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Tuesday, September 11, 2012

When You Absolutely Positively Have to Get it to Tax Court, Don't Use FedEx Third Business Day

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Scaggs v. Commissioner, T.C. Memo. 2012-258 (Sept. 10, 2012):

Respondent mailed a notice of deficiency to petitioners’ last known address on April 8, 2011. The 90th day after respondent mailed the notice was Thursday, July 7, 2011, which was not a legal holiday in the District of Columbia. The petition was received by the Court and filed on July 12, 2011. The envelope in which the petition was received bears a Federal Express (FedEx) U.S. Airbill with handwritten entries dated July 7, 2011 (FedEx Airbill). The delivery service selected on the FedEx Airbill is “Express Saver Third business day”. . . .

Section 6212(a) expressly authorizes the Commissioner, after determining a deficiency, to send a notice to the taxpayer by certified or registered mail. The taxpayer, in turn, has 90 days from the date that the notice is mailed (not counting Saturday, Sunday, or a legal holiday in the District of Columbia as the last day) to file a petition in this Court for a redetermination of the deficiency. The notice was mailed on April 8, 2011, and the 90th day thereafter was Thursday, July 7, 2011, which was not a legal holiday in the District of Columbia. See sec. 7503; Rule 25(b). Therefore, July 7, 2011, was the last date for petitioners to timely file a petition in the Tax Court. However, the petition was not received and filed by the Court until Tuesday, July 12, 2011.

A timely mailed petition may be treated as though it were timely filed. § 7502(a). Thus, if a petition is received by the Court after the expiration of the 90-day period, it is nevertheless deemed to be timely filed if the date of the U.S. Postal Service postmark stamped on the envelope in which the petition was mailed is within the time prescribed for filing.

Petitioners did not use the U.S. Postal Service to send their petition to the Court. Nevertheless, sending a petition by designated private delivery service may also be treated as timely mailing. § 7502(f)(1). ...

In Notice 2004-83, 2004-2 C.B. 1030, the Commissioner updated the list of companies and classes of delivery service that constitute designated private delivery services for purposes of § 7502. Thus, effective January 1, 2005, and insofar as FedEx is concerned, the list of designated private delivery services was as follows: FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2 Day, FedEx International Priority, and FedEx International First. The 2004 notice expressly states that FedEx is not designated with respect to any type of delivery service not expressly identified. Thus, “Express Saver Third business day” service is not a designated private delivery service. See Raczkowski v. Commissioner, T.C. Memo. 2007-72 (holding in part that the timely mailing/timely filing rule of § 7502 does not apply to “UPS Ground” service because such service was not a designated private delivery service under the 2004 notice).

Under these circumstances, we conclude that the petition was not filed within the requisite period prescribed by § 6213(a). Consequently, this case must be dismissed for lack of jurisdiction.

In so holding we acknowledge that the result may appear harsh; however, the Court cannot rely on general equitable principles to expand the statutorily prescribed time for filing a petition. Although petitioners cannot pursue their case in this Court, they are not without a judicial remedy. Specifically, petitioners may pay the tax, file a claim for refund with the IRS, and, if their claim is denied, sue for a refund in the appropriate Federal District Court or the U.S. Court of Federal Claims.

(Hat Tip: Bob Kamman.)

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