Opinion
7011-22
05-06-2024
MILTON THOMAS ROBERTS, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Courtney D. Jones, Judge.
This case is on the calendar of the Court's May 20, 2024, trial session for New York City, New York. By notice of deficiency, dated January 6, 2022, the Commissioner determined that petitioner Milton Thomas Roberts was liable for an income tax deficiency for taxable year 2014, as well as a failure to file addition to tax under section 6651(a)(1) and an accuracy-related penalty under section 6662(a). Currently before the Court are two motions: (1) Mr. Roberts's Motion for Summary Judgment, filed March 21, 2024; and (2) Mr. Roberts's Motion for Continuance, filed May 2, 2024. For the reasons discussed below, we will deny Mr. Roberts's Motion for Summary Judgment and Motion for Continuance.
Unless otherwise indicated, statutory references are to the Internal Revenue Code, Title 26 U.S.C., in effect at all relevant times, regulatory references are to the Code of Federal Regulations, Title 26 (Treas. Reg.), in effect at all relevant times, and Rule references are to the Tax Court Rules of Practice and Procedure.
Background
The following background information is drawn from the parties' pleadings and motion papers and the exhibits attached thereto. See Rule 121(c). This background is stated solely for the purpose of resolving the present Motion for Summary Judgment and is not stated as findings of fact in this case. See Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520 (1992), aff'd, 17 F.3d 965 (7th Cir. 1994). Mr. Roberts resided in New York when he timely filed the Petition.
Mr. Roberts did not timely file a tax return for, inter alia, taxable year 2014. On February 16, 2016, Mr. Roberts mailed a package to the Internal Revenue Service (IRS), which he claims contained returns for taxable years 2013 and 2014. However, the IRS continued to send Mr. Roberts notices requesting that he file a return for taxable year 2014. Therefore, Mr. Roberts claims to have re-created-to the best of his abilities-the return he purports to have mailed to the IRS on February 16, 2016. On or around June 2, 2020, the IRS received Mr. Roberts return for taxable year 2014.
In the Motion, Mr. Roberts claims that the IRS sent him notices in 2021 requesting the filing of a return for taxable year 2014, and he sent a re-created return to the IRS sometime thereafter. However, based on the limited evidence contained in the record, it appears that the IRS received Mr. Roberts's return for taxable year 2014 on or around June 2, 2020. In light of this discrepancy, the timeline of events is not entirely clear.
The IRS opened an examination into Mr. Roberts and requested substantiation for the claimed alimony deductions for taxable year 2014. Mr. Roberts requested relevant bank statements from HSBC, a bank where he maintained a checking account. However, HSBC was unable to provide Mr. Roberts with copies of the requested records due to the passage of time. Therefore, the IRS disallowed the claimed alimony deductions for taxable year 2014 and adjusted the withholding credits he claimed to reflect the amounts shown on information returns submitted to the IRS by third parties. On January 6, 2022, the IRS mailed Mr. Roberts a notice of deficiency.
On April 2, 2022, Mr. Roberts timely filed a Petition seeking redetermination of the deficiency and addition to tax and penalty for taxable year 2014.
Discussion
I. Mr. Roberts's Motion for Summary Judgment
On March 21, 2024, Mr. Roberts filed the Motion for Summary Judgment. Therein, Mr. Roberts asserts-as he does in the Petition-that the period of limitation for assessment for taxable year 2014 has expired. See § 6501(a). On April 16, 2024, respondent filed a Notice of Objection to Petitioner's Motion for Summary Judgment. Respondent avers that the period of limitation for assessment has not expired and that the notice of deficiency was timely. For the reasons discussed below, we will deny Mr. Roberts's Motion for Summary Judgment.
A. Summary Judgment Standard
Summary judgment serves to "expedite litigation and avoid unnecessary and expensive trials." Fla. Peach Corp. v. Commissioner, 90 T.C. 678, 681 (1988). We may grant summary judgment when there is no genuine dispute as to any material fact, and a decision may be rendered as a matter of law. See Rule 121(a)(2); Sundstrand Corp., 98 T.C. at 520. In deciding whether to grant summary judgment, we construe factual materials and inferences drawn from them in the light most favorable to the nonmoving party. Sundstrand Corp., 98 T.C. at 520 . The nonmoving party may not rest upon mere allegations nor denials in their pleadings and must set forth specific facts showing that there is a genuine dispute for trial. Rule 121(d); see also Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). Based on the record before the Court, we find that this case is not appropriate for summary adjudication.
B. Analysis
Section 6501 sets forth the rules limiting the time during which the amount of any tax can be assessed and collected. As a general rule, section 6501(a) provides that the amount of any tax shall be assessed "within 3 years after the return was filed." See, e.g., Couturier v. Commissioner, No. 19714-16, 162 T.C., slip op. at 6 (Feb. 28, 2024). Generally, for purposes of determining the commencement of the period of limitation for assessment of tax, a return is filed on the date it is received by the Commissioner. See, e.g., United States v. Lombardo, 241 U.S. 73, 76 (1916); Walden v. Commissioner, 90 T.C. 947, 951 (1988) (collecting cases); Gray v. Commissioner, 16 T.C. 262, 266 (1951).
