Nuttle v. I.R.S.

69 F.3d 548 · Court of Appeals for the Tenth Circuit · 1995

Facts

David and Karen Nuttle sued the IRS to enjoin tax collection and sought damages for unauthorized collection activities, arguing an exception to the Anti-Injunction Act applied and that the IRS recklessly denied their hardship application. The trial court ruled against them, finding no jurisdiction for the injunction and granting summary judgment to the IRS on the damages claim. The Nuttles appealed to the Tenth Circuit.

Issue

Did the trial court correctly determine it lacked subject matter jurisdiction to enjoin tax collection under the Anti-Injunction Act, and did it properly grant summary judgment on the claim for damages for unauthorized collection activities?

Holding

The appellate court affirmed, holding that the Anti-Injunction Act exception did not apply as the Nuttles failed to show the government could not ultimately prevail, and the IRS did not act recklessly in denying the hardship application given the Nuttles' lack of factual support.

Rule

The Anti-Injunction Act (26 U.S.C. 7421(a)) bars suits to restrain tax collection unless the taxpayer proves irreparable injury and that the government cannot ultimately prevail. Damages for unauthorized collection activities (26 U.S.C. 7433) require the IRS to have acted recklessly or with intentional disregard, and a Taxpayer Assistance Order (26 U.S.C. 7811) is discretionary, requiring specific factual hardship from the taxpayer.

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Case brief last reviewed 2026-01-07. Prepared by CaseReader from the published opinion.