Deaton v. Commissioner

United States Court of Appeals
Fifth Circuit
F I L E D
UNITED STATES COURT OF APPEALS
for the Fifth Circuit February 9, 2006

Charles R. Fulbruge III
Clerk
No. 05-60278

BARBARA DEATON,

Petitioner-Appellant,

VERSUS

COMMISSIONER OF INTERNAL REVENUE,

Respondent-Appellee.

consolidated with No. 05-60292

RONNY DEATON,

Petitioner-Appellant,

VERSUS

COMMISSIONER OF INTERNAL REVENUE,

Respondent-Appellee.

Appeals from the United States Tax Court

Before GARWOOD, DeMOSS, and BENAVIDES, Circuit Judges.

DeMOSS, Circuit Judge:

Barbara and Ronny Deaton (the “Deatons”) appeal a decision of
the United States Tax Court (the “Tax Court”) sustaining a finding

of the Internal Revenue Service Appeals Office (the “Appeals

Office”) that the Deatons’ 1994 remittance of $125,000--which

accompanied their Form 4868 application for an extension of time to

file their 1993 tax return--was a “payment,” not a “deposit,” and

that as such, it could not be credited against the Deatons’

1994–1996 tax liabilities because it fell outside the “look-back

period” of I.R.C. § 6511(b)(2)(A).

I. Facts and Proceedings

On April 15, 1994, the deadline for filing a 1993 U.S.

Individual Income Tax Return, the Deatons filed a Form 4868 with

the Internal Revenue Service (IRS) to extend the time for filing

their return. Form 4868, titled “Application for Automatic

Extension of Time to File U.S. Individual Income Tax Return,”

automatically extends a taxpayer’s time to file his return if the

taxpayer meets certain conditions; however, it does not extend the

time to pay tax. See Treas. Reg. § 1.6081-4(b) (1993) (“[A]ny

automatic extension of time for filing an individual income tax

return . . . shall not operate to extend the time for payment of

any tax due on such return.”).1 To qualify for a Form 4868

automatic extension of time to file, the Deatons had to “[p]roperly

estimate [their] 1993 tax liability using the information available

1
The 1993 version of Form 4868 clearly stated under its title,
“This is not an extension of time to pay your tax.” I.R.S. Form
4868 (OMB No. 1545-0188) (1993).

2
to [them], [e]nter [their] tax liability on line 1 of Form 4868,

[and] [f]ile Form 4868 by the due date of [their] return.” I.R.S.

Instructions for Form 4868 (Cat. No. 15385N) (1993); see also

Treas. Reg. § 1.6081-4(a)(4) (1993) (“Such application for

extension must show the full amount properly estimated as tax for

such taxpayer for such taxable year . . . .”). Although the Deatons

were not required to remit any amount to the IRS with their form,

see I.R.S. Instructions for Form 4868 (Cat. No. 15385N) (1993) (“If

you find you can’t pay the full amount shown on line 3, you can

still get the extension.”),2 the instructions to Form 4868

indicated that a taxpayer would be liable for interest and possibly

a late payment penalty if he submitted less than the full amount of

estimated taxes with his form, id.

To avoid incurring interest and any late payment penalty, the

Deatons submitted to the IRS with their Form 4868 a check in the

amount of $125,000, which they calculated as the line 3 “balance

due” after deducting payments of $13,883 (in the form of

withholdings) from their estimated tax liability of $138,883.

Following receipt of the form, the IRS extended the Deatons’

deadline for filing their 1993 return by six months; however, the

2
Until 1992, full payment was a condition of receiving an
extension; however, the IRS removed that condition in 1992 so that
taxpayers who were unable to pay the full amount of estimated taxes
could nevertheless obtain an automatic four-month filing extension
and relief from late-filing penalties. See I.R.S. Notice 92-22,
1993-1 C.B. 305.

3
Deatons missed the extended deadline and in fact did not file their

1993 return until January 2000, nearly six years after its due

date. The Deatons also failed to file timely returns for the tax

years 1994, 1995, and 1996.

On January 10, 2000, the Deatons filed delinquent returns for

the tax years 1993 through 1996. On their 1993 return, they

reported a tax liability of only $88,662, which indicated that they

had overestimated their 1993 tax liability on Form 4868 by $50,221.

