CSX Corporation v. United States ( 2021 )

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[PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 20-12494
____________________
CSX CORPORATION,
ATLANTIC LAND & IMPROVEMENT COMPANY,
CARROLLTON RAILROAD,
CHESSIE COMPUTER SERVICES, INC.,
CSX INTERMODAL TERMINALS, INC.,
CSX RAIL PAYROLL SERVICES, INC.,
CSX REAL PROPERTY, INC.,
CSX TRANSPORTATION, INC.,
CSX TRANSPORTATION TERMINALS,
CYBERNETICS & SERVICES, INC.,
FRUIT GROWERS DISPATCH, INC.,
FRUIT GROWERS EXPRESS COMPANY,
TOTAL DISTRIBUTION SERVICES, INC.,
TRANSFLO TERMINAL SERVICES, INC.,
Plaintiffs-Appellants,
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2 Opinion of the Court 20-12494
versus
UNITED STATES OF AMERICA,
Defendant-Appellee.
____________________
Appeal from the United States District Court
for the Middle District of Florida
D.C. Docket No. 3:15-cv-00427-BJD-JRK
____________________
Before WILLIAM PRYOR, Chief Judge, LAGOA, Circuit Judge, and
WATKINS,* District Judge.
WILLIAM PRYOR, Chief Judge:
This appeal requires us to decide whether relocation bene-
fits provided by a railroad to its employees are exempt under the
Railroad Retirement Tax Act as “bona fide and necessary expenses
incurred [by the employee] . . . in the business of the employer,” 26
U.S.C. § 3231(e)(1)(iii), and if so, what, if any, substantiation re-
quirements apply. CSX Corporation appeals a summary judgment
in favor of the United States that relocation benefits for its employ-
ees, although incurred in the business of the employer, were not
*Honorable W. Keith Watkins, United States District Judge for the Middle
District of Alabama, sitting by designation.
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20-12494 Opinion of the Court 3
adequately substantiated. The United States argues that the bene-
fits were not incurred in the business of the employer, but if they
were, it requests that we remand to determine which substantia-
tion requirements apply. Because the benefits are bona fide and
necessary expenses incurred by the employee in CSX’s business and
there is no requirement to prove or substantiate anything beyond
compliance with the statute, we affirm in part, reverse in part, and
remand for the district court to calculate the amount of CSX’s re-
fund and to oversee the required notification process.
I. BACKGROUND
CSX and its various subsidiaries operate a network of rail
lines throughout the eastern United States. In so doing, CSX re-
quires its employees to move to different locations because of op-
erational consolidations, mergers, promotions, and other business-
related reasons. CSX chooses to pay for most of the expenses the
relocating employee incurs in moving to the new location. CSX
provides benefits such as long-term storage, temporary housing,
home-sale and purchase costs, a cost-of-living allowance, a
monthly stipend for the duration of the move, career assistance for
the employee’s spouse, and lease cancellation fees. Some of the re-
location benefits are provided in-kind through third parties, and
some are provided through monetary payments to cover costs ac-
tually or reasonably expected to be incurred by relocating employ-
ees.
When CSX first provided the benefits, it treated the benefits
as taxable compensation under the Railroad Retirement Tax Act.
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4 Opinion of the Court 20-12494
The Act imposes on the employer and employee a tax calculated as
a percentage of the employee’s “compensation.” 26 U.S.C.
§ 3231(e); see generally id. § 3201 et seq. Section 3231(e) defines
compensation as “any form of money remuneration” paid by the
employer to the employee “for services rendered.” Id. § 3231(e)(1).
The Act is similar to the Federal Insurance Contributions
Act, which does not govern railroad companies and their employ-
ees. See Wis. Cent. Ltd. v. United States, 138 S. Ct. 2067, 2071–72
(2018). The railroad company collects the employee’s liabilities by
deducting income from the employee’s paycheck and then remits
both the employee’s and its own portion of the tax to the govern-
ment. 26 U.S.C. § 3202(a)–(b). Some payments are exempt from the
retirement tax, including “amount[s] paid specifically—either as an
advance, as reimbursement or allowance—for traveling or other
bona fide and necessary expenses incurred or reasonably expected
to be incurred in the business of the employer.” Id. § 3231(e)(1)(iii).
In 2009, CSX deducted and paid to the Internal Revenue Ser-
vice approximately $1.76 million in taxes for these relocation ben-
efits. CSX later decided that these benefits were exempt because
they were “advance[s,] . . . reimbursement[s,] or allowance[s] . . .
for traveling or other bona fide and necessary expenses” that were
“incurred or reasonably expected to be incurred” by its employees
“in the business of” CSX. Id. § 3231(e)(1)(iii). The Act limits this ex-
emption to payments “identified by the employer either by a sepa-
rate payment or by specifically indicating the separate amounts
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20-12494 Opinion of the Court 5
where both wages and expense reimbursement or allowance are
combined in a single payment.” Id.
