Opinion
Docket No. 000031-2014
05-22-2015
Re: John N. Backos v. Director, Division of Taxation
John N. Backos 78 Rolling Ridge Road Upper Saddle River, NJ 07458 Paul V. Buonaguro Deputy Attorney General Division of Law R.J. Hughes Justice Complex P.O. Box 106 25 Market Street Trenton, New Jersey 08625-0106
NOT FOR PUBLICATION WITHOUT APPROVAL OF THE TAX COURT COMMITTEE ON OPINIONS
John N. Backos
78 Rolling Ridge Road
Upper Saddle River, NJ 07458
Paul V. Buonaguro
Deputy Attorney General
Division of Law
R.J. Hughes Justice Complex
P.O. Box 106
25 Market Street
Trenton, New Jersey 08625-0106
Dear Mr. Backos and Mr. Buonaguro:
This letter constitutes the court's opinion with respect to the Director, Division of Taxation's motion for summary judgment. For the reasons discussed below the Director's motion is granted.
I. Procedural History and Findings of Fact
The court makes the following findings of fact based on the moving papers and certifications submitted herein.
John N. Backos and Susan Nicoletta-Backos, husband and wife, requested an extension to file their joint New Jersey Gross Income Tax Return for the 2008 tax year on April 15, 2009. With their extension they included a check in the amount of $1,800.00 to be applied against tax due. On August 26, 2009, the parties filed a joint NJ Form 1040 for the tax year 2008. This return showed total taxes payable in the amount of $8,639 with an amount paid of $4,688 and a balance due of $3,951.
On April 17, 2012, two years and three and one-half months after the filing of the original return, the parties filed a joint amended return (NJ Form 1040X) which again showed total taxes due in the amount of $8369.00 with payments in this amount having been made. Thus, no refund was requested with respect to the amended return. It is not clear why the amended return was filed as no change in the amounts as originally reported was made on the amended return filed except to reflect the additional tax paid with the original return.
On November 19, 2012, three years three months and two days after the original return was filed and tax was paid, plaintiff filed a second amended return (both an NJ Form 1040X and an NJ Form 1040). This return reduced the amount of wages, salaries tips and other employee compensation and increased medical expense deductions, resulting in total taxes due being reduced to $3,758.00. The return requested a refund of $4,881. It appears, however, that the amount of the refund claimed due is $930.00 because the payment indicated as having been made with the original return of $4,951 was not actually made.
On November 8, 2013, the Director, issued a Final Determination denying the plaintiff's request for a refund of $932.62 and citing N.J.S.A. 54A:9-8 to support the denial. Plaintiff then filed a timely complaint with this court, appealing the Director's final determination.
On March 27, 2015, the Director filed the instant motion for summary judgment in this matter seeking to have the matter dismissed for untimely filing under N.J.S.A. 54A:9-8. Plaintiff did not submit any opposition to the motion and did not appear for oral arguments.
II. Conclusions of Law
A. Summary Judgment
Summary judgment should be granted where "the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show there is no genuine issue as to any material fact challenged and the moving party is entitled to a judgment or order as a matter of law." R. 4:46-2(c). In Brill v. Guardian Life Insurance Company, 142 N.J. 520 (1995), the New Jersey Supreme Court established the standard for summary judgment:
[W]hen deciding a motion for summary judgement under Rule 4:46-2, the determination whether there exists a genuine issue with respect to a material fact challenged requires the motion judge to consider whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party in consideration of the applicable evidentiary standard, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party.
[Brill v. Guardian Life Ins. Co., supra, 142 N.J. 520, 523.]
"[T]he determination [of] whether there exists a genuine issue with respect to a material fact challenged requires the motion judge to consider whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party in consideration of the applicable evidentiary standard, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Ibid.
Defendant submitted a certification including the returns filed by the plaintiff in this matter and describing the facts set forth above. Plaintiff did not file any responding certifications. The documentary evidence provided in this matter by the defendant demonstrates that there are no genuine issues of material fact which would prohibit this court from rendering a decision in this matter. Accordingly, the court finds the matter is ripe for summary judgment.
