States Court of Appeals For the Seventh Circuit
Tax — improper collection efforts
A taxpayer lacks standing under I.R.C. 7433, where the IRS’ collection efforts were not made against him personally.
“The plaintiffs principally allege that the Group directed Johnson to apply a handful of voluntary payments towards its trust fund liability, but Johnson applied the payments to the non-trust fund portion. This increased Gessert’s personal liability. The parties also allege that Johnson violated a series of Internal Revenue Code (‘Code’) and Treasury provisions and that she improperly levied the Group’s accounts.”
“However, Gessert lacks standing under I.R.C. § 7433 because Johnson sought collection from the Group, not Gessert. Further, the Group failed to allege economic harm, which is also prerequisite to standing under I.R.C. § 7433. With respect to the refund claim, the district court properly concluded the Group filed its administrative claim too late. Finally, Gessert’s refund-and-abatement claim fails because the Group did not provide specific written direction to the IRS effectuating a directed payment.”
Appeal from the United States District Court for the Eastern District of Wisconsin, Adelman, J., Flaum, J.