Morgan v. Commissioner
| Decision Date | 03 July 1990 |
| Docket Number | Docket No. 20570-87. |
| Citation | 60 T.C.M. 43 |
| Parties | Dana K. Morgan v. Commissioner. |
| Court | U.S. Tax Court |
Jack Elon Hildreth, Jr., 17822 E. 17th St., Tustin, Calif., for the petitioner. Thomas J. Travers, for the respondent.
Memorandum Findings of Fact and Opinion
This case is part of a consolidated group of cases with common issues which were tried during the week of September 18, 1989. At the time of trial, petitioners' attorney filed five separate motions for summary judgment addressing jurisdictional issues with respect to each of the petitioners named in the motions. The focus of the motion in this case concerns whether petitioner received actual notice of respondent's determination, and if so, whether petitioner's attorney was authorized in filing the petition so as to invoke our jurisdiction. Petitioners in each of the other four cases, through their attorney, have abandoned their motions for summary judgment, but may argue the jurisdictional issue when they address the substantive issues in their cases. Petitioner Morgan, however, continues to pursue her motion for summary judgment concerning jurisdiction. Respondent observes, however, that technically this matter should not be considered under a motion for summary judgment because material factual differences exist between the parties. Rule 121;1 Hoeme v. Commissioner [Dec. 32,806], 63 T.C. 18 (1974). Although we agree with respondent's observation that summary judgment is inappropriate here, we will, nevertheless, decide this jurisdictional issue separately and preliminary to consideration of the merits of this case because the outcome of this jurisdictional issue could be dispositive of this case.
The parties entered into a stipulation of facts, along with attached exhibits, all of which are incorporated by this reference. Petitioner's 1983 and 1984 Federal income tax returns were filed on June 18, 1984, and April 15, 1985, respectively. Petitioner's 1983 return reflected the following mailing address:
18377 Beach Blvd #211
Huntington Beach CA 92648
Petitioner's 1984 return reflected the following mailing address:
115 12th St
Petitioner, on February 25, 1986, executed a power of attorney (Form 2484) with respect to her 1980, 1981, 1982, 1983, 1984, 1985, and 1986 Federal income tax returns, naming Jack Elon Hildreth, Jr. (Hildreth), as her representative and that document was received by respondent's Laguna Niguel District Office on March 7, 1986. Petitioner's address was shown on the power of attorney as "115 — 12th Street, Seal Beach, CA 90740." The power of attorney designated Hildreth as petitioner's "attorney-in-fact" and authorized him "to receive confidential information and to perform any and all acts [petitioner] can perform with respect to [the taxable years reflected on the power]."
On April 2, 1987, respondent sent duplicate notices of deficiency for 1983 and 1984 to petitioner at the following addresses: "17822 East 17th Street, Suite 402, Tustin, CA 92686" and "115 112th Street, Seal Beach, CA 90740." Petitioner did not receive either of the notices mailed by respondent. Also, and in accord with the power of attorney requesting copies of notices and other written communications to be sent to petitioner's representative, respondent sent a copy of the above-referenced notices of deficiency to Hildreth. Hildreth received the copy of the notice of deficiency on April 6.
On June 26, 1987, Hildreth mailed a petition to this Court, naming Dana K. Morgan as petitioner. Said petition was filed on June 29, 1987. Hildreth also attached the original of his copy of petitioner's notice of deficiency, dated April 2, 1987. The copy of the notice attached to the petition bears the "115 112th Street" address. The petition is 18 pages long and contains numerous allegations of error and allegations of fact upon which petitioner intended to rely. There were no allegations concerning the jurisdiction of this Court or the validity of the notice of deficiency. Petitioner was not aware that Hildreth had filed a petition and paid the $60 filing fee on her behalf until she received Hildreth's June 26, 1987, telephone call which was followed-up by a letter from Hildreth enclosing copies of the petition and notice of deficiency and requesting reimbursement of the $60 filing fee. Petitioner reimbursed Hildreth for the $60 filing fee.