CSX sought a refund of the taxes. After the Service refused,
CSX sued for refunds of these and other taxes paid on behalf of itself
and its employees. In addition to the taxes on relocation benefits,
CSX sought refunds for taxes paid on stock transactions, which
CSX claimed were not “money remuneration.”
The parties stipulated to the material facts and filed cross-
motions for summary judgment. The district court held that cor-
porate stock and in-kind relocation benefits were “properly consid-
ered” money remuneration by the Treasury Department. And it
held that relocation benefits did not fall under the exemption in
section 3231(e)(1)(iii) because the exemption covered only those
expenses incurred during short-term travel to perform employ-
ment duties.
During the pendency of an appeal by CSX, the Supreme
Court decided that “money remuneration” in the Act did not apply
to in-kind benefits, but instead applied only to compensation that
is a commonly used “medium of exchange.” Wis. Cent., 138 S. Ct.
at 2074. The government conceded on appeal that CSX’s stock
transactions were not subject to the Act, but it contested the status
of CSX’s relocation benefits. CSX Corp. v. United States, 909 F.3d
366, 368 (11th Cir. 2018) (CSX I ).
We agreed that corporate stock was not “money remunera-
tion” and reversed the district court on that issue, but we did not
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6 Opinion of the Court 20-12494
address whether in-kind relocation benefits were “money remu-
neration.” Id. at 368–69. On the issue of cash relocation benefits,
“we [held] that relocation benefits and moving expenses that com-
port with the statutory requirements of [section] 3231(e)(1)(iii) are
excluded from taxable compensation under the [Act].” Id. at 369.
Because “[w]hether CSX complied with these statutory require-
ments [was] outside the scope of [the] decision,” we “remand[ed]
for further consideration of the statutory requirements” and refund
calculations. Id.In a concurring opinion, Judge Jordan reiterated that “[r]elo-
cation benefits . . . fit comfortably within this broad provision [sec-
tion 3231(e)(1)(iii)].” Id. at 370 (Jordan, J., concurring). Judge Jordan
explained that he disagreed with an interpretation of the same sec-
tion in BNSF Railway Co. v. United States, 775 F.3d 743, 758–59
(5th Cir. 2015). In CSX I, the government argued that the Fifth Cir-
cuit’s interpretation of section 3231(e)(1)(iii) properly considered
section 3231(e)(5)—which exempts all money remuneration if it is
reasonable to believe that an employee could deduct that benefit
from his income, including certain moving expenses—as a specific
limitation on the general exemption and as potentially superfluous
under CSX’s interpretation. CSX I, 909 F.3d at 370 (Jordan, J., con-
curring). The Fifth Circuit concluded that those considerations
constrained the scope of section 3231(e)(1)(iii) to “payments to em-
ployees for traveling expenses and bona fide and reasonable ex-
penses related to travel.” BNSF Ry., 775 F.3d at 759.
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20-12494 Opinion of the Court 7
Judge Jordan rejected BNSF Railway’s interpretation for
three reasons. First, the text of the statute was unambiguous and
required no application of the general-specific or superfluity can-
ons: “[t]he terms ‘traveling,’ ‘bona fide,’ and ‘necessary’ may be
broad, but they are not vague.” CSX I, 909 F.3d at 371 (Jordan, J.,
concurring). Second, section 3231(e)(5) was enacted nearly eight
years after section 3231(e)(1)(iii), compare Act of Oct. 18, 1976,
Pub. L. No. 94-547, § 4(b), 90 Stat. 2526 (section 3231(e)(1)(iii)),
with Tax Reform Act of 1984, Pub. L. No. 98-369, § 531(d)(2), 98
Stat. 884 (section 3231(e)(5)), and the cross references in section
3231(e)(5) did not include moving expenses for another nine years,
see Omnibus Budget Reconciliation Act of 1993, Pub. L. No. 103-
66, § 13213, 107 Stat. 473–74. So, Judge Jordan reasoned, section
3231(e)(1)(iii) could not have referred to a section—3231(e)(5)—
that did not exist at the time of enactment. CSX I, 909 F.3d at 371
(Jordan, J., concurring). And it would be erroneous to assume that
Congress later implicitly repealed section 3231(e)(1)(iii) when the
two sections did not completely overlap. Id. at 371–72; accord
ANTONIN SCALIA & BRYAN A. GARNER, READING LAW: THE
INTERPRETATION OF LEGAL TEXTS § 55, at 327 (2012) (“Repeals by
implication are . . . very much disfavored. But a provision that
flatly contradicts an earlier-enacted provision repeals it.” (internal
quotation marks omitted)). Third, by separating the exemption of
relocation benefits from deductibility, Congress enabled itself to
suspend the deductibility of moving expenses without affecting the
exemption of relocation benefits. CSX I, 909 F.3d at 372 (Jordan, J.,
concurring) (citing Act of Dec. 22, 2017, Pub. L. No. 115-97,
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8 Opinion of the Court 20-12494
§ 11048, 131 Stat. 2088 (suspending the moving expense deduction
for tax years 2018–25)).
