T.C. Memo. 1996-523
UNITED STATES TAX COURT
POLLY PAUL McMAHON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 3040-96. Filed November 27, 1996.
Polly Paul McMahon, pro se.
Jordan S. Musen and Amy A. Campbell, for respondent.
MEMORANDUM OPINION
DAWSON, Judge: This case was assigned to Chief Special
Trial Judge Peter J. Panuthos, pursuant to the provisions of
section 7443A(b)(4) and Rules 180, 181, and 183.1 The Court
1
Section references are to the Internal Revenue Code as
amended. Rule references are to the Tax Court Rules of Practice
and Procedure.
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agrees with and adopts the opinion of the Chief Special Trial
Judge, which is set forth below.
OPINION OF THE CHIEF SPECIAL TRIAL JUDGE
PANUTHOS, Chief Special Trial Judge: This matter is before
the Court on the parties' cross-motions to dismiss for lack of
jurisdiction. Respondent contends that this case should be
dismissed on the ground that the petition was not filed within
the 90-day period prescribed in section 6213(a), while petitioner
contends that dismissal should be based on respondent's failure
to issue a valid notice of deficiency as required under section
6212. There being no dispute that we lack jurisdiction over the
petition filed herein, we must resolve the parties' dispute
respecting the proper ground for dismissal.
Background
On or about December 23, 1992, petitioner filed a joint
Federal income tax return with her husband, Terry McMahon, for
the taxable year 1990, listing her address as 2162 Ingleside
Avenue, Macon, Georgia 31204 (the 2162 Ingleside Avenue address).
Petitioner did not file tax returns for the taxable years 1991,
1992, or 1993. In April 1996, petitioner filed joint Federal
income tax returns with Terry McMahon for the taxable years 1994
and 1995, listing her address as 2128 S. Freya, Spokane,
Washington.
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During the period October 1994 through March 1995, Revenue
Agent Charles Caraway conducted an examination concerning
petitioner's tax liability for the taxable years 1991, 1992, and
1993. By letter dated October 12, 1994, Revenue Agent Caraway
invited petitioner to meet with him on October 24, 1994.
Petitioner did not appear for the meeting. After attempting to
contact petitioner by telephone, Revenue Agent Caraway received a
letter from Terry McMahon, purportedly acting as petitioner's
attorney-in-fact, requesting that Revenue Agent Caraway not
communicate with petitioner until after November 15, 1994. That
letter had the 2162 Ingleside address as the return address.
Revenue Agent Caraway made another attempt to arrange a meeting
with petitioner but apparently received no response. In March
1995, Revenue Agent Caraway prepared substitute returns computing
petitioner's tax liability for the years 1991, 1992, and 1993,
closed his file, and forwarded the matter to respondent's
District Director's office in Atlanta, Georgia.
During the period May through November 1995, Revenue Agent
Randie Bodner, then assigned to respondent's collection division
in Macon, Georgia, was responsible for collecting taxes from
petitioner and Terry McMahon for the years 1992 through 1995. On
June 29, 1995, Revenue Agent Bodner made a field visit to the
2162 Ingleside Avenue address and was advised by a receptionist
at that address that the McMahons had moved to a new address on
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Ingleside Avenue. Revenue Agent Bodner proceeded to 2411
Ingleside Avenue where she found Terry McMahon loading a moving
truck. Terry McMahon advised Revenue Agent Bodner that, although
the McMahons were using 2411 Ingleside Avenue as an office, they
were in the process of moving and were trying to find an
acceptable space in a nearby apartment complex. Due to
uncertainty as to where they would be moving, Terry McMahon was
unable to provide Revenue Agent Bodner with a new address but
advised that he would provide her with a forwarding address soon.
Revenue Agent Bodner took a partial financial statement from
Terry McMahon which includes a notation that the McMahons sold
the property located at 2162 Ingleside Avenue. Revenue Agent
Bodner made an appointment for Terry McMahon to visit her office
on July 12, 1995. On July 11, 1995, Terry McMahon advised
Revenue Agent Bodner that he would not be able to attend their
meeting because he would be out of town. Revenue Agent Bodner
did not hear from Terry McMahon again until she located him in
Spokane, Washington, on March 8, 1996. Revenue Agent Bodner had
no contact with Revenue Agent Caraway during the period in
question.
Due to uncertainties as to where the McMahons would be
moving, Terry McMahon arranged to have mail addressed to 2411
Ingleside Avenue forwarded to a private mail box that he opened
with Mail Boxes, Etc., in Macon, Georgia. Terry McMahon planned
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to contact Mail Boxes, Etc., periodically for the purpose of
having such mail forwarded to him at his new location. Mail
Boxes, Etc., moved its facilities from 4524 Forsyth Rd., Suite
201, in Macon, Georgia, to 5962 Zebulon Rd., #201, in the same
city.
