Tax Court Filing Deadlines in a Time of Coronavirus

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This post seeks to set out sample Tax Court filing deadlines under the two different extraordinary filing extensions at play at this moment.  The Tax Court closed on March 19, 2020.  The closure of the Tax Court triggered an extended time to file Tax Court petitions as a result of the case of Guralnik v. Commissioner, 146 T.C. 230 (2016) (en banc).  It is unknown at the moment how long the Tax Court will remain closed.  For purposes of this post, we will assume that it remains closed until June 30, 2020.  Of course, it is important to watch the date the Tax Court reopens.  If it reopens after July 15, 2020, or before June 30, 2020, the answers here will change. 

We have discussed Guralnik on several occasions here, here, here, and here.  Guralnik was the first case in which the tax clinic at Harvard Law School made the argument that time frames in the Tax Court are not jurisdictional under the prevailing Supreme Court precedent.  Although the Tax Court rejected the clinic’s argument in a close vote (16-0), it determined, instead, that it had jurisdiction in that Collection Due Process (CDP) case.  It did so because the clerk’s office of the Tax Court was closed, the Tax Court had no rule regarding the closure of the clerk’s office, but the Tax Court had a rule that if it lacked a rule it could look to the Federal Rules of Civil Procedure (FRCP).  In FRCP 4 the rule provides that if the clerk’s office is closed the party can perform the act on the next day the clerk’s office opens.

In addition to the extension of time to file a Tax Court petition created by Guralnik, Congress gave the IRS the power to extend the Tax Court filing deadline.  IRC 7508A grants this power in the event of a federally determined disaster.  The COVID-19 pandemic caused the US President to declare the entire nation a disaster area which opened up the ability of the IRS to use its power under IRC 7508A.  On April 9, 2020, the IRS issued Notice 2020-23 exercising that power and stating that any Tax Court petition due between April 1, 2020 and July 15 2020 was due on July 15, 2020.

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The two provisions now at play that impact the timing of filing a Tax Court petition will have varying impacts depending on when the taxpayer is due to file a petition.  The examples used in this post will address the time frame for a notice of deficiency which is normally 90 days from the due date of the notice.  Here, the Tax Court closure occurred prior to the declaration of disaster and the Tax Court will reopen (at least at this moment it appears that way) prior to the date that the Notice 2020-23 will cause the time to start running again.  Note that the time frame for other types of Tax Court cases, such as CDP, runs only 30 days after the notice of determination and the examples here would not apply but would need to be adapted to the applicable time if other than 90 days.

Example 1 – Statutory Notice of Deficiency (SNOD) issued Monday, December 15, 2019 – last date to file petition March 16, 2020

The 90-day period runs on Sunday March 15.  IRC 7503 provides that the where the last date to perform an act falls on a Saturday, Sunday or Holiday the act moves to the next day.  Here, that day is Monday March 16.  Because the Tax Court was still open on Monday March 16, the last day to file the petition is March 16. 

Note that the Tax Court and the IRS consider this date a jurisdictional time period.  Tomorrow’s post will offer an alternative view.  We anticipate that there will be many transmission problems in getting petitions to the Tax Court following this closure just as there were the last time the Court closed.  If you represent someone who missed the deadline for a good reason, consider arguing that Supreme Court cases matter in this situation.

Example 2 – SNOD issued on Tuesday, December 31, 2019 – last day to file the petition July 1, 2020

The 90-day period runs on Monday, March 30.  On Monday, March 30 the Tax Court was closed.  Because the Tax Court was closed it was not possible to file the petition.  This causes the Guralnik exception to apply.  Applying that exception, the petition should be filed on the first day the Tax Court reopens.  That day, under the presumption used in this post, is Wednesday, July 1, 2020.

Of course, it would be reckless to wait and file on July 1, 2020 if you know about the need to file a petition prior to that date.  So, you should mail the petition to the Tax Court prior to July 1, 2020. 

In mailing the petition to the Tax Court prior to the reopening of the Court, the petition will not be delivered to the Court since it is closed.  The press release closing the court, linked above, contains the following statement:

Mail will not be delivered to the Court until the building reopens. Taxpayers may comply with statutory deadlines for filing petitions or notices of appeal by timely mailing a petition or notice of appeal to the Court. Timeliness of mailing of the petition or notice of appeal is determined by the United States Postal Service’s postmark or the delivery certificate of a designated private delivery service. Petitions and other documents may not be hand delivered to the Court.

The petition will be held somewhere waiting for the Court to reopen.  The best advice on mailing during this period is to send the petition via certified mail return receipt request.  The USPS will hold mail sent to the Court through it and deliver the mail to the Court when it reopens.  [If anyone in the Tax Court clerk’s office would be willing to do an interview about what it was like in that office when it reopened after the government shutdown, we would be glad to interview you if you have permission to do so and will not get in trouble for talking to us.] 

