In Uncategorized on 11/01/2011 at 16:56

  Especially when you’re mailing from overseas

So we learn from William J. Quarterman, 2011 T.C. Mem. 258, filed 11/1/11. Quarters was living in Germany when he got into a fracas with IRS over three years’ worth of deficiencies and accuracy penalties, so he gets 150 days to file a petition instead of the standard 90 days for in-country types.

IRS sent Quarters a SNOD to his Wiernsheim, Germany address, stating a last-day-to-respond as October 1, 150 days after the date of the notice, which was dated May 4. But IRS didn’t mail the notice until May 5, so Quarters would have had until October 2. As always with taxes, though, there’s an exception. This exception is that October 2 was a Saturday, so Quarters had until October 4 to file his petition.

Quarters sends his petition on September 27 via Deutsche Post registered mail. The envelope gets no US postmark, but is date-stamped by the intake clerk at Fier Hundert Zweite Strasse, Nord-West, at 8:04 a.m., October 5.

You’re a day late and nineteen thousand dollars short, says IRS, and moves to dismiss. Tax Court orders Quarters to reply; he says he did, but neither Tax Court nor IRS gets Quarters’ reply, so Tax Court dismisses.

Quarters moves to vacate, claiming his petition got to New York on September 29, entering the US Postal Services’ stream and therefore beating the October 4 clock. To supplement his motion, he sends in a letter from an official of  Deutsche Post stating that the petition got to the US September 29.

“Hearsay!” shouts IRS. Likewise caselaw says you must have USPS Track & Confirm data showing entry into the USPS stream if you don’t have a postmark, and Quarters has neither.

Special Trial Judge Armen takes up the story: “Although timely mailing is generally determined by the U.S. Postal Service postmark date, see sec. 7502(a); sec. 301.7502-1(c)(1), Proced. & Admin. Regs., extrinsic evidence is admissible if a U.S. Postal Service postmark date is either illegible or missing, see Mason v. Commissioner, 68 T.C. 354 (1977); Sylvan v. Commissioner, 65 T.C. 548 (1975).” 2011 T.C. Mem. 258, at p. 7.

But there’s no USPS postmark and no USPS Track & Confirm to prove when the petition got into the USPS’s stream, and the Deutsche Post letter is hearsay.

STJ Armen isn’t dismayed by such small details. “However, in view of the fact that the envelope was clocked in by the Court’s Intake Section at 8:04 a.m. on Tuesday, October 5, 2010, it follows perforce (and not by conjecture or through evidence aliunde) that the petition must have been deposited with the domestic mail service of the U.S. Postal Service no later than Monday, October 4, 2010. See Sylvan v. Commissioner, supra at 551 (“It is impossible for an item to arrive via mail early in the morning on the same day it is mailed”); cf. Lundy v. Commissioner, T.C. Memo. 1997-14.” 2011 T.C. Mem. 258, at p. 9 [Footnotes omitted.]

We can all vouch for the truth of the Sylvan statement.

So Quarters’ petition is reinstated, and he can try to prove IRS wrong.

Takeaway- Three cheers for the hard-working intake clerks at 400 Second Street, N.W., who are on the job and stamping away by dawn’s early light, to give ex-pats like Quarters and the rest of us local nationals our day in Court.


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