B. Legal Standard
The court begins its analysis by noting the familiar principle that the Director's interpretations of tax statutes are entitled to a presumption of validity. "Courts have recognized the Director's expertise in the highly specialized and technical area of taxation." Aetna Burglar & Fire Alarm Co. v. Director, Div. of Taxation, 16 N.J. Tax 584, 589 (Tax 1997) (citing Metromedia, Inc. v. Director, Div. of Taxation, 97 N.J. 313, 327 (1984)). "Generally, courts accord substantial deference to the interpretation an agency gives to a statute that the agency is charged with enforcing." GE Solid State, Inc. v. Director, Div. of Taxation, 132 N.J. 298, 306 (1993)
Further, "[s]tatutory filing deadlines pertaining to tax matters are jurisdictional and if not complied with, an otherwise eligible taxpayer waives his entitlement to any refund." Pantasote, Inc. v. Director, Div. of Taxation, 8 N.J. Tax 160, 164 (Tax 1985) (citing Riteway Rentals v. Director, Div. of Motor Vehicles, 2 N.J. Tax 117, 119 (Tax 1981) and Commercial Refrigeration & Fixture Co., Inc. v. Director, Div. of Taxation, 2 N.J. Tax 415, 419 (Tax 1981)).
Refund moneys are available to be claimed by a taxpayer or by a person required to collect the tax according to well-defined procedures. An otherwise eligible taxpayer or vendor who does not comply with the established procedures waives his entitlement to any refund. After the ... limitation period for the filing of a refund application has passed, the State is entitled to assume that its tax revenues need not be refunded under any circumstances. The limitation period is mandatory and is justified by the need for predictability of revenues by the State.[Commercial Refrigeration v. Director, Div. of Taxation, supra, 2 N.J. Tax at 419 (citing William McCullough Transportation Co. v. Division of Motor Vehicles, Bureau of Motor Carriers, 113 N.J. Super. 353).]
It follows that Gross Income Tax refund claims filed beyond the statutory deadline would be therefore be barred. See Bonanno v. Director, Div. of Taxation, 12 N.J. Tax 552 (1992) (Gross Income Tax refund filed five and one-half years after the initial return deemed untimely).
Further, "equitable relief is not available in the context of a stale claim for a tax refund." Trump Plaza Associates v. Director, Div. of Taxation, 25 N.J. Tax 555, 563 (Tax 2010) (citing Estate of Ehringer v. Director, Div. of Taxtation, 24 N.J. Tax 599, 616 (Tax 2009), aff'd, 412 N.J. Super. 316 (App. Div. 2010) (internal quotations omitted)).
The relevant statute, N.J.S.A. 54A:9-8, states that: "Claim for credit or refund of an overpayment of income tax shall be filed by the taxpayer within 3 years from the time the return was filed or 2 years from the time the tax was paid, whichever of such periods expires the later[.]" N.J.S.A. 54A:9-8(a). "No credit or refund shall be allowed or made ... after the expiration of the applicable period of limitation specified in this act, unless a claim for credit or refund is filed by the taxpayer within such period. Any later credit shall be void and any later refund erroneous." N.J.S.A. 54A:9-8(d).
The plaintiff filed the initial Gross Income Tax return on August 26, 2009. An amended return stating a claim for refund was not filed by the plaintiff until November 19, 2012. The elapsed time from the filing of the first return to the filing of the amended return claiming a refund was a period of three years and eighty-five days, clearly outside of the statutory period of three years.
As a result of the plaintiff's failure to amend their return and claim a refund prior to the expiration of the statutory period outlined in N.J.S.A. 54A:9-8, the court will affirm the Director's Final Determination in this matter.
III. Conclusion
The Director's motion for summary judgment is granted. Judgment dismissing the plaintiff's complaint will be entered accordingly.
Very truly yours,
/s/
Hon. Kathi F. Fiamingo, J.T.C.