Georgia taxed retirement benefits paid by the Federal Government, but exempted those paid by the State, until this Court held, in 1989, that such a scheme violates the Federal Constitution. Georgia then repealed its state retiree tax exemption, but did not offer federal retirees refunds for the unconstitutional taxes they had paid before the Courts 1989 decision. Petitioner Reich, a federal retiree, sought redress under a Georgia statute requiring refunds of "illegally assessed" taxes. In affirming the state trial courts denial of such relief, the State Supreme Court held that the refund statute does not apply where the law under which the taxes were assessed and collected was itself subsequently declared to be invalid. It then denied Reichs petition seeking reconsideration under McKesson Corp. v. Division of Alcoholic Beverages and Tobacco, Fla. Dept. of Business Regulation, 496 U.S. 18, and similar cases, which establish that due process requires a "clear and certain" remedy for taxes collected in violation of federal law, and that a State may provide that remedy before the disputed taxes are paid (predeprivation), after they are paid (postdeprivation), or both. Reich petitioned for certiorari, and this Court remanded for further consideration in light of Harper v. Virginia Dept. of Taxation, 509 U.S. _, which had relied on McKesson in circumstances similar to this case. In again denying Reichs refund claim, the State Supreme Court reviewed Georgias predeprivation remedies and found those remedies to be "ample."

Held:

The Georgia Supreme Court erred in relying on Georgias predeprivation remedies to deny relief. Although due process, under McKesson, allows a State to maintain a remedial scheme that is exclusively predeprivation, exclusively postdeprivation, or a hybrid, Page II and to reconfigure its scheme over time to fit changing needs, it may not do what Georgia did here: "bait and switch" by reconfiguring, unfairly, in midcourse. Specifically, Georgia held out what plainly appeared to be a "clear and certain" postdeprivation remedy, its tax refund statute, and then declared, only after Reich and others had paid the disputed taxes, that no such remedy exists. In this regard, the State Supreme Courts reliance on predeprivation procedures was entirely beside the point (and thus error), because even assuming the constitutional adequacy of those procedures - an issue not here addressed - no reasonable taxpayer would have thought that they represented, in light of the apparent applicability of the refund statute, the exclusive remedy for unlawful taxes. Cf. NAACP v. Alabama ex rel. Patterson, 357 U.S. 449. The case is remanded for the provision of meaningful backward-looking relief consistent with due process and the McKesson line of cases. Pp. 4-7.

263 Ga. 602, 437 S.E.2d 320, reversed and remanded.

OCONNOR, J., delivered the opinion for a unanimous Court. [ REICH v. COLLINS, ___ U.S. ___ (1994), 1]

JUSTICE OCONNOR delivered the opinion of the Court.

In a long line of cases, this Court has established that due process requires a "clear and certain" remedy for taxes collected in violation of federal law. Atchison, T. & S. F. R. Co. v. OConnor, 223 U.S. 280, 285 (1912) (Holmes, J.). A State has the flexibility to provide that remedy before the disputed taxes are paid (predeprivation), after they are paid (postdeprivation), or both. But what it may not do, and what Georgia did here, is hold out what plainly appears to be a "clear and certain" postdeprivation remedy and then declare, only after the disputed taxes have been paid, that no such remedy exists.

For many years, numerous States, including Georgia, exempted from state personal income tax retirement benefits paid by the State, but not retirement benefits paid by the Federal Government (or any other employer). In March 1989, t