On November 15, 1995, respondent mailed a notice of
deficiency to petitioner by certified mail determining
deficiencies in and additions to petitioner's Federal income
taxes for the years and in the amounts as follows:
Additions to Tax
Year Deficiency Sec. 6651(a)(1) Sec. 6654
1991 $59,408 $14,668 $3,387
1992 82,876 20,684 3,613
1993 24,969 6,217 1,041
The notice of deficiency was mailed to petitioner at the 2162
Ingleside Avenue address. On November 16, 1995, the notice of
deficiency was forwarded to 2411 Ingleside Avenue. On November
17, 1995, the notice of deficiency was forwarded to Mail Boxes,
Etc., 4524 Forsyth Rd., Suite 201, Macon, Georgia. On November
22, 1995, the notice of deficiency was forwarded to Mail Boxes,
Etc., 5962 Zebulon Rd., #201, Macon, Georgia. On November 24,
1995, Christie Shackleford, an employee of Mail Boxes, Etc.,
accepted delivery of the envelope bearing the notice of
deficiency.
The envelope bearing the notice of deficiency was eventually
forwarded to petitioner in Spokane, Washington. The record does
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not reflect the date that petitioner personally received the
notice of deficiency.
Petitioner filed a petition for redetermination with the
Court on February 20, 1996. The petition arrived at the Court in
an envelope bearing a U.S. postmark dated February 14, 1996. At
the time the petition was filed, petitioner resided in Spokane,
Washington.
As indicated, respondent filed a Motion to Dismiss For Lack
of Jurisdiction alleging that petitioner failed to file her
petition within the 90-day period prescribed in section 6213(a).
Petitioner filed an objection to respondent's motion to dismiss
alleging that the deficiency notice was not mailed to her correct
last known address, which she identifies as the 2411 Ingleside
Avenue address. Respondent filed a response to petitioner's
objection countering that the deficiency notice was mailed to
petitioner's last known address. Petitioner filed a Motion to
Dismiss for Lack of Jurisdiction on the ground that the notice of
deficiency is invalid.
A hearing was conducted in this case in Washington, D.C.
Counsel for respondent appeared at the hearing and presented
argument in support of respondent's motion to dismiss. Although
petitioner did not appear at the hearing, her position is clearly
articulated in her motion to dismiss, her objection to
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respondent's motion to dismiss, as well as other papers filed
herein.
Discussion
This Court's jurisdiction to redetermine a deficiency
depends upon the issuance of a valid notice of deficiency and a
timely filed petition. Rule 13(a), (c); Monge v. Commissioner,
93 T.C. 22, 27 (1989); Normac, Inc. v. Commissioner, 90 T.C. 142,
147 (1988). Section 6212(a) expressly authorizes the
Commissioner, after determining a deficiency, to send a notice of
deficiency to the taxpayer by certified or registered mail. It
is sufficient for jurisdictional purposes if the Commissioner
mails the notice of deficiency to the taxpayer's "last known
address". Sec. 6212(b); Frieling v. Commissioner, 81 T.C. 42, 52
(1983). If a notice of deficiency is mailed to the taxpayer at
the taxpayer's last known address, actual receipt of the notice
is immaterial. King v. Commissioner, 857 F.2d 676, 679 (9th Cir.
1988), affg. 88 T.C. 1042 (1987); Yusko v. Commissioner, 89 T.C.
806, 810 (1987); Frieling v. Commissioner, supra at 52. The
taxpayer, in turn, has 90 days from the date the notice of
deficiency is mailed to file a petition in this Court for a
redetermination of the deficiency. Sec. 6213(a).
Respondent mailed the notice of deficiency to petitioner on
November 15, 1995. The envelope bearing the petition was
postmarked February 14, 1996, and the petition was filed by the
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Court on February 20, 1996. The 90-day period prescribed in
section 6213(a) for filing a timely petition in this case expired
on Tuesday, February 13, 1996, which date was not a holiday in
the District of Columbia. Given that the petition was neither
mailed nor filed prior to the expiration of the 90-day statutory
period for filing a timely petition, it follows that we lack
jurisdiction over the petition. Secs. 6213(a), 7502; Rule 13(a),
(c); see Normac, Inc. v. Commissioner, supra.
The question presented is whether dismissal of this case
should be premised on petitioner's failure to file a timely
petition under section 6213(a), or on respondent's failure to
issue a valid notice of deficiency under section 6212. Keeton v.
Commissioner, 74 T.C. 377, 379 (1980).
Petitioner contends that the notice is invalid because it
was not mailed to her last known address. Although the phrase
"last known address" is not defined in the Internal Revenue Code
or in the regulations, we have held that a taxpayer's last known
address is the address shown on the taxpayer's most recently
filed return, absent clear and concise notice of a change of
address. Abeles v. Commissioner, 91 T.C. 1019, 1035 (1988); see
King v. Commissioner, supra at 681. In this regard, petitioner
contends that Terry McMahon's conversation with Revenue Agent
Bodner on June 29, 1995, provided respondent with clear and
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concise notice of petitioner's change of address to 2411
Ingleside Avenue.
