In the case of Thomas v. Commissioner, TC Memo 2020-33[1] the taxpayers discovered the risk of dropping a tax related document in a mailbox that you think will be picked up and postmarked that day.  In this case the document in question was their Tax Court petition.

The last day for Sara and David Thomas to file their petition with the Tax Court to challenge the IRS’s notice of deficiency was March 5, 2018.[2]

The taxpayers decided to go forward with a Tax Court challenge.  The Court notes:

In response to the notice of deficiency petitioners decided to file a petition seeking redetermination of the deficiency. On March 5, 2018, in anticipation of the mailing of the petition, petitioner wife stamped an envelope using a private postage meter from her employer’s office. On that same day she went home and delivered the stamped envelope to her husband. After petitioner husband finished preparing the petition, he placed it in the stamped envelope. Thereafter, on either March 5 or 6, 2018, at a time we do not know, petitioner husband took the petition to a U.S. Postal Service (USPS) office in Fernley, Nevada, where he deposited the petition into a USPS mailbox. The last mail pickup time at that USPS mailbox was ordinarily 5 p.m.[3]

The petition arrived at the Tax Court 98 days after the IRS issued the notice of deficiency.  The envelope containing the petition bore two postmarks:

• A private postage mark (such as from a postage meter) that was dated March 5, 2018, the last day for filing the petition and

• A USPS postmark that was dated March 6, 2018 (the day after the deadine for filing the petition).[4]

The taxpayers pointed that the regulations provide that for an envelope bearing a postmark not made by the US Postal Service, the document is deemed filed on that postmark date if:

• The postmark must show a legible  date or before the last date for filing the document and

• The package must be received within the same time it would have been had it been postmarked by the USPS from the same point of origin on the last date for filing.[5]

Since the document arrived 8 days after the last date to file, it met these requirements in the view of the taxpayer.

However, the IRS pointed out that if a document contains both a private postmark and a USPS applied postmark, the regulations provide that the USPS applied postmark takes precedence.  Reg. §301.7502-1(c)(1)(iii)(B)(3) provides:

If the envelope has a postmark made by the U.S. Postal Service in addition to a postmark not so made, the postmark that was not made by the U.S. Postal Service is disregarded, and whether the envelope was mailed in accordance with this paragraph (c)(1)(iii)(B) will be determined solely by applying the rule of paragraph (c)(1)(iii)(A) of this section.

Reg. §301.7502-1(c)(1)(iii)(A) provides that a taxpayer who mails an envelope relying solely on the hope the USPS will postmark in time bears the risk that the document will be deemed not timely filed if that postmark is not applied by the deadline date.  The opinion notes there is a way to assure the timely mailing:

By using registered or certified mail, the sender can obtain a postmarked receipt from the USPS that is evidence of timely mailing and hence timely filing. See sec. 7502(c); sec. 301.7502-1(c)(2), Proced. & Admin. Regs.; see also sec. 7502(f) (regarding the use of private delivery services).[6]

The taxpayer asked for relief from the Court, providing the following justification:

Petitioners assert that petitioner husband took the petition to the Fernley USPS office on March 5, 2018, and placed it in the mailbox before 5 p.m., the last mail pickup time at that office. The Fernley USPS office, however, postmarked the envelope on March 6, 2018. Respondent speculates that the USPS office may have already been closed by the time petitioner husband placed the petition in the mailbox, which may be why the envelope was postmarked the day after the alleged mailing date. Respondent also notes that had petitioner husband taken the petition to the Reno USPS office the envelope would have been postmarked on that same day because that office postmarks mail pieces until 11:59 p.m.[7]

But the Tax Court found that was not a possibility:

We follow the guidelines the regulations provide us. In this instance the regulations instruct us that where the envelope containing the petition bears a legible USPS postmark, the postmark must bear a date on or before the last date prescribed for filing for it to be considered timely filed. See sec. 301.7502-1(c)(1)(iii)(A), Proced. & Admin. Regs. Accordingly, even if we were to credit petitioners' assertions that they timely deposited the petition in the mail, the petition is still considered not timely filed because the USPS postmark on the envelope does not bear a date on or before March 5, 2018. See id. Further, because petitioners mailed the petition using postage printed through a private postage meter with no request that a certified mail receipt be postmarked by a USPS employee, they are not entitled to any relief under section 301.7502-1(c)(2), Proced. & Admin. Regs. Accordingly, the Court lacks jurisdiction under sections 6213(a) and 7502 to redetermine the deficiency, and we are obliged to grant respondent's motion to dismiss.[8]

[1] Thomas v. Commissioner, TC Memo 2020-33, March 11, 2020, https://www.ustaxcourt.gov/UstcInOp/OpinionViewer.aspx?ID=12189 (retrieved March 13, 2020)

[2] Thomas v. Commissioner, TC Memo 2020-33, p. 2

[3] Thomas v. Commissioner, TC Memo 2020-33, p. 3

[4] Thomas v. Commissioner, TC Memo 2020-33, pp. 3-4

[5] Thomas v. Commissioner, TC Memo 2020-33, p. 6, Reg. §301.7502-1(c)(1)(iii)(B)(i)

[6] Thomas v. Commissioner, TC Memo 2020-33, p. 8

[7] Thomas v. Commissioner, TC Memo 2020-33, pp. 8-9

[8] Thomas v. Commissioner, TC Memo 2020-33, pp. 9-10