Memorandum of Disapproval of Bill for the Relief of Marion S. Symms.

I AM WITHHOLDING approval of H. R. 9765, "For the relief of Mr. Marion S. Symms?'

The bill would provide that, notwithstanding any statutory period of limitation, refund or credit shall be made or allowed to Marion S. Symms, Augusta, Georgia, of any overpayments of income tax for the year 1952, if claim therefor is filed within six months after the date of enactment.

The records of the Treasury Department show that Mr. Symms filed a timely income tax return for 1952 in which he reported as income certain disability payments received by him. At the time the taxpayer filed his return for 1952, the Court of Appeals for the Seventh Circuit had held that such disability payments were excludable from gross income, although the Internal Revenue Service had ruled to the contrary.

On April 1, 1957, the United States Supreme Court decided that disability payments of the type received by the taxpayer were excludable from gross income. On November 6, 1957, more than four and onehalf years after the taxpayer's return for 1952 was filed, the taxpayer filed a claim for refund based upon the excludability of the disability pay received by him in 1952. This claim was rejected because it was filed after the expiration of the three-year period of limitations prescribed by law for the filing of such claims.

The statutory period of limitations, which the Congress has included in the revenue system as a matter of sound policy, is essential in order to achieve finality in tax administration. Moreover, a substantial number of taxpayers paid income tax on disability payments received by them during the period of the Internal Revenue Service ruling that such disability payments were includable in income. To grant special relief in this case, therefore, where a refund was not claimed in the time and manner prescribed by law, would constitute a discrimination against other similarly situated taxpayers and would create an undesirable precedent.

Under the circumstances, therefore, I am constrained to withhold my approval of the bill.

DWIGHT D. EISENHOWER