Considering all the facts and circumstances, we need not
resolve whether respondent was provided with clear and concise
notice of petitioner's change of address. As explained in
greater detail below, we conclude that, even assuming arguendo
that the 2411 Ingleside Avenue address constituted petitioner's
last known address, the notice of deficiency was delivered to
that address without prejudicial delay.
It is well settled that, although a deficiency notice
properly mailed to a taxpayer's last known address provides the
Commissioner with a "safe harbor" under section 6212(b), an
improperly addressed notice is nonetheless valid if the taxpayer
receives actual notice of the Commissioner's deficiency
determination in a timely fashion i.e., without prejudicial
delay. See Mulvania v. Commissioner, 81 T.C. 65, 67-68 (1983)
(erroneously addressed notice is valid under section 6212(a)
where the taxpayer received the notice 16 days after it was
mailed). Consistent with the foregoing, the Court of Appeals for
the Ninth Circuit, the court to which this case is appealable,
observed:
Reading the interrelated sections of the Code as
an integrated whole, it is apparent that the
legislative plan contemplates that actual notice of the
deficiency should be given where such can reasonably be
achieved and that the mailing authorized by section
6212(a) is a means to that end. * * * A mailing that
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effectively results in actual notice is what is
apparently contemplated by the legislative plan.
Clodfelter v. Commissioner, 527 F.2d 754, 756 (9th Cir. 1975),
affg. 57 T.C. 102 (1971).
As previously discussed, respondent mailed the notice of
deficiency to petitioner at 2162 Ingleside Avenue on November 15,
1995. The notice was forwarded to the 2411 Ingleside Avenue
address one day later. However, consistent with Terry McMahon's
directions, all mail addressed to 2411 Ingleside Avenue,
including the notice of deficiency, was forwarded to Mail Boxes,
Etc. Delivery of the envelope bearing the notice was accepted by
an employee of Mail Boxes, Etc., on November 24, 1995. The
notice of deficiency was later forwarded by Mail Boxes, Etc., to
petitioner in Spokane, Washington.
Notwithstanding the circuitous route by which the notice of
deficiency arrived at Mail Boxes, Etc., it is evident that the
mailing of the notice of deficiency to 2162 Ingleside Avenue did
not materially affect the delivery of the notice to petitioner.
The notice was forwarded to and arrived without apparent delay at
2411 Ingleside Avenue, the address which petitioner has
identified as her last known address. See Yusko v. Commissioner,
supra at 810; see also Needham v. Commissioner, T.C. Memo. 1993-
440. The notice was destined to be forwarded again to Mail
Boxes, Etc., even if it had been addressed to petitioner at 2411
Ingleside Avenue. The notice of deficiency was actually received
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at Mail Boxes, Etc., on November 24, 1995--only 9 days after the
notice was mailed.
Although the record does not reveal the exact date that Mail
Boxes, Etc., forwarded the notice of deficiency to petitioner,
such factor would not affect the result in this case. Petitioner
does not dispute that Mail Boxes, Etc., was authorized to accept
delivery of the deficiency notice on her behalf. If Mail Boxes,
Etc., delayed sending the notice of deficiency to petitioner, any
prejudice is attributable to the inaction of her agent. As we
see it, such inaction, like that of a taxpayer who refuses to
accept delivery of a notice of deficiency, would not render the
notice invalid. See, e.g., Erhard v. Commissioner, 87 F.3d 273
(9th Cir. 1996), affg. T.C. Memo. 1994-344; Patmon & Young
Professional Corp. v. Commissioner, 55 F.3d 216 (6th Cir. 1995),
affg. T.C. Memo. 1993-143.
In sum, even assuming arguendo that petitioner's last known
address was 2411 Ingleside Avenue as she contends, we conclude
that the notice of deficiency was delivered to that address
without prejudicial delay. Consequently, we will grant
respondent's Motion to Dismiss for Lack of Jurisdiction and we
will deny petitioner's Motion to Dismiss for Lack of
Jurisdiction.2
2
Although petitioner cannot pursue her case in this Court,
she is not without a remedy. In short, petitioner may pay the
tax, file a claim for refund with the Internal Revenue Service,
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To reflect the foregoing,
An order will be entered
granting respondent's Motion to
Dismiss for Lack of Jurisdiction
and denying petitioner's Motion to
Dismiss for Lack of Jurisdiction.
and, if the claim is denied, sue for a refund in the Federal
District Court or the U.S. Court of Federal Claims. See
McCormick v. Commissioner, 55 T.C. 138, 142 (1970).