Petitioner, during the more than 2-year period from the filing of the petition until the time of trial, had not sought to disavow the petition in this case. Even now as she argues that the petition was unauthorized, she has not taken any other affirmative action regarding the petition.2
OpinionWith some exceptions not applicable here, respondent is precluded from assessing and collecting any tax deficiency without first mailing a notice of deficiency under section 6212(a)3 or otherwise notifying the taxpayer of the deficiency. Sec. 6213(a). Pursuant to section 6213(a), within 90 days (or, in some circumstances not applicable here, 150 days) after the mailing of a notice of deficiency, the taxpayer may file a petition with this Court. The mailing of a notice of deficiency in accord with section 6212 tolls the running of the period of limitations on assessment of a deficiency and starts the running of the 90-day period for filing a petition with this Court. See secs. 6503(a)(1) and 6213(a). The mailing of a notice of deficiency also bars assessment and collection during that 90-day period and, if a petition is filed in this Court, bars such assessment and collection until the decision of this Court has become final. Sec. 6213(a). Our jurisdiction in deficiency cases is generally dependent upon respondent's mailing a notice of deficiency to the taxpayer under section 6212 and the timely filing of a petition with this Court under section 6213.4 Frieling v. Commissioner [Dec. 40,284], 81 T.C. 42, 46-47 (1983).
Section 6212(b) guides respondent in determining where to mail the notice of deficiency. Paragraph (1) of section 6212(b) provides, as follows:
(b) Address for Notice of Deficiency.—
(1) Income and gift taxes and certain excise taxes.—In the absence of notice to the Secretary under section 6903 of the existence of a fiduciary relationship, notice of a deficiency in respect of a tax imposed by subtitle A, chapter 12, chapter 42, chapter 43, chapter 44, or chapter 45 if mailed to the taxpayer at his last known address, shall be sufficient for purposes of subtitle A, chapter 12, chapter 42, chapter 43, chapter 44, chapter 45, and this chapter even if, such taxpayer is deceased, or is under a legal disability, or, in the case of a corporation, has terminated its existence.
We have held that the mailing of a notice of deficiency to a taxpayer's last known address under section 6212(b) is a safe harbor assuring respondent that the notice is valid for purposes of section 6212(a). Frieling v. Commissioner, supra. Consequently, a notice that is mailed to the taxpayer's last known address will toll the period for assessment even if the notice is not 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 Court [Dec. 39,861(M)]; United States v. Zolla [84-1 USTC ¶ 9175], 724 F.2d 808, 810 (9th Cir. 1984); DeWelles v. United States [67-1 USTC ¶ 9403], 378 F.2d 37, 39-40 (9th Cir. 1967); Alta Sierra Vista, Inc. v. Commissioner [Dec. 32,649], 62 T.C. 367, 372 (1974), affd. without published opinion 538 F.2d 334 (9th Cir. 1976); Lifter v. Commissioner [Dec. 31,887], 59 T.C. 818, 821 (1973).
The two notices of deficiency which were mailed to petitioner on April 2, 1987,5 were not addressed to petitioner's "last known address" within the meaning of section 6212. Our holding in Abeles v. Commissioner [Dec. 45,203], 91 T.C. 1019, 1035 (1988), establishes the standard for a taxpayer's last known address, as follows:
For purposes of determining whether a notice of deficiency has been properly mailed to the taxpayer's last known address, we now hold that a taxpayer's last known address is that address which appears on the taxpayer's most recently filed return, unless respondent has been given clear and concise notification of a different address. For these purposes, however, we hold that a taxpayer's "most recently filed return" is that return which has been properly processed by an IRS service center such that the address appearing on such return was available to respondent's agent when that agent prepared to send a notice of deficiency in connection with an examination of a previously filed return. * * * [Fn. ref. omitted.]
Considering the facts of this case, the last known address would have been the 115 12th Street address. Respondent, however, mailed one of the notices of deficiency to 115 112th Street per the Form 3877 reflecting the certified mailings on April 2, 1987. The other April 2, 1987, notice was mailed to an address that neither party has contended was petitioner's last known address. Accordingly, respondent failed to mail a notice to petitioner's last known address and does not come within the "safe harbor" of section 6212. Mulvania v. Commissioner [Dec. 40,285], 81 T.C. 65, 70 (1983); Shelton v. Commissioner [Dec. 32,842], 63 T.C. 193, 197-198 (1974).
If a copy of the notice had not been sent to petitioner's attorney (Hildreth), our inquiry would have concluded here. Instead, we have the factual circumstances where the original notices to the taxpayer were either misaddressed and/or not sent to the last known address but where a copy was received by petitioner's representative under the power of attorney. The attorney, for reasons unexplained in this record, did not advise his client of the copy of the notice...
To continue reading
Request your trial