The Deatons requested that this overpayment be carried forward and

credited as a payment toward their tax liabilities for the years

following 1993.

Shortly after the IRS received the Deatons’ 1993-1996 tax

returns, it formally assessed the amounts reported as tax on each

of the returns. For 1993, the IRS applied the amount already paid

by withholding ($13,883) and the April 1994 remittance ($125,000)

to the reported tax liability of $88,662. The IRS then posted the

resulting overpayment of $50,221 to an “excess collections” account

and did not carry it forward on the Deatons’ account as a credit

for subsequent tax years as the Deatons requested. According to the

IRS, the Deatons’ credit request was barred by I.R.C.

§ 6511(b)(2)(A), which limits the amount of a credit or refund

claimed by a taxpayer to the amount paid within the “look-back

period” under that subsection, that is, the three years (plus the

period of any extension of time for filing the return) immediately

preceding the filing of the claim. I.R.C. § 6511(b)(2)(A). The

4
Deatons had paid nothing to the IRS within the applicable look-back

period, which dated back to July 10, 1996,3 so their credit was

limited to zero.

This litigation arose out of the IRS’s attempt to levy the

Deatons’ property to satisfy their 1994–1996 tax liabilities, which

remained unpaid because of the IRS’s refusal to apply the 1993

overpayment as a credit in later years. After the IRS issued a

Notice of Intent to Levy, the Deatons timely filed a request for a

collection due process hearing with the IRS Appeals Office. In

their request for a hearing, the Deatons asserted that the 1994

remittance of $125,000 was a “deposit” rather than a “payment,” a

status that would have protected the remittance from the look-back

period for credits and refunds.4 The Appeals Office rejected the

Deatons’ assertion, classified their 1994 remittance as a payment,

subject to I.R.C. § 6511(b)(2)(A)’s look-back period, and sustained

the IRS’s proposed levy.

The Deatons were likewise unsuccessful before the Tax Court.

3
Considering the six-month extension the IRS gave the Deatons to
file their 1993 return, the look-back period was the three years
and six months immediately preceding the date of their claim for a
credit, January 10, 2000.
4
See I.R.C. § 6511(b)(2)(A) (“[T]he amount of the credit or
refund shall not exceed the portion of the tax paid within the
period . . . .” (emphasis added)). The distinct treatment of
deposits and payments first arose in Rosenman v. United States, 323
U.S. 658 (1945), in which the Supreme Court recognized that
§ 6511’s predecessor was not applicable to a deposit even though it
would have been applicable to a payment. Dantzler v. United States,
183 F.3d 1247, 1249 (11th Cir. 1999).

5
Although the Tax Court acknowledged the judicially created

distinction between a deposit and a payment, the court also

recognized a three-way split of authority regarding the treatment

of a Form 4868 remittance. Applying its own precedent in Risman v.

Commissioner, 100 T.C. 191 (1993), which calls for an examination

of the facts and circumstances of a case in order to determine

whether the taxpayer intended his remittance as a deposit or a

payment, the Tax Court reviewed the Deatons’ tax records and a

letter from their accountant asserting that the $125,000 was a

deposit. Finding that the Deatons had failed to demonstrate their

contemporaneous intent to treat the remittance as a deposit, the

Tax Court sustained the Appeals Office’s finding that the Deatons’

remittance was a payment made outside the look-back period of

§ 6511(b)(2)(A) and upheld the Appeals Office’s determination that

the IRS’s proposed levy could proceed. This appeal ensued. Because

we agree with the Tax Court that the Deatons’ 1994 remittance was

a payment, rather than a deposit, we AFFIRM the Tax Court’s

decision.

II. Discussion

A. Standard of Review

The sole issue on appeal is whether the Deatons’ 1994

remittance of $125,000 was a payment or a deposit. This is a

question of law that we review de novo. San Antonio Sav. Ass’n v.

Comm’r, 887 F.2d 577, 581 (5th Cir. 1989) (“This court has

6
jurisdiction to review the decisions of the tax court ‘in the same

manner and to the same extent as decisions of the district courts

in civil actions tried without a jury.’ We therefore examine this

decision as we do other summary judgment decisions. Because the

dispute concerns findings of law, we review on a de novo standard.”

