King v. Comm'r of Internal Revenue
| Citation | 88 T.C. 1042,88 T.C. No. 58 |
| Decision Date | 23 April 1987 |
| Docket Number | Docket No. 40396-84 |
| Parties | WILLIAM L. KING AND DARLENE E. KING, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent |
| Court | United States Tax Court |
Jayne M. Wessels, for the respondent.
Respondent determined deficiencies in petitioners' Federal income tax and an addition to the tax as follows:
+--------------------------------+
¦Year¦Deficiency¦Sec. 6653(a)1 ¦
+----+----------+----------------¦
¦1978¦$95,533.92¦$4,776.70 ¦
+----+----------+----------------¦
¦1979¦107,465.94¦5,373.30 ¦
+--------------------------------+
The matters presently before us are the parties' cross-motions to dismiss for lack of jurisdiction. Petitioners' motion is premised upon respondent's alleged failure to mail the notice of deficiency to petitioners' last known address in accordance with section 6212(b)(1). Respondent asserts that the Court lacks jurisdiction because petitioners did not timely file their petition as required by section 6213(a).
Some of the facts have been stipulated and are so found. The stipulation of facts and attached exhibits are incorporated by this reference.
Petitioners William L. and Darlene King, husband and wife, resided in Paradise Valley, Arizona, when they filed the petition in this case. Thus, an appeal of this case would lie with the Court of Appeals for the Ninth Circuit.
Petitioners timely filed their Federal income tax returns for 1978 and 1979 with the Internal Revenue Service Center in Austin, Texas (Austin Service Center). 2 At the time the returns were filed, petitioners resided at 7140 Mossvine Drive, Dallas, Texas (the Mossvine Drive address).
In May, 1980, petitioners' 1978 and 1979 returns were selected for examination by the Dallas District Director's office. 3 For each of those two years, petitioners executed separate powers of attorney, appointing T. J. Kreatschman, C.P.A. (Kreatschman) as their representative; both documents reflected the Mossvine Drive address as petitioners' address.
In October, 1980, petitioners moved from Mossvine Drive to 17223 Club Hill Drive, Dallas, Texas (the Club Hill Drive address). On November 4, 1980, petitioners executed another power of attorney for 1978 and 1979, appointing Charles R. Billings (Billings), an attorney, as their representative (in addition to Kreatschman). This power of attorney erroneously stated the Mossvine Drive address to be petitioners' then current address. Kreatschman and respondent's examining agent, Jerrie Hughes (Hughes), agreed to certain adjustments, involving minor dollar amounts, to petitioners' 1978 and 1979 taxes; Kreatschman and Hughes agreed to attempt to subsequently resolve the remaining adjustments which involved substantial amounts. The agreement was reflected in Form 4549 (Income Tax Examination Changes) which was signed by Hughes on February 10, 1981 and by Kreatschman on February 26, 1981. Form 4549 showed petitioners' address to be the Mossvine Drive address.
Petitioners first used their Club Hill Drive address in correspondence with the Internal Revenue Service on April 13, 1981, when petitioners requested an extension of time for filing their 1980 return. The extension was granted, and on June 15, 1981, petitioners' 1980 return was timely filed. Both the application to extend the time for filing and the 1980 return were filed with the Austin Service Center. On several occasions thereafter, the Austin Service Center corresponded with petitioners with respect to their 1978, 1979 and 1980 taxes; all such correspondence was addressed to the Club Hill Drive address. Such correspondence included a correction notice with respect to 1980, dated July 20, 1981, and two statements of adjustment for 1978 and 1979, both dated December 7, 1981.
On August 17, 1981, the Dallas District Director sent petitioners a 30-day letter proposing adjustments for 1978 and 1979 other than as reflected in the previously executed Form 4549. The 30- day letter was sent to petitioners' Mossvine Drive address; it was subsequently forwarded to petitioners' Club Hill Drive address.
On September 17, 1981, Billings, on behalf of petitioners, responded in writing to the 30-day letter. In this letter, Billings protested the proposed adjustments set forth in the 30-day letter. The letter erroneously stated petitioners' address to be the Mossvine Drive address. Several weeks after the protest letter was filed, Billings received a phone call from petitioner William King's secretary informing him that petitioners no longer resided at the Mossvine Drive address, but Billings did not communicate the change in petitioners' address to respondent. The matter was referred to respondent's Appeals Office in Dallas for handling. The Appeals Officer assigned to this matter was Lawrence Dwyer (Dwyer).
The matter giving rise to the proposed adjustments set forth in the 30-day letter related to straddle transactions involving Government securities. Petitioners engaged in these straddle transactions through First Western Government Securities 4 (First Western) and they were but two of many taxpayers who claimed losses from this type of transaction. Respondent considered these transactions as constituting an abusive tax shelter and adopted a nationwide policy of disallowing all losses claimed in transactions with First Western. Because of respondent's unified position, Dwyer and Billings did not meet for negotiation. Rather, Dwyer prepared (in December, 1981) a notice of deficiency which was issued on February 19, 1982. The notice of deficiency was sent by certified mail to petitioners at the Mossvine Drive address, with copies to Kreatschman and Billings.
For convenience, we summarize in the following chart the addresses used in documents and correspondence between respondent and petitioners up to and including the date of issuance of the notice of deficiency:
To continue reading
Request your trial
-
Miller v. Comm'r of Internal Revenue
...even if the notice is not received by the taxpayer. King v. Commissioner, 857 F.2d 676, 681 (9th Cir. 1988), affg. on other grounds 88 T.C. 1042 (1987); Wallin v. Commissioner, 744 F.2d 674, 676 (9th Cir. 1984), revg. and remanding a Memorandum Opinion of this Court; United States v. Zolla,......
-
Ward v. C.I.R.
...744 F.2d 674 (9th Cir.1984); Monge v. Commissioner, 93 T.C. 22 (1989); Fernandez v. Commissioner, 54 T.C.M. 1036 (1987); King v. Commissioner, 88 T.C. 1042 (1987). In some circumstances, this greater diligence might require the IRS to contact the taxpayer's employer, travel agent or those r......
-
Morgan v. Commissioner
...received by the taxpayer. King v. Commissioner [88-2 USTC ¶ 9521], 857 F.2d 676, 681 (9th Cir. 1988), affg. on other grounds [Dec. 43,864] 88 T.C. 1042 (1987); Wallin v. Commissioner [84-2 USTC ¶ 9768], 744 F.2d 674, 676 (9th Cir. 1984), revg. and remanding a Memorandum Opinion of this Cour......
-
Union Texas Int'l Corp. v. Comm'r of Internal Revenue, 15182–94
...is not necessarily imputed from one division to another and citing United States v. Zolla, 724 F.2d 808, 810–811 (9th Cir.1984)), affg. 88 T.C. 1042, 1987 WL 49314 (1987). Furthermore, we find that New Petroleum did not provide respondent with notice of the merger by filing Forms 940 and 94......