WASHINGTON, DC – Dozens of retired United Airlines pilots have been denied claims for FICA tax refunds after a federal appeals court ruled they missed strict statutory deadlines and lacked entitlement under current tax law.
On October 23, 2025, the U.S. Court of Appeals for the Federal Circuit upheld the U.S. Court of Federal Claims’ decision to dismiss the pilots’ lawsuits. The case involved multiple pro se plaintiffs, including James H. Biestek and others, who sought refunds for employment taxes they paid on retirement benefits they never received due to the airline’s bankruptcy and termination of its nonqualified deferred compensation plan.
The court found the pilots failed to timely file refund claims with the IRS as required under 26 U.S.C. § 6511(a), which sets firm deadlines that courts have held to be jurisdictional. The judges stated that unless Congress or the Supreme Court changes the law, equitable exceptions cannot be applied.
The plaintiffs argued that because they stopped receiving retirement payments after United’s plan collapsed, they were entitled to partial FICA refunds. The court disagreed, reaffirming that FICA tax on such deferred compensation is assessed once, based on the present value of expected benefits when they begin, even if the payments are later interrupted or terminated.
The Federal Circuit also rejected constitutional claims, including due process arguments, stating the IRS had acted within its statutory authority when collecting taxes.
Only 19 of the appellants were formally recognized in the ruling due to signature and filing issues. The decision follows similar outcomes in related cases, including Koopmann and Royall, and precedes a pending case, Beavis v. United States.
The Federal Circuit’s opinion leaves no room for refund recovery under current law, despite the pilots’ assertion that the system is unfair when retirement promises collapse through no fault of the employee.
No costs were awarded.