(quoting 26 U.S.C. § 7482 (1982))). The Tax Court’s factual

findings are reviewed for clear error. Sandvall v. Comm’r, 898 F.2d

455, 458 (5th Cir. 1990).

B. Analysis

The Deaton’s argue on appeal that the $125,000 remittance that

accompanied their Form 4868 application for an extension of time to

file was a deposit and that as such, it is not subject to the look-

back period of I.R.C. § 6511(b)(2)(A). They ask this Court to

reverse the Tax Court’s decision and order the IRS to apply their

1993 overpayment as a credit to their 1994–1996 tax liabilities or

refund the overpayment to them. The Deatons concede that if the

1994 remittance is properly classified as a payment, the IRS may

keep their overpayment because of § 6511(b)(2)(A)’s look-back

period.

In deciding this appeal, we must assess the impact of the

Supreme Court’s recent decision in Baral v. United States, 528 U.S.

431 (2000), on this Circuit’s longstanding rule that remittances

made prior to assessment of a tax are deemed deposits rather than

payments. See Harden v. United States, 74 F.3d 1237 (5th Cir. 1995)

7
(unpublished); Ford v. United States, 618 F.2d 357 (5th Cir. 1980);

Thomas v. Mercantile Nat’l Bank, 204 F.2d 943 (5th Cir. 1953). The

Deatons contend that Baral has no effect on their case or on our

longstanding rule because it is limited to cases involving

remittances governed by the “deemed paid” provision of I.R.C.

§ 6513(b)5--for example, wage withholdings and payments of

estimated tax--and they argue that their remittance does not fall

under that section. They urge that the proper characterization of

their remittance depends on the facts and circumstances associated

with it under Rosenman, which predates Baral. According to the

Deatons, the facts and circumstances surrounding their 1994

remittance establish their contemporaneous intent to treat it as a

5
Section 6513(b) states,
Prepaid income tax.--For purposes of section 6511 or 6512--
(1) Any tax actually deducted and withheld at the source
during any calendar year under chapter 24 shall, in respect of
the recipient of the income, be deemed to have been paid by
him on the 15th day of the fourth month following the close of
his taxable year with respect to which such tax is allowable
as a credit under section 31.
(2) Any amount paid as estimated income tax for any taxable
year shall be deemed to have been paid on the last day
prescribed for filing the return under section 6012 for such
taxable year (determined without regard to any extension of
time for filing such return).
(3) Any tax withheld at the source under chapter 3 shall, in
respect of the recipient of the income, be deemed to have been
paid by such recipient on the last day prescribed for filing
the return under section 6012 for the taxable year (determined
without regard to any extension of time for filing) with
respect to which such tax is allowable as a credit under
section 1462. For this purpose, any exemption granted under
section 6012 from the requirement of filing a return shall be
disregarded.
I.R.C. § 6513(b) (emphasis added).

8
deposit, and they assert that Fifth Circuit law at that time

supports such a finding.6 The Commissioner counters that after

Baral, we should treat remittances accompanying Form 4868

applications as payments as a matter of law; alternatively, the

Commissioner argues that the Tax Court correctly ruled under the

facts-and-circumstances test that the Deatons’ remittance was a

payment, not a deposit. Because we have not previously explicitly

addressed Baral’s impact on our law,7 we do so here. And for the

reasons stated below, we agree that the Deatons’ remittance was a

payment, not a deposit. However, we decline to adopt a per se rule

to govern remittances accompanying Form 4868 applications as the

Commissioner requests.

1. Origin of the Deposit–Payment Distinction

The distinction between deposits and payments was first

established in Rosenman. In that case, the Supreme Court considered

whether the predecessor to the current look-back provision barred

a claim for refund of estimated estate taxes that the decedent’s

executors had remitted in response to an absolute deadline, but

6
Because this Circuit treated pre-assessment remittances as
deposits at the time the Deatons made their Form 4868 remittance,
they argue that it was intended as a deposit under then-current
law. This argument fails, as discussed in Part II.B.4.
7
Although we have decided a deposit–payment case since Baral, see
Harrigill v. United States, 410 F.3d 786 (5th Cir. 2005), we did
not discuss Baral’s impact on our law in that case because the
parties conceded that the Mercantile National Bank line of
authority, discussed below, was abrogated by Baral, see id. at 790
n.6.