On remand, the parties again filed cross-motions for sum-
mary judgment. The government conceded that in-kind relocation
benefits were not “money remuneration.” The parties continued
to dispute whether cash relocation benefits were exempt under sec-
tion 3231(e)(1)(iii). The district court concluded that most of the
relocation benefits provided were for “bona fide and necessary ex-
penses incurred or reasonably expected to be incurred in the busi-
ness of the employer.” 26 U.S.C. § 3231(e)(1)(iii). But the quick-sale
bonuses provided by CSX—an extra amount given to employees
who sold their homes quickly—did not fall within the exception.
CSX does not challenge this determination on appeal.
The district court then addressed whether CSX had substan-
tiated these amounts to qualify for the exemption. It rejected CSX’s
argument that the only requirement was that the amount be paid
in a “separate payment” or that there be a specific indication of “the
separate amounts.” See id. Instead, it applied the Accountable Plan
Regulation. See 26 C.F.R. § 162-2; id. § 31.3121(a)-3 (incorporating
the requirements of the Accountable Plan in section 162-2).
Through a general grant to the Secretary of the Treasury to make
“all needful rules and regulations for [] enforcement,” 26 U.S.C.
§ 7805(a), and a cross-reference to section 31.3121(a)-3, 26 C.F.R.
§ 31.3231(e)-1(a)(5), the district court concluded that the Account-
able Plan applied to the amounts at issue. The district court then
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20-12494 Opinion of the Court 9
ruled that CSX failed to meet regulatory substantiation require-
ments in the Accountable Plan.
CSX and the government filed a joint motion to issue a final
judgment under Federal Rule of Civil Procedure 54(b). The judg-
ment could not otherwise become final until CSX had comported
with regulatory requirements involving the collection of refunds
on the tax paid for in-kind relocation benefits on behalf of its em-
ployees—the most relevant of which requires notifying each em-
ployee of the refund amount and requesting consent for CSX to
collect it on his behalf. See id. § 31.6402(a)-2; Rev. Proc. 2017-28,
2017-14 I.R.B. 1061. The district court agreed that the in-kind relo-
cation benefits were separate from the cash relocation benefits and
stock transactions. It further concluded that there was “no just rea-
son for delay,” FED. R. CIV. P. 54(b), because the potential cost of
notifying the employees twice—once for the in-kind relocation
benefits and once for the cash relocation benefits—outweighed the
small risk of a second appeal about the precise refund amount and
notification procedures. The district court issued the final judg-
ment for the stock transactions and another for the cash relocation
benefits.
II. STANDARD OF REVIEW
This Court reviews summary judgment orders de novo,
“viewing all the evidence and [drawing] all reasonable inferences
in favor of the non-moving party.” McKenny v. United States, 973
F.3d 1291, 1296 (11th Cir. 2020). Summary judgment is appropriate
when “there is no genuine issue as to any material fact, such that
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10 Opinion of the Court 20-12494
judgment in favor of one party is appropriate as a matter of law.”
Id. (citing FED. R. CIV. P. 56(a)).
III. DISCUSSION
As a preliminary matter, the parties dispute whether our de-
cision in CSX I resolved the two issues in this appeal: whether the
moving expenses were incurred in CSX’s business and what, if any,
substantiation requirements are applicable. Our mandate rule and
the law-of-the-case doctrine bar relitigation of issues resolved ex-
plicitly or by necessary implication in an earlier appeal. Norelus v.
Denny’s, Inc., 628 F.3d 1270, 1288 (11th Cir. 2010). In CSX I, we
remanded “for further consideration of the statutory requirements
and the calculation of CSX’s taxable compensation.” 909 F.3d at
369. So, we did not resolve the issues presented in this appeal.
We divide our discussion in two parts. First, we explain that
the text of section 3231(e)(1)(iii) includes CSX’s relocation benefits
because its employees incurred the expenses in their employer’s
business. Second, we explain that CSX and its employees do not
need to meet any regulatory substantiation requirements.
A. Section 3231(e)(1)(iii) Includes Relocation Benefits for Em-
ployees Whose Employers Require Them to Move.
The parties dispute whether the relocation benefits paid by
CSX are for “bona fide and necessary expenses” incurred by the
employee “in the business of the employer.” 26 U.S.C.
§ 3231(e)(1)(iii). CSX argues that the plain language of the Act in-
cludes expenses incurred by an employee who relocates at the
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20-12494 Opinion of the Court 11
behest of his employer. The district court agreed; it reasoned that
the expenses were necessary and incurred in good faith “in carrying
out the business of the employer, i.e. moving from one area to an-
other to perform a job function for CSX.” The government argues
that the historical context in which section 3231(e)(1)(iii) was en-
acted establishes that Congress intended to tie its meaning to the
meanings of another provision in the Internal Revenue Code and
of then-existing Treasury Regulations, which exclude the benefits
here. We agree with CSX.
