In Uncategorized on 03/26/2015 at 16:58

That’s Judge Morrison’s admonition to the trusty CPA who sent in the appeal for Olin Glenn Smith, 2015 T. C. Memo. 60, filed 3/26/15.

Except that on a trial of whether said trusty CPA actually mailed the letter which embodied the appeal, said trusty CPA came off second-best. And this is a contest where there is no second-place winner.

The issue, of course, is whether OG had a chance to contest the underlying liability and, having had same, blew the sixty-day cutoff. So this is a TFRP, where the Letter 1153, if received, starts the clock.

Everyone agrees OG got the Letter 1153 and handed it to his trusty CPA. Trusty CPA claims he wrote to the IRS examiner designated in the Letter 1153 to deal with, stating therein that OG had bailed from the partnership that owed the TFRPs in the year prior to periods in question, and handed it to an office assistant to mail.

But: two years go by, IRS proposes to levy upon OG for $36K, and trusty CPA fires off letters and faxes, and claims he called IRS examiner who never returned his calls. Trusty CPA files another appeal letter, but doesn’t suggest collection alternatives, wanting to contest the liability.

Appeals claims, “you had your chance and blew it.” Judge Morrison agrees.

Though OG’s attorney has some other arguments, he saves them until his answering brief (too late), and anyway he stipulated on the record that, if he lost on whether trusty CPA actually sent letter, OG had his chance and blew it.

I’ve said it so many times: there but for the grace of you-know-Whom goes any one of us. So no gloating here.

Judge Morrison gives the preponderance-of-evidence lecture, so burden of proof is off the table.

Then comes the nub: “In evaluating the question of whether the … letter [the appeal] was actually sent…, we consider [CPA’s] testimony that he gave the letter to his ‘staff for processing and sending to Treasury.’ While this testimony is relevant, we have little idea of how [CPA’s] firm processed [CPA’s] outgoing letter. We did not hear firsthand testimony, for example, from the staff member who would have handled and effected the mailing of the… letter. We therefore are not inclined to presume, on the basis of petitioner’s suggestion of the reliability of [CPA’s] firm’s system for processing outgoing mail, that the … letter in question was actually deposited into the U.S. mail for delivery to the addressee. Furthermore, what little evidence there is about what happened to the letter after [CPA] signed it indicates that the letter was not sent. [CPA] testified that no certified or registered mail receipt for the letter was found in his files at his firm. Had the … letter been sent to the IRS as [CPA] mentioned, most likely it would have been sent by certified or registered mail. We infer this from the importance of the letter and from the fact that [CPA] and his firm searched for a copy of a certified or registered mail receipt. We further believe that had any certified or registered mail receipt existed, [CPA] would have instructed, and his firm’s staff would have understood, that this receipt should be retained in [CPA’s] files. Therefore, the lack of such a receipt in [CPA’s] files is an indication that the letter was not mailed.” 2015 T. C. Memo. at pp. 17-18. (Footnotes omitted).

IRS says “no have”, but admits it hasn’t searched every file. However, OG’s counsel doesn’t ask for adverse inference, so Judge Morrison doesn’t draw one.

And although CPA faxed a copy of the letter to IRS long after the sixty days had run, nothing showed whether it was a retained copy or the original that never got mailed.

I know that in a high-volume office it’s not possible to track every piece of paper. But there are times when the cost of tracking is far less than the cost of not tracking.

Takeaway–Find a post office with a self-service machine, and run your certified mail through that. Keep every receipt, and use USPS online Track & Confirm.


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