9
which they strenuously disputed as erroneous. Rosenman, 323 U.S. at

659-61. The executors had included a transmittal letter with the

remittance, emphasizing that “[t]his payment is made under protest

and duress, and solely for the purpose of avoiding penalties and

interest, since it is contended by the executors that not all of

this sum is legally or lawfully due.” Id. at 660 (internal

quotation marks omitted). The IRS credited the remittance to a

special suspense account, which was created to hold the funds

because no taxes had yet been formally assessed against the estate.

Id. After completing an audit of the return nearly three years

later, the IRS formally assessed a deficiency. Id. When the

executors brought a claim for refund more than three years after

the remittance--but within three years of the IRS’s formal

assessment--the claim was rejected as time barred. Id. at 660-61.

In deciding that the taxes were not “paid”--and that the

limitations period therefore did not commence--until the tax was

actually assessed by the IRS, the Supreme Court specifically

considered all of the facts and circumstances surrounding the

executors’ original remittance, including the executors’ intent as

stated in the transmittal letter and the IRS’s treatment of the

remittance once received. Id. at 661-63. The Court determined that

when the executors submitted the remittance, they “did not

discharge what [they] deemed a liability nor pay one that was

asserted. There was merely an interim arrangement to cover whatever

10
contingencies the future might define.” Id. at 662. Noting the

IRS’s deposit of the funds into a suspense account, the Court

concluded that “[m]oney in these accounts is held not as taxes duly

collected are held but as a deposit made in the nature of a cash

bond for the payment of taxes thereafter found to be due.” Id. The

Court ruled that considering the specific facts and circumstances

of the case, the remittance was a deposit and that the statute of

limitations therefore did not bar the executors’ claim for refund.

Courts have since read Rosenman as creating a facts-and-

circumstances test for distinguishing between deposits and

payments. See, e.g., VanCanagan v. United States, 231 F.3d 1349,

1352-53 (Fed. Cir. 2000); Moran v. United States, 63 F.3d 663, 667-

68 (7th Cir. 1995); Blatt v. United States, 34 F.3d 252, 255 (4th

Cir. 1994); Ewing v. United States, 914 F.2d 499, 503-04 (4th Cir.

1990); Fortugno v. Comm’r, 353 F.2d 429, 435-36 (3d Cir. 1965);

Risman, 100 T.C. at 197-99. However, this Circuit did not join

those courts in their reading of Rosenman.

2. Fifth Circuit Law Post-Rosenman

Our Circuit first applied Rosenman in Thomas v. Mercantile

National Bank, 204 F.2d 943 (5th Cir. 1953). The Mercantile

National Bank panel read the Rosenman decision as establishing a

rule that any amount remitted to the IRS prior to a formal

assessment of tax is, as a matter of law, a deposit. Id. at 944.

Citing Rosenman, the Court held a claim for refund timely because

11
 [u]ntil the Commissioner certified the assessment
list . . . there was no deficiency assessment, and no
liability on the part of the taxpayer, and consequently
nothing to pay. The sum deposited with the
Collector . . . was merely an advance deposit to cover
additional tax liability expected to arise thereafter.
Neither the estate’s liability, nor the fact that there
was an overpayment could be determined until the
deficiency assessment was entered. It would be illogical
to hold, as the United States contends, that the statute
of limitation began to run against a claim for refund
before the deficiency itself came into existence, and
before the fact that there was an overpayment, and if so
the amount thereof, became ascertainable.

Id. Mercantile National Bank thus took Rosenman beyond its narrow

facts and circumstances, which the Supreme Court had specifically

emphasized in reaching its decision, and adopted a per se rule that

pre-assessment remittances are deposits.