While it is permissible to use private delivery services to send petitions to the Court and have the timely mailing rule of IRC 7502 apply, in the 2019 government shutdown there were some problems with the way the private delivery services handled the situation.  You can read about one such case here.    I don’t think that was the only case in which private delivery service caused some problems.  You should also read the Guralnik case for a cautionary tale on which private delivery service to choose.  Go and find the most recent IRS notice setting out the approved delivery services.  The most recent one on the day of the publishing of this post is Notice 2016-30

No matter how you choose to mail the petition to the Tax Court, please please please send it in a way that allows you to have a receipt of the mailing.  This could become very important.

Note that in Example 2 the issuance of Notice 2020-23 by the IRS may have no importance because the IRS did not issue the Notice until after the due date of the petition and the notice covers actions with deadlines beginning on April 1, 2020 which comes after the deadline for filing this petition.  It is not known how the closure of the Tax Court and the extended time to file the petition interacts with the extension granted in Notice 2020-23 pursuant to IRC 7508A.  The Notice says, “This notice does not provide relief for the time period for filing a petition with the Tax Court, or for filing a claim or bringing a suit for credit or refund if that period expired before April 1, 2020.”

We recommend against assuming that the Notice provides a further extension because the last day to file the petition in the Tax Court was still open at the time the Notice became effective.  Of course, if you represent someone who misses the July 1 deadline in this circumstance, in addition to arguing equitable tolling which will be discussed in tomorrow’s post, you might also argue that the interplay of the two periods of extension allows your client to file the petition by Wednesday, July 15 for the reasons discussed below.

Example 3 – SNOD issued on Wednesday, January 15, 2020 – last day to file Wednesday, July 15, 2020

Here, the normal due date of the petition would be Tuesday, April 14.  Because this falls when both the closure of the Tax Court and the disaster declaration by the IRS provide an extension, the taxpayer could file the petition on the later of the two extended periods.

Note that the extended periods do not suspend the time period to file the petition for the period of the closure or the period of disaster relief but provide a hard date for extended relief after which anyone whose time to act fell within that period must perform the act.  As with the last example, we would not recommend waiting until the last day to file the petition.  All of the advice regarding mailing the petition remains the same. The two extenders operate a little differently at the end of their time.  The Tax Court extends the time period until the next day the Tax Court is open.  So, if the Tax Court is closed until June 30, the first day it is open is July 1 and that becomes the deadline.  The Notice 2020-23 extension extends the time to the date listed in the Notice and not the day after.  So, if the taxpayer relies on the Notice the last day to perform the act, here to file the petition, is Wednesday, July 15.

Example 4 – SNOD issued on Friday, January 31, 2020 – last day to file Wednesday, July 15, 2020

The reasoning remains the same as in Example 3.  Here, the normal due date of the Tax Court petition is Thursday, April 30, 2020.  Because this falls when both the closure of the Tax Court and the disaster declaration by the IRS provide an extension, the taxpayer could file the petition on the later of the two extended periods.

Example 5 – SNOD issued any date between Friday, January 31 and Wednesday, April 15 – last day to file Wednesday, July 15, 2020

The reasoning remains the same as in Example 3.  Here, the normal due date of the Tax Court petition will fall before Wednesday, July 15.  Because the dates for these taxpayers receiving a SNOD prior to April 16 falls when both the closure of the Tax Court and the disaster declaration by the IRS provide an extension, the taxpayer could file the petition on the later of the two extended periods.

Example 6 – SNOD issued on Thursday, April 16 or later – last day to file is 90 days from the date of the notice

Neither the closure of the Tax Court (through June 30) nor the disaster declaration by the IRS provides an extension to taxpayers who receive a SNOD dated April 16 or later.

Conclusion

The analysis provided here is not like an analysis provided in an IRS notice or a pronunciation from the Tax Court.  This is only one private citizen speculating on due dates with no authority to provide coverage for you if you rely on this analysis to your detriment.  Do your own math and your own legal research to assure yourself of the correct last date for filing a petition, but we hope that these examples will assist in providing some clarity to the current situation with respect to filing a Tax Court petition.  As always, we welcome and encourage comments that add to this discussion.

Comments

  1. Carl Smith says

    It seems to me that the Tax Court would do everyone a favor under Guralnik by giving, say, a 2-week public warning before the Clerk’s Office reopens. If the court’s Clerk’s Office just reopens one day without prior announcement, how will people become aware that that very day is the last date to file under the Guralnik extension? Two weeks should be enough time to draft a petition. No one should be forced into drafting now while fighting COVID-19 and perhaps being unable to access their tax documents.

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