A topic that regularly comes up year after year in Tax Court cases is the issue of whether a document meets the requirements for protection under the timely mailed, timely filed rule found in IRC §7502(a).  In the case of Seely v. Commissioner, TC Memo 2020-6,[1] we have one of the infrequent taxpayer victories when faced with such a challenge.

IRC §7502(a) provides:

(a) General rule

(1) Date of delivery

If any return, claim, statement, or other document required to be filed, or any payment required to be made, within a prescribed period or on or before a prescribed date under authority of any provision of the internal revenue laws is, after such period or such date, delivered by United States mail to the agency, officer, or office with which such return, claim, statement, or other document is required to be filed, or to which such payment is required to be made, the date of the United States postmark stamped on the cover in which such return, claim, statement, or other document, or payment, is mailed shall be deemed to be the date of delivery or the date of payment, as the case may be.

(2) Mailing requirements

This subsection shall apply only if—

(A) the postmark date falls within the prescribed period or on or before the prescribed date—

(i) for the filing (including any extension granted for such filing) of the return, claim, statement, or other document, or

(ii) for making the payment (including any extension granted for making such payment), and

(B) the return, claim, statement, or other document, or payment was, within the time prescribed in subparagraph (A), deposited in the mail in the United States in an envelope or other appropriate wrapper, postage prepaid, properly addressed to the agency, officer, or office with which the return, claim, statement, or other document is required to be filed, or to which such payment is required to be made.

Of course, the key problem with this provision is that it all depends on a few things happening—first, the postmark being applied to the envelope by the United States Postal Service (USPS), second, the postmark showing the proper date and third, that letter and postmark making it into the hands of the IRS.  The case today involves a failure with the first issue—the postmark did not get applied to the envelope by the United States Postal Service.

The facts, as detailed by the Court, are as follows:

On March 28, 2017, respondent mailed petitioners, by certified mail to their last known address, a notice of deficiency for tax years 2013, 2014, and 2015. The notice of deficiency advised petitioners that they had 90 days from the date of the notice to file a petition in the Tax Court for a redetermination of the deficiency. The notice of deficiency also stated that the last day to petition the Tax Court was June 26, 2017.

Petitioners’ attorney, Scott Boyce, prepared a petition seeking a redetermination of the deficiencies and mailed it to the Tax Court. The Court received the petition on July 17, 2017, 111 days after the mailing of the notice of deficiency. The envelope in which the petition was mailed was properly addressed to the Tax Court. The envelope bears U.S. postage stamps and thus appears to have been delivered by the U.S. Postal Service (USPS). However, the envelope bears no discernable postmark and has no other markings affixed by the USPS.[2]

The Court notes that taxpayers aren’t necessarily out of luck when no postmark is visible on the envelope.  Rather, the Court looks to the following for evidence of when the letter likely made it to the USPS:

When a postmark is missing, our caselaw instructs us to deem the postmark illegible and permit the introduction of extrinsic evidence to ascertain the mailing date. See Sylvan v. Commissioner, 65 T.C. 548, 553-555 (1975); see also Mason v. Commissioner, 68 T.C. 354, 356 (1977). The burden is on the party who invokes section 7502 to present “convincing evidence” of timely mailing. Mason v. Commissioner, 68 T.C. at 356-357; see sec. 301.7502-1(c)(1)(iii)(A), Proced. & Admin. Regs. (providing that, if a USPS postmark “is not legible, the person * * * [invoking section 7502] has the burden of proving the date that the postmark was made”).

When confronted with illegible or missing postmarks, we have considered various types of extrinsic evidence, including testimony from the person claiming to have mailed the envelope. See Mason v. Commissioner, 68 T.C. at 357. We also look to evidence regarding the normal delivery time from the place of origin to our Court in Washington, D.C. See id.; Selter v. Commissioner, T.C. Memo. 2000-316, 2000 Tax Ct. Memo LEXIS 373, at *11; Robinson v. Commissioner, T.C. Memo. 2000-146, 2000 Tax Ct. Memo LEXIS 176, at *5. We may examine  the envelope to see whether any markings indicate that the letter had been “misplaced, missent, or inadvertently lost or damaged”. Robinson v. Commissioner, 2000 Tax Ct. Memo LEXIS 176, at *3 (noting the testimony of a post office employee that, in the event of misdelivery or damage, “there should be some sort of marking on * * * [the envelope] ‘to let you know exactly what has happened to that letter’”).