Almost thirty years after Mercantile National Bank was

decided, a panel of this Court begrudgingly applied its per se rule

in Ford v. United States, 618 F.2d 357 (5th Cir. 1980), but not

without making clear its disagreement with Mercantile National

Bank’s holding: “Despite our view of Supreme Court precedent, the

course taken by our sister circuits, and appropriate tax policy, we

are constrained . . . by the bonds of Thomas v. Mercantile National

Bank at Dallas.” Id. at 358. After thoroughly discussing the

reasons for abandoning the rule and inviting the Court to

reconsider it en banc, the panel nevertheless applied Mercantile

National Bank as binding circuit precedent. Id. at 358-61. The

motion for rehearing en banc was denied. Ford v. United States, 625

12
F.2d 1016 (5th Cir. 1980).

Fifteen years later, the Fifth Circuit again addressed

Mercantile National Bank in Harden v. United States, 74 F.3d 1237

(5th Cir. 1995) (unpublished).8 The facts of Harden are virtually

identical to those of the instant case. The Hardens filed Form 4868

for both the 1984 and 1985 tax years, and they submitted

remittances with each filing. Harden, 74 F.3d at 1237. Several

years later, they filed their tax returns for those years,

indicating substantially lower tax liabilities than the amounts

previously remitted. Id. Like the Deatons, the Hardens sought to

apply the overpayments as credits for subsequent tax years, but the

IRS denied their request as time-barred. Id.

The government argued in Harden that Mercantile National Bank

and Ford were distinguishable because they did not address taxpayer

remittances accompanying Form 4868. According to the government, 26

U.S.C. § 6513 expressly defined such remittances as “payments” of

tax for purposes of the statute of limitations, so the remittances

were payments, not deposits, as a matter of law. Although the

Harden panel appreciated the government’s “rational and forceful

argument,” it concluded that it was “bound to the decisions of this

court in [Mercantile National Bank] and Ford. In those cases we

8
Although Harden was unpublished, it is considered precedent
because it was issued under our former rule concerning unpublished
opinions. See 5TH CIR. R. 47.5.3 (“Unpublished opinions issued before
January 1, 1996, are precedent.” (footnote omitted)).

13
held that as a matter of law a remittance forwarded to the IRS

before an assessment of tax is to be considered a deposit rather

than a payment.” Id.

3. Impact of Baral v. United States

We now hold that post-Baral, we are no longer bound by the

Mercantile National Bank line of authority. In Baral, the Supreme

Court explicitly rejected the taxpayer’s argument that a tax cannot

be “paid” until tax liability is assessed and thereby abrogated the

Mercantile National Bank rule that a pre-assessment remittance is

a deposit rather than a payment. Baral, 528 U.S. at 434, 437

(“[T]he Code directly contradicts the notion that payment may not

occur before assessment.”).9 The unanimous Court construed the

plain language of 26 U.S.C. § 6513(b)(1) and (2) as providing

unequivocally that two types of remittances, wage withholdings and

payments of estimated income tax, are to be “deemed paid” on the

due date of the tax return for the tax year in question, not when

formal assessment occurs. Baral, 528 U.S. at 434-36. This treatment

necessarily precludes the argument that all pre-assessment

remittances are deposits, the position that this Court took prior

to Baral and that the Deatons argue still prevails.

9
That the Baral Court was specifically addressing the Fifth
Circuit’s position as compared to those of various other circuits
supports a finding of abrogation. Id. at 434 (“In view of an
apparent tension between [the Circuits], we granted certiorari.”);
see also Harrigill v. United States, 410 F.3d 786, 790 n.6 (5th
Cir. 2005) (not refuting the parties’ concession that Baral
abrogated the Fifth Circuit rule).

14
 According to the Deatons, Baral only applies to remittances

that fall under 26 U.S.C. § 6513(b), not to transmittals made with

Form 4868, and their position is bolstered by the Court’s final

statement in Baral:

We need not address the proper treatment under § 6511 of
remittances that, unlike withholding and estimated income
tax, are not governed by a “deemed paid” provision akin
to § 6513(b). Such remittances might include remittances
of estimated estate tax, as in Rosenman, or remittances
of any sort of tax by a taxpayer under audit in order to
stop the running of interest and penalties. In the latter
situation, the taxpayer will often desire treatment of
the remittance as a deposit--even if this means
forfeiting the right to interest on an overpayment--in
order to preserve jurisdiction in the Tax Court, which
depends on the existence of a deficiency, a deficiency
that would be wiped out by treatment of the remittance as
a payment. We note that the Service has promulgated
procedures to govern classification of a remittance as a
deposit or payment in this context.

