In the case of Nguyen v. Commissioner, TC Memo 2023-151, the taxpayer’s choice of an incorrect delivery service resulted in the filing of their Tax Court petition beyond the designated final filing date.

Timely Mailing, Timely Filing Rule Under IRC §7502

IRC §7502(a) establishes the principle of “timely mailing is timely filing” for federal tax documents, including petitions to the Tax Court. This section of the law states:

(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.

IRC §7502(c) offers a method for obtaining proof of postmark through the use of registered mail. Additionally, it authorizes the IRS to accord similar status to certified mail, as outlined in the regulations issued by the agency.

(c) Registered and certain mailing; electronic filing.

(1) Registered mail. For purposes of this section, if any return, claim, statement, or other document, or payment, is sent by United States registered mail--

(A) such registration shall be prima facie evidence that the return, claim, statement, or other document was delivered to the agency, officer, or office to which addressed; and

(B) the date of registration shall be deemed the postmark date.

(2) Certified mail; electronic filing. The Secretary is authorized to provide by regulations the extent to which the provisions of paragraph (1) with respect to prima facie evidence of delivery and the postmark date shall apply to certified mail and electronic filing.

Subsequently, Congress broadened this provision by introducing IRC §7502(f), which extends similar treatment to designated private delivery services.

(f) Treatment of private delivery services.

(1) In general. Any reference in this section to the United States mail shall be treated as including a reference to any designated delivery service, and any reference in this section to a postmark by the United States Postal Service shall be treated as including a reference to any date recorded or marked as described in paragraph (2)(C) by any designated delivery service.

(2) Designated delivery service. For purposes of this subsection, the term “designated delivery service” means any delivery service provided by a trade or business if such service is designated by the Secretary for purposes of this section. The Secretary may designate a delivery service under the preceding sentence only if the Secretary determines that such service--

(A) is available to the general public,

(B) is at least as timely and reliable on a regular basis as the United States mail,

(C) records electronically to its data base, kept in the regular course of its business, or marks on the cover in which any item referred to in this section is to be delivered, the date on which such item was given to such trade or business for delivery, and

(D) meets such other criteria as the Secretary may prescribe.

(3) Equivalents of registered and certified mail. The Secretary may provide a rule similar to the rule of paragraph (1) with respect to any service provided by a designated delivery service which is substantially equivalent to United States registered or certified mail.

The IRS has issued Notice 2016-30, enumerating the private delivery services (PDSs) considered equivalent to registered and certified mail. The designated PDSs were:

DHL Express:

DHL Express 9:00
DHL Express 10:30
DHL Express 12:00
DHL Express Worldwide
DHL Express Envelope
DHL Import Express 10:30
DHL Import Express 12:00
DHL Import Express Worldwide

FedEx:

FedEx First Overnight
FedEx Priority Overnight
FedEx Standard Overnight
FedEx 2 Day
FedEx International Next Flight Out
FedEx International Priority
FedEx International First
FedEx International Economy

UPS:

UPS Next Day Air Early AM
UPS Next Day Air
UPS Next Day Air Saver
UPS 2nd Day Air
UPS 2nd Day Air A.M.
UPS Worldwide Express Plus
UPS Worldwide Express

The services listed in Notice 2016-30 were the officially recognized private delivery services (PDSs) as of the date when the taxpayer filed their petition with the U.S. Tax Court.

Facts of the Taxpayer’s Case

The U.S. Tax Court received the taxpayer’s petition one day beyond the final date permitted for filing.

The Petition in this case was filed on January 12, 2023, one day after expiration of the 90-day filing period. In urging that we nonetheless have jurisdiction, petitioners rely on the “timely mailed, timely filed” rule in section 7502. It sets forth the general rule that, for any document “delivered by United States mail . . . the date of the United States postmark stamped on the cover . . . shall be deemed to be the date of delivery.” §7502(a)(1).

Petitioners did not send their Petition to the Court by U.S. mail, but rather used FedEx, a private delivery service. Section 7502(f), captioned “Treatment of Private Delivery Services,” provides that “[a]ny reference in this section to the United States mail shall be treated as including a reference to any designated delivery service.” Section 7502(f)(2) defines a “designated delivery service” to mean a private delivery service “if such service is designated by the Secretary for purposes of this section.”