The envelope that contained the petition in this case is not damaged and has no marking of any kind suggesting that it was misdirected or misplaced. The envelope, however, does not bear any postmark. Therefore, the issue turns on whether petitioners have presented convincing evidence establishing that they timely mailed their petition. We allowed both parties to present extrinsic evidence to establish the petition’s mailing date. See Sylvan v. Commissioner, 65 T.C. at 553-555.[3]

The taxpayers produced a declaration from their attorney regarding when the document was mailed:

…[P]etitioners’ attorney supplied a declaration (Mr. Boyce’s declaration) under penalty of perjury in which he states that “on June 22, 2017 * * * [he] deposited into the [USPS] collection receptacle located at 690 Gage Blvd, Richland, Washington 99352, the tax court petition of Michael and Nancy Seely”.[4]

Since that date was before the last day for mailing the petition, if the Court accepted that statement as true then the taxpayers’ petition was timely.  Since the taxpayer must present convincing evidence, the Court looked to other evidence to either confirm or bring into doubt the assertion that the document was mailed on June 22, 2017.

The IRS objected that the letter did not arrive at the Tax Court within the normal time it would take for a letter to make it to the Court.  As the Court notes:

At the hearing respondent alleged that it takes 8 to 15 business days for the USPS to deliver a piece of mail to a Government agency located in Washington, D.C., from any location in the United States. Petitioners do not dispute this contention, and we deem it conceded. If the petition was mailed on June 26, 2017, the last day to file a petition, then the petition’s delivery date would have fallen within the 15-day window. In a sworn declaration Mr. Boyce declared that he deposited the petition in the U.S. mail several days earlier, on June 22, 2017. Respondent argues that if the petition had in fact been mailed on June 22, 2017, then it would have been delivered to the Tax Court no later than July 14, 2017, which was a Friday. The petition, however, arrived on Monday, July 17, 2017. Because the petition arrived at the Court later than it should have (16 business days after the alleged mailing date rather than 15), respondent contends that Mr. Boyce’s declaration is not convincing evidence.[5]

But the Tax Court found the IRS’s evidence wasn’t persuasive that the letter wasn’t mailed when claimed:

First, we note that the petition arrived at the Court only one business day late. We also note that the Fourth of July holiday fell between the date of the alleged mailing and the delivery date. In prior cases holiday conditions at the post office (e.g., holiday closures, unusually large volumes of mail, or inefficiencies attributable to temporary staff) have been found to be a possible explanation for short delays in delivery. Rotenberry v. Commissioner, 847 F.2d 229 (5th Cir. 1988) (finding that holiday conditions could explain a three-day delay in ordinary delivery time for a letter mailed on December 23); see also Mason v. Commissioner, 68 T.C. at 357 (noting the testimony of a post office employee that, because of the Bicentennial celebrations being conducted in Washington, D.C., over the Fourth of July weekend, “it is possible that mail going * * * [to Washington, D.C.] at about that time could have been delayed”). We are thus unpersuaded by respondent’s argument that Mr. Boyce’s declaration is not reliable because the petition’s alleged mailing date does not square with its actual delivery date.[6]

Thus, the Court found that it was more likely than not that the petition was mailed when the attorney stated it was mailed, and thus the filing was timely.

[1] Seely v. Commissioner, TC Memo 2020-6, January 13, 2020, https://www.ustaxcourt.gov/USTCInOP/OpinionViewer.aspx?ID=12146 (retrieved January 14, 2020)

[2] Seely v. Commissioner, pp. 2-3

[3] Seely v. Commissioner, pp. 5-6

[4] Seely v. Commissioner, p. 3

[5] Seely v. Commissioner, p. 7

[6] Seely v. Commissioner, p. 8