Id. at 439 n.2 (citations omitted). However, this statement does

not answer either (1) whether the Deatons’ remittance is one that

is “governed by a ‘deemed paid’ provision akin to § 6513(b)” or (2)

what the proper treatment is of remittances that are not “governed

by a ‘deemed paid’ provision.” The Deatons’ position is that a

remittance accompanying Form 4868 is not a remittance governed by

a deemed paid provision and that remittances not governed by a

deemed paid provision are subject to the facts-and-circumstances

test established in Rosenman.10 We take up this issue in subpart 4

10
The Deatons also complain that Baral’s application to their
case should be limited because the Mercantile National Bank rule
was the law at the time they made their $125,000 remittance.
However, we are not free to disregard Baral just because it was not

15
below.

Post-Baral, ours is the only circuit to have addressed the

deposit-payment distinction. In Harrigill v. United States, 410

F.3d 786 (5th Cir. 2005), we addressed facts similar to the instant

facts and held that the pre-assessment remittance at issue was a

payment, not a deposit. Harrigill, like the Deatons, had filed a

Form 4868 for the 1994 tax year and had submitted it with a

remittance of the amount of tax she estimated to be due, which was

later determined to be overstated. Id. at 787. Unlike the Deatons,

however, Harrigill filed her tax return for 1994 within the

limitations period, and the IRS duly credited her overpayment to

her estimated taxes for the 1995 tax year, the return for which she

had not yet filed. Id. at 787-88. When Harrigill later filed her

1995 return and found that she had again overestimated her tax

liability, she sought to have the overpayment--which resulted from

application of the first overpayment to her 1995 taxes--carried

over as a credit for 1996. Id. at 788. The IRS denied Harrigill’s

decided when the events leading to this appeal occurred:
When [the Supreme] Court applies a rule of federal law to the
parties before it, that rule is the controlling interpretation
of federal law and must be given full retroactive effect in
all cases still open on direct review and as to all events,
regardless of whether such events predate or postdate [the]
announcement of the rule.
Harper v. Va. Dep’t of Taxation, 509 U.S. 86, 97 (1993). This
argument is also foreclosed by our panel decision in Harrigill v.
United States, 410 F.3d 786 (5th Cir. 2005), which declined to
treat a pre-assessment remittance as a deposit even though that
remittance would have been treated as a deposit at the time it was
made under our pre-Baral precedent.

16
request as time-barred, a decision we upheld. Id. at 788, 792.

In upholding the IRS’s decision, we did not refute the

parties’ concession that Baral abrogated the Mercantile National

Bank rule, id. at 790 n.6, an abrogation we now expressly

recognize, and we used a facts-and-circumstances approach to

determine whether the credit applied to Harrigill’s estimated taxes

for 1995 was an estimated payment of estimated income tax under

§ 6513(b)(2) subject to Baral’s rule that payments of estimated

income tax are “deemed paid” on the due date of the return without

extension, id. at 791-92. We did not address whether Harrigill’s

original remittance accompanying her Form 4868 application was a

deposit or a payment as a matter of law because we determined that

an application of credit, rather than a Form 4868 remittance, was

at issue. The instant case, however, clearly involves a Form 4868

remittance, and we must now address the question left unanswered in

Harrigill: Is a remittance submitted with a Form 4868 application

for an extension of time to file a payment as a matter of law? Or

is it subject to the facts-and-circumstances test of Rosenman?

After Baral, this is essentially an issue of first impression in

this Circuit; Harden, our prior Form 4868 case, which was based on

Mercantile National Bank, no longer controls.

4. The Deatons’ Remittance

The primary issue in this case is the impact of Baral and

post-Baral law on the deposit–payment distinction. As discussed

17
above, Baral abrogated the rule established in Mercantile National

Bank. And the only post-Baral case to address the deposit–payment

distinction used a facts-and-circumstances test to determine

whether the remittance in question was a payment of estimated

income tax under § 6513(b)(2) subject to Baral’s rule that payments

of estimated income tax are deemed paid on the due date of the

return without extension. Harrigill, 410 F.3d at 791-92. We have

been called on here to decide what rule to apply post-Baral to

characterize a remittance made in conjunction with a Form 4868

application for an extension of time to file. The alternatives

offered are (1) a per se rule that all Form 4868 remittances are

payments and (2) a facts-and-circumstances inquiry that would

require a case-by-case analysis of any Form 4868 remittance made.

