In the case of United States v. Abel Cosmo Galletti et al., 2003, the Supreme Court ruled in favor of the Internal Revenue Service (IRS) regarding a tax dispute with two California taxpayers who were partners in a business that had failed to pay federal employment taxes. The IRS sought to collect these unpaid taxes from Mr. Galletti and his partner directly as they were liable for their partnership's debts under California law. However, they argued that since the IRS did not assess them individually within three years after their company’s tax return was filed, it could no longer do so due to statute limitations. The court disagreed stating that because an assessment against a general partnership is also binding on its individual partners, there was no need for separate assessments against each partner within any statutory period.

In the dissenting opinion for United States v. Abel Cosmo Galletti et al., Justice Breyer, joined by Justices Souter and Ginsburg, argued that the majority's interpretation of the Internal Revenue Code was incorrect. They believed that a tax assessment against a partnership should not automatically be considered an assessment against individual partners. The dissenting justices pointed out that under federal law, partnerships are treated as separate taxable entities from their partners. Therefore, they contended that any tax liability assessed on a partnership does not necessarily extend to its individual members unless explicitly stated in an additional assessment or legal action taken by the IRS specifically targeting those individuals. In their view, this would mean each partner’s bankruptcy estate is protected from claims based on pre-bankruptcy assessments made only against their respective partnerships.