Use of Wrong Delivery Service Results in Dismissal of Tax Court Petition

Taxpayers who chose the wrong type of FedEx delivery service did not get the benefit of the timely mailing/timely filing rule and as a result had their petition dismissed by the Tax Court (Scaggs, T.C. Memo. 2012-258).

The taxpayers had filed a petition in Tax Court challenging an IRS notice of deficiency. The 90-day period to file the petition expired on July 7, 2011, and although the petition was sent by that date, it was not received by the Tax Court until July 12, 2011.

Under Sec. 7502(a), a timely mailed petition is treated as timely filed as of the date of the U.S. postal service postmark on the envelope in which the petition was mailed, and under Sec. 7502(f), petitions sent using designated private delivery services get the benefit of this rule. However, the taxpayers sent their petition via FedEx Express Saver Third Business Day delivery service, which is not one of the private delivery services specifically designated by the IRS in Notice 2004-83 (although several other FedEx delivery services are, including FedEx 2 Day).

As a result, the Tax Court dismissed the petition for not being timely filed. Although the Tax Court admitted that the dismissal seemed “harsh,” it noted that it could not apply equitable principles to cure a lack of jurisdiction and that the taxpayers do have a chance at a judicial remedy if they pay the tax and then sue for a refund.