“[W]e start with the text.” White v. Lemma, 947 F.3d 1373,
1377 (11th Cir. 2020); see also SCALIA & GARNER, supra § 2, at 56
(“The words of a governing text are of paramount concern . . . .”).
The text must be interpreted “consistent[ly] with [its] ordinary
meaning at the time Congress enacted the statute.” Wis. Cent., 138
S. Ct. at 2070 (alterations adopted) (internal quotation marks omit-
ted). The Act exempts certain payments for expenses to employees
from taxable compensation:
[A]n amount paid specifically—either as an advance,
as reimbursement or allowance—for traveling or
other bona fide and necessary expenses incurred or
reasonably expected to be incurred in the business of
the employer provided any such payment is identified
by the employer either by a separate payment or by
specifically indicating the separate amounts where
both wages and expense reimbursement or allowance
are combined in a single payment.
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12 Opinion of the Court 20-12494
26 U.S.C. § 3231(e)(1)(iii). The government does not dispute that
the payments by CSX for relocation expenses took the form of “an
advance, . . . reimbursement[,] or allowance” or that the payments
were properly identified as required by the statute. It argues instead
that the relocation benefits paid by CSX were not for “bona fide
and necessary expenses” incurred by the employee “in the business
of the employer.” Id.The text of the statute is unambiguous. A “bona fide” ex-
pense is one incurred in good faith. See Comm’r v. Estate of Sand-
ers, 834 F.3d 1269, 1275 (11th Cir. 2016); Bona Fide, BLACK’S LAW
DICTIONARY (rev. 4th ed. 1968) (“In or with good faith; . . . without
deceit or fraud.”). And in this context, “necessary” does not mean
strictly needed but instead means only that “the expense [is] appro-
priate and helpful.” Comm’r v. Tellier, 383 U.S. 687, 689 (1966) (in-
ternal quotation marks omitted); see also Necessary, BLACK’S LAW
DICTIONARY (rev. 4th ed. 1968) (“This word . . . may import abso-
lute physical necessity or inevitability, or. . . that which is only con-
venient, useful, appropriate, suitable, proper, or conducive to the
end sought.”). The payments also correspond to expenses incurred
by employees in the business of their employer.
We reject the government’s argument that the expenses at
issue are personal expenses as opposed to expenses incurred in
CSX’s business. When employees are required to travel for busi-
ness, expenses for hotels are indisputably incurred in their em-
ployer’s business. Hotel expenses are not materially different from
moving expenses incurred when employees are required to
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20-12494 Opinion of the Court 13
relocate for business. CSX’s employees incurred moving expenses
at the direction of their employer because CSX required them to
relocate to continue their employment. And because incurring
those expenses was required to perform services for CSX, the ex-
penses were “incurred . . . in the business of [their] employer.” 26
U.S.C. § 3231(e)(1)(iii). As the district court correctly explained, an
“employee incurs additional expenses when the employee is asked
to relocate.” And although a moving expense might “be a personal
expense under some circumstances,” when a relocation is “circum-
scribed by company regulations, directives, and conditions, [the
moving expense] lose[s] its character as a personal expense and
take[s] on the color of a business expense.” Sibla v. Comm’r, 611
F.2d 1260, 1262 (9th Cir. 1980).
The government urges us to consider not the plain text but
the supposed legislative purpose instead. It argues that the history
of the exemption establishes that Congress intended to tie the
meaning of section 3231(e)(1)(iii) to the meaning of an income-tax
deduction in a separate provision of the Internal Revenue Code,
which “allow[s] as a deduction [from taxable income] all the ordi-
nary and necessary expenses paid or incurred . . . in carrying on any
trade or business.” See 26 U.S.C. § 162(a). Section 162(a) in turn has
been interpreted by the Secretary of the Treasury to exclude the
moving expenses at issue. See 26 C.F.R. § 1.217-2(a)(1).
This argument about “the historical origin” of the tax ex-
emption would require us to ignore the plain meaning of section
3231(e)(1)(iii). To the extent that legislative history is useful at all
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14 Opinion of the Court 20-12494
in statutory interpretation, “we do not consider legislative history
when the text is clear. . . . When the words of a statute are unam-
biguous, . . . judicial inquiry is complete.” Villarreal v. R.J. Reyn-
olds Tobacco Co., 839 F.3d 958, 969 (11th Cir. 2016) (en banc) (in-
ternal quotation marks omitted). The government does not argue
that the plain language excludes the relocation benefits. See, e.g.,
CSX I, 909 F.3d at 370 (Jordan, J., concurring) (“The government
does not dispute that CSX’s relocation benefits are generally bona
fide or necessary.”). In fact, the government mentions the “plain
language” in its brief only when it argues that the text of section
3231(e)(1)(iii) mirrors the text of section 162(a), which governs a
deduction from income taxes. We decline to “resort to legislative
history to cloud a statutory text that is clear.” Villarreal, 839 F.3d at
969 (internal quotation marks omitted).
