C. L. Edson’s immortal parody of Longfellow’s Hiawatha gives me my text for today’s blogpost, Deborah L. Smith, 140 T. C. 3, filed 2/28/13.
Debs was inside the USA when IRS mailed a SNOD to her P. O. Box in San Francisco, CA, alleging she and husband (unnamed in the opinion and whereabouts not stated) “were liable for an $8,911,858 deficiency, a $2,044,590 section 6651(a)(1) addition to tax, and a $1,782,372 section 6662(a) accuracy-related penalty.” 140 T. C. 3, at p. 3.
The SF PO Box was the address shown on Debs’ most recent return, but Debs split for Canada with her kids and got permanent residency there a couple of months (partitive genitive, guys) before IRS posted the SNOD. However, on the day IRS mailed the SNOD and on the day it hit her PO Box, Debs was back in SF packing up some goods preparatory to shipping them to her new domicile in The True North Strong and Free.
Debs never checks her old PO Box, she claims, but gets wind of the SNOD and petitions Tax Court 148 days after the mailing date of the SNOD. IRS claims a Section 6213(a) late mailing penalty and moves to toss Debs’ petition.
IRS says Debs was inside the USA when they mailed the SNOD, and whether she got it or not is irrelevant, and anyway the 150-day overseas extender only applies to SNODs “addressed to a person outside the United States”. 140 T. C. 3, at p. 5.
Debs says she was a Canadian resident when the notice was mailed and delivered, and therefore is entitled to the 150-day extender for filing a petition.
Judge Foley buys Debs’ tale.
Debs has burden of proof on jurisdiction, and jurisdiction here depends upon a SNOD (which everyone admits there was) and a timely filed petition.
Judge Foley: “The phrase ‘addressed to a person outside the United States’ is ambiguous, and the Court has consistently construed it broadly. See Looper v. Commissioner, 73 T.C. 690, 694 (1980); Lewy v. Commissioner, 68 T.C. 779, 781-782 (1977). Where a statute is capable of various interpretations, we are inclined to adopt a construction which will permit the Court to retain jurisdiction without doing violence to the statutory language. See Lewy v. Commissioner, 68 T.C. at 781, 783-786 (holding that the 150-day rule is applicable to a foreign resident who is in the United States when the notice is mailed, but outside the United States when the notice is delivered); see also Levy v. Commissioner, 76 T.C. 228, 231-232 (1981) (holding that the 150-day rule is applicable to a U.S. resident who is temporarily outside of the country when the notice is mailed and delivered); Looper v. Commissioner, 73 T.C. at 694-695 (holding that the 150-day rule is applicable where a notice is mailed to an address outside the United States); Hamilton v. Commissioner, 13 T.C. 747, 754 (1949) (holding that the 150-day rule is applicable to a foreign resident who is outside the United States when the notice is mailed and delivered). Our holding is consistent with our jurisprudence, is a practical construction of section 6213(a), and leaves the statutory language unscathed.” 140 T. C. 3, at p. 6.
“In sum, a foreign resident’s status as a person ‘outside of the United States’ is not vitiated by the resident’s brief presence in the United States on the notice’s mailing date.” 140 T. C. 3, at p. 9.
Finally, Debs was one of the people Congress wanted to help when they enacted the 150-day extender in Section 6213(a). “She was a Canadian resident (i.e., when the notice was mailed and delivered); was not at the address to which the notice was delivered; and received the notice, in Canada, 127 days after the notice’s mailing date. Although petitioner was in San Francisco when the notice was mailed and delivered, her status as a person ‘outside of the United States’ is largely a function of her residency and is not vitiated by her brief presence in the United States. In short, the 150-day rule is applicable.” 140 T. C. 3, at p. 11.
Judges Thornton, Colvin, Vasquez, Gale, Wherry, Paris and Kerrigan agree; Judge Goeke concurs in result only. Judge Marvel sits this one out, but the Great Dissenter, a/k/a The Judge Who Writes Like a Human Being, Mark V. Holmes, joins Judges Gustafson and Morrison in agreeing with Judge Halpern’s dissent. Judge Halpern’s point is that Debs was inside the USA for two weeks while the SNOD was in the mail and inside her PO Box; she should have checked. But he says it with a lot more words.
Finally, C. L. Edson: “Made he mittens, Mudjekewis/ He, to keep the warm side inside/ Put the skin side inside/ He, to keep the cold side outside/ Put the stout side outside/ Then he turned them inside outside.”