Like the Harrigill panel, we find it unnecessary to decide

whether a Form 4868 remittance is a payment as a matter of law

because we find that the Deatons’ remittance of $125,000 in

conjunction with their Form 4868 application for an extension of

time to file constituted a payment of estimated income tax under

§6513(b)(2). We hesitate to adopt a per se rule in a case in which

the record clearly indicates that the taxpayers’ remittance was a

payment, not a deposit, and we therefore decline to do so. We leave

for another day the question of whether all Form 4868 remittances

should be treated as payments of estimated tax, even though we

recognize that several of our sister circuits have already answered

18
this question in the affirmative. See Dantzler v. United States,

183 F.3d 1247, 1251 (11th Cir. 1999); Ertman v. United States, 165

F.3d 204, 207 (2d Cir. 1999); Ott v. United States, 141 F.3d 1306,

1308-09 (9th Cir. 1998); Gabelman v. Comm’r, 86 F.3d 609, 611-12

(6th Cir. 1996); Weigand v. United States, 760 F.2d 1072, 1074

(10th Cir. 1985). We agree with the Tax Court that even under the

facts-and-circumstances approach proposed by the Deatons, their

$125,000 remittance must be considered a payment of estimated tax.

See VanCanagan v. United States, 231 F.3d 1349, 1352-53 (Fed. Cir.

2000). As such, their remittance is “governed by a ‘deemed paid’

provision” and controlled by Baral.

In their 1993 Form 4868, the Deatons indicated that “the

amount [they] exepect[ed]” to list as their 1993 tax liability was

$138,883 and that they had a “balance due” of $125,000. The Deatons

remitted that $125,000. The Deatons submitted no contemporaneous

evidence supporting their contention that they intended this amount

to be a deposit when remitted; there is nothing on the face of the

document or on the check submitted with it indicating such an

intent. There is no evidence that the Deatons made an attempt to

use the IRS procedure for making a deposit. In addition, there is

no evidence suggesting that the Deatons were disputing their tax

liability as in Rosenman. The IRS has always treated their

overpayment as an “excess collection.” At best, the record suggests

that the Deatons had difficulty estimating their tax liability and

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needed more time to file their 1993 tax return. That they had

difficulty estimating their tax liability does not make their

remittance of estimated tax a deposit of the kind recognized by

Baral as retaining legal significance. Baral, 528 U.S. at 439 n.2.

We reject the Deatons’ argument that in light of caselaw

prevailing at the time of their remittance, we must presume that

they intended to make a deposit. This argument requires that we

find that they had actual or presumed knowledge of the prevailing

law of this Circuit. They provide no factual evidence to support

such a finding. Furthermore, the Deatons provide no legal authority

to support their affirmative use of a presumption that a taxpayer

knows the law. Such a presumption is normally reserved to the

government in actions against taxpayers. See, e.g., Cheek v. United

States, 498 U.S. 192, 199 (1991). The Deatons provide no principled

reason for allowing the affirmative use of such a presumption

against the government, and we refuse to invent such a reason here.

We hold that on the facts and circumstances of this case, the

Deatons’ remittance of $125,000 was an “amount paid as estimated

income tax” under § 6513(b)(2), not a deposit.11 Under that

section, a remittance is deemed paid “on the last day prescribed

for filing the return under section 6012 for such taxable

year . . . .” I.R.C. § 6513(b)(2). Because the $125,000 was thus

11
Therefore, like the Baral Court, we need not address the
treatment of remittances not governed by a deemed paid provision.
Baral, 528 U.S. at 439 n.2.

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paid outside the look-back period of § 6511(b)(2)(A), the Deatons

cannot recover their overpayment. I.R.C. § 6511(b)(2)(A).

III. Conclusion

Accordingly, we AFFIRM the Tax Court’s decision.

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