In addition to using legislative history, the government re-
lies on the consistent-usage canon, which states that a “word or
phrase is presumed to bear the same meaning throughout a text.”
SCALIA & GARNER, supra § 25, at 170. The government argues that
the textual similarities and history require us to interpret section
3231(e)(1)(iii) the same way the Secretary of the Treasury has in-
terpreted section 162(a). But the consistent-usage canon is inappli-
cable.
The consistent-usage canon applies where the same word or
phrase is used in two separate provisions of the same law. Id. § 25,
at 170–73. It can also extend to two different statutes when the
“timing and purpose” of the two statutes are similar and their text
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20-12494 Opinion of the Court 15
is “materially indistinguishable.” BNSF Ry. Co. v. Loos, 139 S. Ct.
893, 898–99 (2019); see also SCALIA & GARNER, supra § 25, at 173
(“If [the two distinct statutes were] enacted at the same time, and
dealt with the same subject, the argument could even be persua-
sive.”). For example, in BNSF Railway Co. v. Loos, the Supreme
Court applied the consistent-usage canon to corresponding provi-
sions of the Act and the Federal Insurance Contributions Act be-
cause the programs were similar in “timing and purpose.” See 139
S. Ct. at 898–99.
By contrast, sections 3231(e)(1)(iii) and 162(a)—two differ-
ent statutes—were enacted twenty-two years apart. Compare Act
of Oct. 18, 1976, Pub. L. No. 94-547 § 4(b), 90 Stat. 2526 (section
3231(e)(1)(iii)), with Internal Revenue Code of 1954, Pub. L. No.
83-591, § 162, 68A Stat. 45–46 (section 162(a)). And the provisions
deal with different subjects—section 162(a) provides an income-tax
deduction and section 3231(e)(1)(iii) provides an exemption from
withholding. See Cent. Ill. Pub. Serv. Co. v. United States, 435 U.S.
21, 29 (1978) (explaining that income-tax withholding “is not the
same as . . . subjectability to income taxation”); cf. CSX I, 909 F.3d
at 368 (“Congress did not choose to tax [certain benefits under the
Act], even though such benefits are taxed elsewhere in the tax
code.”). Because section 162(a) is not a retirement withholding pro-
vision and was enacted decades before section 3231(e)(1)(iii), the
consistent-usage canon does not apply.
The government finally argues that in enacting section
3231(e)(1)(iii), Congress “tapped into a well-established regulatory
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16 Opinion of the Court 20-12494
framework.” Citing Treasury Regulations from 1944 and 1950, the
government argues that the nearly identical language in those reg-
ulations and section 3231(e)(1)(iii) proves that “Congress essen-
tially adopted” the meaning of the regulations. See 26 C.F.R.
§§ 31.3401(a)-1(b)(2) (income-tax withholding), 31.3121(a)-1(h) (so-
cial security), and 31.3306(b)-1(h) (unemployment tax). The gov-
ernment contends that the only major differences in the language
of the provisions are that section 3231(e)(1)(iii) adds the word “al-
lowance” and omits the word “ordinary.” Because a word or
phrase that is “obviously transplanted from another legal source
. . . brings the old soil with it,” Hall v. Hall, 138 S. Ct. 1118, 1128
(2018) (internal quotation marks omitted), the government urges
us to apply the meaning ascribed to the Treasury Regulations to
section 3231(e)(1)(iii) as well.
The government’s reliance on the old-soil canon is mis-
placed. It is not “obvious[]” that section 3231(e)(1)(iii) was trans-
planted from Treasury Regulations applicable to Social Security ex-
emptions. See Taggart v. Lorenzen, 139 S. Ct. 1795, 1801 (2019).
