Goldberg v. United States, 881 F.3d 529

Plaintiffs (Goldberg, Geitner, Leavitt) were sole owners of a partnership (Fredericksburg) that contracted with Kraft Oil Management; IRS later opened a criminal investigation into the partnership and Kraft principals.
In 2003 plaintiffs settled with the IRS and paid taxes for tax year 1994 after the IRS obtained a statute-of-limitations waiver from a Kraft principal (Valeri); plaintiffs later alleged the waiver and related procedures were invalid under the tax code.
Plaintiffs claim the IRS also failed to provide required partnership notice under 26 U.S.C. § 6223(a) and that they did not discover these defects until 2009.
Plaintiffs never filed formal refund claims with the IRS under 26 U.S.C. § 7422(a); instead they filed suit in federal court in 2012 seeking (1) refund relief under § 7422 and (2) damages under § 7433 for alleged Code violations while assessing liability.
The district court dismissed: refund claims for lack of jurisdiction (failure to exhaust/perfect administrative remedies) and § 7433 claims for failure to state a claim because § 7433 applies only to collection, not assessment, conduct.
The Seventh Circuit affirmed: informal-claim doctrine does not excuse the plaintiffs’ failure to perfect refund claims; § 7433 does not reach alleged assessment errors.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Jurisdiction for refund claims under § 7422: whether plaintiffs’ earlier informal notices suffice without a perfected refund claim	Plaintiffs: prior informal notice and delay in discovery mean formal perfection is unnecessary (informal-claim doctrine should apply)	Government: plaintiffs never filed the required formal refund claims; failure to exhaust/perfect deprives court of jurisdiction	Affirmed dismissal: plaintiffs failed to exhaust/perfect administrative refund claims; informal claim doctrine does not excuse permanent non‑perfection
Availability of damages under § 7433: whether § 7433 covers alleged IRS misconduct in assessing tax liability (not collecting)	Plaintiffs: assessment errors are "in connection with" collection and thus actionable under § 7433	Government: § 7433 is limited to misconduct "in connection with any collection" and does not cover assessment errors; assessment disputes are addressed via refund process	Affirmed dismissal for failure to state a claim: § 7433 does not cover assessment conduct; plaintiffs must pursue refund/assessment remedies under § 7422

United States v. Kales, 314 U.S. 186 (informal claim doctrine permits informal notice to preserve refund claim but requires later perfection)
Greene-Thapedi v. United States, 549 F.3d 530 (7th Cir. 2008) (informal-claim doctrine predicates relief on later correction/perfection)
Gandy Nursery, Inc. v. United States, 318 F.3d 631 (5th Cir. 2003) (assessments do not give rise to a § 7433 claim)
Miller v. United States, 66 F.3d 220 (9th Cir. 1995) (challenge to tax determination is not actionable under § 7433)
Gonsalves v. Internal Revenue Service, 975 F.2d 13 (1st Cir. 1992) (same: § 7433 does not cover assessment errors)
King v. Burwell, 135 S.Ct. 2480 (2015) (statutory gaps or changes to regulatory schemes are not impliedly made by vague language)