Section 7502, however, provides an exception to the general rule, and is known as the "timely mailing is timely filing" rule. Section 7502(a) provides that if a return is received after the due date but postmarked on or before the due date, the return will be treated as filed on the date it was mailed. See, e.g., Estate of Wood v. Commissioner, 92 T.C. 793, 796 (1989), aff'd 909 F.2d 1155 (8th Cir. 1990); Deutsch v. Commissioner, 599 F.2d 44, 66 (2d Cir. 1979). Further, if a return is mailed on or before the due date via registered or certified mail, then proof of mailing constitutes prima facie evidence of delivery. See § 7502(c); Treas. Reg. § 301.7502-1(c)(2) and (e)(2). However, section 7502(a) is only applicable when a return is timely filed. See § 7502(a); Treas. Reg. § 301.7502-1(c)(1)(ii). When a return is mailed after the due date, the return is considered filed on the date the return is received by the IRS. Emmons v. Commissioner, 92 T.C. 342, 346-47 (1989), aff'd 898 F.2d 50 (5th Cir. 1990); Radding v. Commissioner, T.C. Memo. 1988-250.
In the Motion for Summary Judgment, Mr. Roberts asserts that the Court should grant summary judgment because the IRS's notice of deficiency was issued after the expiration of the period of limitation. Mr. Roberts principally relies on two cases. First, Mr. Roberts relies on Baldwin v. United States, 921 F.3d 836, 840-42 (9th Cir. 2019), wherein the U.S. Court of Appeals for the Ninth Circuit held that a taxpayer did not provide proof of timely filing (in that case a request for a refund) under the section 7502 statutory delivery rule and could not rely on the common law mailbox rule to prove delivery. Second, he relies upon In re McGrew, 559 B.R. 711, 717-18 (Bankr. N.D. Iowa Oct. 13, 2016). There, the court held that a debtor credibly testified that she mailed several returns to the IRS, particularly because the testimony was supported by internal IRS communications. Id. Thus, the court found that the IRS did not prove by a preponderance of the evidence that the taxpayer failed to file a return, and thus, the tax debt was discharged. Id. at 717-18.
Mr. Roberts contends that these cases are dispositive because respondent purportedly engaged in behavior consistent with receipt of his return for taxable year 2014. Further, he also asserts that PS Form 3800, U.S. Postal Service Certified Mail Receipt, dated February 16, 2016, is prima facie evidence of filing. We disagree.
First, section 7502 is inapplicable in this case. In the Petition, Mr. Roberts concedes that he did not timely file his return for taxable year 2014. Therefore, Mr. Roberts's return for taxable year 2014 would only be filed upon receipt of that return by the IRS, and the certified mailing receipt postmarked after the due date for filing the return is not prima facie evidence of the filing of the return. Estate of Wood, 92 T.C. at 796; see also § 7502(c)(2). Nonetheless, Mr. Roberts asserts that he has provided evidence that he mailed his returns for taxable years 2013 and 2014 in the form of a certified mail receipt. But Mr. Roberts did not include any return receipt as direct proof of actual delivery. Despite this fact, respondent acknowledges that he received Mr. Roberts's return for taxable year 2013, which was purportedly sent at the same time as Mr. Roberts's 2014 tax return. Nevertheless, Mr. Roberts has not set forth any evidence that the February 2, 2016 package contained his return for taxable year 2014. Therefore, a genuine dispute remains regarding the issue of whether Mr. Roberts mailed-and respondent received-Mr. Roberts's return for taxable year 2014 at the same time it received his return for taxable year 2013. Accordingly, we will deny Mr. Robert's Motion for Summary Judgment.
II. Motion for Continuance
On May 1, 2024, Meredith M. Mazzola filed an Entry of Appearance as counsel for Mr. Roberts. On May 2, 2024, Mr. Roberts, through counsel, filed a Motion for Continuance. Therein, Mr. Roberts states that he hired counsel on May 1, 2024, and that counsel needs additional time to review the evidence and law in this matter. Mr. Roberts also states that he is in the process of obtaining records from various institutions, and that obtaining additional information may result in settlement, or at the very least, a greater stipulation of facts that will save the Court time and resources. Respondent objects to the granting of the Motion for Continuance.
The Standing Pretrial Order requires that motions for continuance must be filed no later than 31 days before the first day of the trial session. The first day of the New York City, New York trial session is May 20, 2024, and therefore the deadline for filing a motion for continuance was April 19, 2024. Mr. Roberts's Motion for Continuance is untimely. Further, Rule 133 and the Standing Pretrial Order provide that continuance will be granted only in exceptional circumstances. Rule 133 provides that employment of new counsel ordinarily will not be regarded as grounds for continuance.
III. Conclusion
For the reasons set forth herein, we will deny Mr. Roberts's Motion for Summary Judgment and Motion for Continuance. We have considered all of the arguments made by the parties, and to the extent not mentioned above, we conclude that they are moot, irrelevant, or without merit.
Upon due consideration, it is
ORDERED that Mr. Roberts's Motion for Summary Judgment (Doc. 12), filed March 21, 2024, is denied. It is further
ORDERED that Mr. Robert's Motion for Continuance (Doc. 21), filed May 2, 2024, is denied.