Recent Supreme Court decisions that have applied this canon in-
volved terms that were plainly transplanted to a new legal text. See,
e.g., id. (concluding that the power of civil contempt was inherent
in the power to issue an injunction because “courts have long im-
posed civil contempt sanctions” to enforce injunctions); Stokeling
v. United States, 139 S. Ct. 544, 551 (2019) (applying the old-soil
canon to the word “force” when retained from one version of the
Armed Career Criminal Act to another); Hall, 138 S. Ct. at 1128
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20-12494 Opinion of the Court 17
(applying the canon to the word “consolidate” when the Federal
Rules of Civil Procedure were “expressly modeled” on their rele-
vant predecessor); see also In re Fed. Bureau of Prisons’ Execution
Protocol Cases, 955 F.3d 106, 116–17 (D.C. Cir. 2020) (Katsas, J.,
concurring) (applying the canon to the word “manner” when car-
ried over in multiple versions of the statute). Here, in contrast, the
Treasury Regulations include the word “ordinary,” but section
3231(e)(1)(iii) does not. See, e.g., 9 Fed. Reg. 14573, 14576 (Dec. 14,
1944) (exempting “[a]mounts paid specifically—either as advances
or reimbursements—for traveling or other bona fide ordinary and
necessary expenses incurred or reasonably expected to be incurred
in the business of the employer” (emphasis added)). And section
3231(e)(1)(iii) includes the word “allowance,” but the Treasury
Regulations do not. Because “a material variation in terms suggests
a variation in meaning,” SCALIA & GARNER, supra, § 25, at 170, we
cannot read the provisions identically under the old-soil canon. See
also Wis. Cent., 138 S. Ct. at 2071 (Courts “usually presume differ-
ences in language . . . convey differences in meaning.” (internal
quotation marks omitted)); cf. Food Mktg. Inst. v. Argus Leader
Media, 139 S. Ct. 2356, 2365 (2019) (“Nor will this Court ordinarily
imbue statutory terms with a specialized common law meaning
when Congress hasn’t itself invoked the common law terms of art
associated with that meaning.”).
We also reject the government’s interpretation because it
excludes all relocation benefits from the scope of section
3231(e)(1)(iii), contrary to both the plain text of the statute and our
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18 Opinion of the Court 20-12494
earlier decision. In CSX I, we concluded that relocation benefits
“that comport with the statutory requirements of [section]
3231(e)(1)(iii) are excluded from taxable compensation under the
[Act].” 909 F.3d at 369. Under the law of the case, at least some
relocation benefits meet the statutory requirements. Respect for
our precedent requires us not to adopt an interpretation of the stat-
ute that would effectively neuter our previous holding. See Kon-
drat’yev v. City of Pensacola, 949 F.3d 1319, 1335 n.1 (11th Cir.
2020) (Newsom, J., concurring) (“[A] healthy respect for the deci-
sions of [our] colleagues . . . counsels a fairly rigorous application
of the prior-panel-precedent rule.”).
The government recognizes the need to identify at least
some relocation benefits that would fall within its proffered inter-
pretation. In its view, section 3231(e)(1)(iii) does cover “amounts a
railroad describes as ‘relocation benefits’” in at least one circum-
stance: A railroad employee works in an office in city A. The rail-
road then requires the employee to move to city B, where the em-
ployee will work mostly from home. Under the government’s in-
terpretation, amounts paid in those circumstances as an advance,
reimbursement, or allowance for home-office equipment such as
“computer equipment, software programs, a desk and chair, pens
and paper, etc.” would count as relocation benefits and would fall
within section 3231(e)(1)(iii).
This argument fails because these payments and expenses
are not “relocation benefits and moving expenses.” CSX I, 909 F.3d
at 369. As the government acknowledges, the payments are for
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20-12494 Opinion of the Court 19
home-office expenses. The government tries to evade this defect
by arguing that what is important is what “a railroad [company]
describes as ‘relocation benefits.’” But CSX I concluded that some
“relocation benefits and moving expenses [can] comport with the
statutory requirements,” id., not some benefits that a “rail [com-
pany] describes” as a relocation benefit. And if only expenses such
as home-office expenses would be exempt, then CSX I would have
affirmed the district court because the record conclusively showed
that none of CSX’s relocation benefits were home-office expenses.
Also fatal to the government’s position, the expenses identi-
fied by the government largely do not fall within section 162(a), the
meaning of which is purportedly linked to the meaning of section
3231(e)(1)(iii). Besides pens and paper, the other home-office equip-
ment has a useful life longer than one year and must be capitalized
and deducted over time under other statutory provisions. See 26
U.S.C. §§ 167, 197. So the home-office expenses the government
identifies would not even fall within its own interpretation of sec-
tion 3231(e)(1)(iii).
To be sure, the conclusion here and in CSX I—that reloca-
tion benefits and moving expenses fall within section
3231(e)(1)(iii)—conflicts with the decision of the Fifth Circuit in
BNSF Railway. See CSX I, 909 F.3d at 370–71 (Jordan, J., concur-
ring). But like our colleague, we do not find the Fifth Circuit’s rea-
soning persuasive. In BNSF Railway, the district court held that the
plain meaning of the text governed and that the expenses need only
be “provided for the employees in connection with employee
USCA11 Case: 20-12494 Date Filed: 11/10/2021 Page: 20 of 26
20 Opinion of the Court 20-12494
relocations required by the business of the employer.” 775 F.3d at
758 (internal quotation marks omitted). The Fifth Circuit reversed
on the ground that “two statutory interpretation canons”—the
general-specific and the rule against superfluities—required a dif-
ferent interpretation. Id. at 759. It “conclude[d] that a more reason-
able interpretation of [section] 3231(e)(1)(iii)” included only “trav-
eling expenses and bona fide and reasonable expenses related to
travel.” Id. We disagree.
