The facts of the case are as follows, and I have lifted much of this from the Federal Circuit Court of Appeals holding. Mr. Boeri was an Italian citizen who was never a citizen of the United States, never worked in the United States, and never was a resident of the United States. Mr. Boeri was employed by GTE and Verizon for over thirty five years (located in Italy, Brazil, Argentina, and the Dominican Republic). In 2003, Mr. Boeri accepted a voluntary buy out, and received close to $250,000 in two payments in March and August of 2004. In those distributions, Verizon withheld around $70,500 in US income tax withholdings, Social Security tax, and Medicare Tax. There is no dispute that Mr. Boeri was not originally liable for those taxes. In March of 2009, Mr. Boeri filed non-resident income tax returns for 2004, seeking a refund of the taxes withheld by Verizon…And you can imagine where this was headed.Click on the link above for more. I could not state it better than the author, Stephen Olsen; indeed, without even trying, I could state it much worse.
The discussion is really technical, but for a person who may not be subject to the jurisdiction of the U.S. to tax, the discussion could be very important if there is any way that the IRS ends up with that person's money in the guise of a tax.
This is all to emphasize that statute of limitations to pursue claims -- whether in a tax context or otherwise -- are important. Valid claims in any context can be cut off by statutes of limitations. Pay attention.