Attorney-at-Law

NEITHER EQUITY NOR DESIGNATION

In Uncategorized on 06/02/2016 at 17:39

But Octavia saves the day for Felix Guralnik, 146 T. C. 15, filed 6/2/16.

Felix gets an assist via a brief amicus from the Harvard Federal Tax Clinic. I guess Ted Cruz wasn’t in that part of the law school; but this is a non-political blog.

And Octavia isn’t a person. Octavia is a snowstorm that shuttered the doors at 400 Second Street, NW, on February 17 last year. And February 17 was the last day for Felix to petition from the NOD that bounced Felix’s CDP.

Unhappy Felix (Felix is Latin for “happy,” btw) used FedEx First Overnight to deliver said petition to the Glasshouse. And y’all will recall my blogpost “Bless ‘Em All,” 10/14/14, wherein I asked IRS to enlarge the list of the Blessed Overnighters.

FedEx First Overnight was not then among the blessed communion, fellowship divine. It did make the team three months after Felix sent in the petition, but Back to the Future doesn’t work in Tax Court. So Felix handing the packet to the person in purple and black within the thirty-day window availed him not, as far as Section 7502 mailed-is-filed is concerned.

The Judge With a Heart, STJ Armen, got IRS’s motion to dismiss for want of jurisdiction, and, true to form, denied it. See my blogpost “Blow, Blow, Thou Winter Wind – Part Deux,” 8/24/15.

IRS disagreed, and threw the challenge flag.

Judge Lauber, writing for the unanimous Court, upholds the ruling on the field. I wonder if IRS gets charged a time out.

“Civil Rule 6(a)(3)(A) provides that, ‘if the clerk’s office is inaccessible * * * on the last day for filing * * * , then the time for filing is extended to the first accessible day that is not a Saturday, Sunday, or legal holiday.’  Rule 25(a) of our Rules, dealing with computation of time, does not address how time shall be computed when the Clerk’s Office is inaccessible.  Rule 1(b) of our Rules does, however, provide:  “Where in any instance there is no applicable rule of procedure, the Court or the Judge before whom the matter is pending may prescribe the procedure, giving particular weight to the Federal Rules of Civil Procedure to the extent that they are suitably adaptable to govern the matter at hand.” 146 T. C. 15, at p. 4.

There is no drop-box at 400 Second Street, NW. And petitions can’t be filed electronically.

So the Glasshouse was in fact “inaccessible.”

Harvard wants to claim equitable extension, but they cite to Article III court authority. Poor l’il ole Tax Court is an Article I court, which lives and moves and has its being through an act of Congress. The thirty-day barrier cannot be moved one nanometer by all of Harvard’s piety and wit; it’s got Tax Court holdings going back to 1924 butressing.

Harvard isn’t through. First Overnight is a better service than the previously-blessed ones, so it should be deemed blessed, even though Doug Shulman missed that one.

Judge Lauber is unimprerssed.

“Although petitioner’s argument has some common-sense appeal, we are unable to accept it.  Our prior opinions held the ‘timely mailed, timely filed’ rule unavailable, not because the private delivery service the taxpayer used was somehow inferior, but because that service had not been ‘designated by the Secretary.’  Sec. 7502(f).  The fact that a new service is more expedited than a previously-designated service, while perhaps important to the customer, is not dispositive for the Secretary.  For example, the Commissioner requires, as a condition of designation under section 7205(f)(2), that ‘[t]he delivery service offered must provide for delivery to all street addresses within the United States to which documents and payments subject to § 7502 must be sent.’  Rev. Proc. 97-19, sec. 4.04, 1997-1 C.B. at 645.  No matter how fast and expensive a new service is, the Secretary may decline to designate it under section 7502(f) if it does not satisfy this (and other specified) requirements.” 146 T. C. 15, at pp. 17-18.

Well, says Harvard, make the later designation of First Overnight retroactive. As Professor Tom Lehrer sang, “Fight Fiercely Harvard, Fight, Fight, Fight.”

No, says Judge Lauber, Section 7508 says when the Sec’y decides on retroactivity, and here he didn’t.

And the shutdown of DC for Octavia wasn’t a “legal holiday,” because the Mayor made an executive order using her emergency powers; she didn’t declare a legal holiday, as she could have done using another part of the DC Code. And if she had, every act required to be done “from every battlefield and patriot grave to every living heart and hearthstone all over this broad land” would be set back a day, because legal holidays in DC don’t count for any Tax Court related act anywhere.

While all the arguments are reasonable, they don’t cut it.

Except the FRCP Rule 6 argument. Felix, you’re in.

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