The rule against superfluities only applies when “a provision
is susceptible of . . . another meaning” that avoids the superfluity.
SCALIA & GARNER, supra, § 26, at 176. The Fifth Circuit did not ex-
plain why it disagreed with the conclusion of the district court that
the plain meaning included relocation benefits and moving ex-
penses. Nor did it explain why the text of section 3231(e)(1)(iii) was
susceptible to an interpretation covering only short-term travel ex-
penses; it stated only that its reading was a “more reasonable inter-
pretation of [section] 3231(e)(1)(iii).” BNSF Ry., 775 F.3d at 759; but
see Wis. Cent., 138 S. Ct. at 2074 (rejecting the Seventh Circuit’s
reasoning that “it would make good practical sense” to adopt an
interpretation that conflicted with the ordinary meaning (internal
quotation marks omitted)).
We also disagree with the Fifth Circuit’s invocation of the
general-specific canon, which only applies when “conflicting provi-
sions cannot be reconciled—when the attribution of no permissible
meaning can eliminate the conflict.” SCALIA & GARNER, supra, § 28,
at 183. There is no conflict between sections 3231(e)(1)(iii) and
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20-12494 Opinion of the Court 21
(e)(5); “[a]t most, the subsections overlap . . . .” CSX I, 909 F.3d at
372 (Jordan, J., concurring). Section 3231(e)(5) exempts from com-
pensation payments that fall within listed sections of the Internal
Revenue Code, and each of those sections contains numerous pro-
visions. One of the references is to a provision that excludes from
income, among other benefits, a “qualified moving expense reim-
bursement.” 26 U.S.C. § 132(a)(6), (g). The definition of moving ex-
penses in section 132 is narrow and does not include the expenses
here. Id. § 132(g); see also id. § 217(b)(1). But the moving expense
exemption referenced in section 3231(e)(5) is only one provision of
one referenced section, so giving full effect to the ordinary meaning
of section 3231(e)(1)(iii) at most limits the usefulness of some of the
provisions to which section 3231(e)(5) cross-references.
Finally, the government argues that, until recently, no one
considered relocation benefits to fall within the exemption pro-
vided by section 3231(e)(1)(iii). But “[u]ntil [Congress] exercises
[its] power, the people may rely on the original meaning of the
written law.” See Wis. Cent., 138 S. Ct. 2074. Because the district
court correctly found that the expenses at issue are necessary, “in-
curred[] in good faith,” and incurred “in carrying out the business
of the employer,” we hold that the payments are covered by the
exemption in section 3231(e)(1)(iii).
B. Because No Regulatory Substantiation Requirements Ap-
ply, CSX Is Entitled to a Refund.
The district court concluded that the Accountable Plan Reg-
ulation directly applied. It reasoned that the Secretary had the
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22 Opinion of the Court 20-12494
power to “prescribe all needful rules and regulations” to enforce
the provision, 26 U.S.C. § 7805(a), and that it had done so when it
directed that “reimbursement and other expense allowance
amounts” were subject to the Accountable Plan, see 26 C.F.R.
§ 31.3231(e)-1(a)(5); id. § 162-2. The district court then concluded
that the Accountable Plan was reasonable gap filling under Chev-
ron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (1984),
and that CSX failed to satisfy the Accountable Plan’s requirements.
CSX argues that the district court erred. It contends that sec-
tion 3231(e)(1)(iii) required it only to identify or separate the
amounts paid, which it properly did. CSX contends that the statute
is so clear on this matter that if additional regulatory substantiation
requirements did apply—such as requiring receipts for actual ex-
penses incurred from employees—they would be invalid.
The government, for its part, does not defend the ruling that
the Accountable Plan applies here. As the government concedes,
the Accountable Plan applies only to expenses that are deductible
under Title VI of the Internal Revenue Code. See 26 C.F.R.
§ 31.3121(a)-3(a), (b)(1)(ii) (requiring a payment to “meet[] the re-
quirements of section . . . 1.62-2” of the Code of Federal Regula-
tions); id. § 1.62-2(d)(1) (requiring the expenses to be deductible un-
der Title VI). Although some section 3231(e)(1)(iii) expenses are de-
ductible under the provisions in Title VI, the moving expenses here
are not. Instead, the government argues that the Accountable Plan
applies “by analogy” and urges us to remand for the district court
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20-12494 Opinion of the Court 23
to apply the most demanding substantiation rules in the Accounta-
ble Plan.
We decline the invitation to invent a regulatory substantia-
tion requirement. The government’s concession that the Account-
able Plan does not apply dooms its argument. It contends that
“there needs to be a mechanism by which expenses are monitored
and verified unless the Government is forced to accept at face value
any claim that a payment” satisfied the statutory requirements. (In-
ternal quotation marks omitted.) In support, the government relies
on a House Conference Report for a separate bill, enacted nearly
seventeen years after section 3231(e)(1)(iii), that states that income-
tax deductibility of employer-paid moving expenses would be gov-
erned by rules similar to the rules in the Accountable Plan. H.R.
REP. NO. 103-213, at 592 (1993) (Conf. Rep.). The Report, it con-
tends, shows “Congress’s stated desire and expectation that the
[A]ccountable [P]lan rules would be applied by analogy.” But
“[p]ost-enactment legislative history,” which this is, is a “contradic-
tion in terms” and “is not a legitimate tool of statutory interpreta-
tion.” Bruesewitz v. Wyeth LLC, 562 U.S. 223, 242 (2011); accord
Pitch v. United States, 953 F.3d 1226, 1240 (11th Cir. 2020) (en
banc). And even taken at face value, the statement does not require
this Court to create and apply those rules on our own. At best, the
House Report is evidence that some members of Congress (or their
staff) thought the Secretary should promulgate similar rules. That
the Secretary has not done so is dispositive.
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24 Opinion of the Court 20-12494
To the extent the government argues that satisfying some
additional substantiation requirement is inherently necessary to
take advantage of the exemption, that argument too fails. On the
government’s own account, the Accountable Plan did not go into
effect until July 1, 1990, nearly fourteen years after the enactment
of section 3231(e)(1)(iii). See 54 Fed. Reg. 51021-02, 51023 (Dec. 12,
1989). And the section of the Federal Register presenting the pro-
posal acknowledged that “before July 1, 1990, no withholding or
employment tax liability will attach,” noting that “[o]f course, as
under existing regulations, such expenses must be identified either
by making a separate payment or by specifically identifying the sep-
arate amounts.” Id. The government’s argument that some addi-
tional regulatory substantiation rules must attach rings hollow
when the Accountable Plan allowed a grace period during which it
did not impose any additional substantiation requirements.
It is unnecessary to decide whether, as CSX argues, the clar-
ity of the identification requirement in section 3231(e)(1)(iii) pre-
vents the Treasury from promulgating any regulation imposing ad-
ditional requirements, such as regulatory substantiation require-
ments. Chevron deference applies only when “Congress delegated
authority to the agency generally to make rules carrying the force
of law, and the agency interpretation claiming deference was
promulgated in the exercise of that authority.” Gonzales v. Ore-
gon, 546 U.S. 243, 255–56 (2006) (emphasis added) (internal quota-
tion marks omitted). The Supreme Court has explained that the
Secretary of the Treasury has the general but “explicit
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20-12494 Opinion of the Court 25
authorization to prescribe all needful rules and regulations for the
enforcement” of the provisions in the Internal Revenue Code. See
Mayo Found. For Med. Educ. & Rsch. V. United States, 562 U.S.
44, 57 (2011) (internal quotation marks omitted); 26 U.S.C.
§ 7805(a). But it is undisputed that the Secretary has not promul-
gated any rule or regulation that governs the substantiation of the
amounts here.
Without a regulatory substantiation rule applicable to the
expenses at issue, we need not decide whether any such rule would
be consistent with sections 7805(a) and 3231(e)(1)(iii). Regardless of
whether an additional regulatory substantiation requirement is
consistent with these provisions, CSX prevails, and “we are not in
the business of issuing advisory opinions.” United States v. John-
son, 921 F.3d 991, 1003 (11th Cir. 2019) (en banc) (alteration
adopted) (internal quotation marks omitted).
We stated in CSX I that moving expenses must be “substan-
tiated in accordance with the statutory requirements.” CSX I, 909
F.3d at 369. But that statement was imprecise because the statute
itself does not provide specific substantiation requirements, and
that imprecise language understandably confused the parties and
the district court. The identification required by the statute is not
synonymous with substantiation. See Substantiate, BLACK’S LAW
DICTIONARY (11th ed. 2019) (“To establish the existence or truth of
(a fact, etc.) . . . .”); Substantiation, 2 BOUVIER LAW DICTIONARY
(Desk ed. 2012) (“[T]he process of . . . the proof of a thing in issue
by sufficient evidence.” “Substantial proof, or its provision.”).
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26 Opinion of the Court 20-12494
Identification by separate payment or specific indication does not
“establish” that the expenses fell within section 3231(e)(1)(iii). The
district court understandably read CSX I to require application of
some additional substantiation requirements. But there is no appli-
cable regulatory requirement for substantiation. And a longstand-
ing misinterpretation of section 3231(e)(1)(iii) does not give us li-
cense to create one.
IV. CONCLUSION
We AFFIRM IN PART the summary judgment as it pertains
to whether relocation benefits are exempt under section
3231(e)(1)(iii). We REVERSE IN PART the summary judgment as
it pertains to CSX’s need and failure to satisfy the Accountable Plan
Regulation. And we REMAND to the district court for it to calcu-
late the amount of CSX’s refund and administer the notification
process.