The Court acknowledged the earlier-mentioned IRS publication listing designated PDSs. It noted that the taxpayers utilized FedEx Ground, a service not included on that list, for delivering their petition to the Tax Court.

The IRS has published a list of all private delivery services that have been designated by the Secretary for purposes of section 7502. See I.R.S. Notice 2016-30, 2016-18 I.R.B. 676. This list includes certain forms of delivery made available by FedEx, but not FedEx Ground, the delivery service petitioners used. Notice 2016-30, 2016-18 I.R.B. at 676, specifically states that “FedEx . . . [is] not designated with respect to any type of delivery service not enumerated in this list.” Because petitioners did not use a “designated delivery service” as defined by section 7502, they are unable to avail themselves of the “timely mailed, timely filed” rule. Cf. Guralnik v. Commissioner, 146 T.C. 230, 240-42 (2016) (holding that the “timely mailed, timely filed” rule does not apply to “FedEx First Overnight” because that service is not a designated private delivery service); Raczkowski v. Commissioner, T.C. Memo. 2007-72, 93 T.C.M. (CCH) 1045, 1046 (holding that the “timely mailed, timely filed” rule does not apply to “UPS Ground” because that service is not a designated private delivery service).

The taxpayers contended that FedEx Ground, in this instance, was substantially similar to FedEx 2-Day—a service included in the IRS's list of designated PDSs. They argued that this similarity should permit them to utilize the timely mailing rule. However, the Tax Court did not concur with this perspective.

Petitioners do not dispute that their Petition was filed after the 90-day period specified in section 6213(a), nor do they dispute that FedEx Ground is not on the list of private delivery services that have been “designated by the Secretary.” Rather, they contend that FedEx Ground is “substantially identical” to “FedEx 2-Day,” a delivery service that has been designated by the Secretary for purposes of section 7502. On the basis of this asserted similarity between the two delivery services, petitioners contend that the “timely mailed, timely filed” rule should be available to them.

Unfortunately we must disagree. FedEx Ground may well be substantially similar to the FedEx 2-Day delivery service. But this Court may not rely on general equitable principles to expand the statutorily prescribed time for filing a petition. See Eichelburg v. Commissioner, T.C. Memo. 2013-269, 106 T.C.M. (CCH) 606, 607. Congress has chosen to make the “timely mailed, timely filed” rule available for a private delivery service only “if such service [has been] designated by the Secretary.” §7502(f)(2). Because FedEx Ground has not been so designated, our hands are tied. We are not at liberty to make a designation that Congress has explicitly committed to the Secretary’s discretion.

The Court determined that the taxpayers cannot contest the IRS's assessment in the Tax Court. However, other alternatives, likely less favorable, remain available for the taxpayers to further pursue the issue.

Because the Petition was not filed within the time prescribed by section 6213(a) and the “timely mailed, timely filed” rule is not available, we lack jurisdiction and must grant respondent’s Motion to Dismiss. Although petitioners may not prosecute this case in the Tax Court, we note that they may pursue with the IRS an administrative resolution of their 2017 and 2018 tax liabilities. Another remedy potentially available to them is to pay the tax in dispute and file a claim for refund with the IRS. If that claim is denied (or not acted upon after six months), petitioners may file a suit for refund in the appropriate U.S. district court or the U.S. Court of Federal Claims. See McCormick v. Commissioner, 55 T.C. 138, 142 n.5 (1970).

What About Equitable Relief?

Recall that in Culp v. Commissioner, 75 F.4th 196, 205 (3d Cir. 2023), the Third Circuit acknowledged the Tax Court's authority to grant equitable relief. Does this precedent have applicability in the current case, potentially allowing it to progress? Regrettably for the taxpayer, any appeal in this instance would fall under the jurisdiction of the Tenth Circuit Court of Appeals. As indicated in a footnote to the opinion:

Absent stipulation to the contrary this case is appealable to the Tenth Circuit, and we thus follow its precedent, which is squarely on point. See Golsen v. Commissioner, 54 T.C. 742, 756-57 (1970), aff’d, 445 F.2d 985 (10th Cir. 1971). The Tenth Circuit has long agreed with this Court’s holdings that the statutory period prescribed by section 6213(a) is a jurisdictional requirement. See Armstrong v. Commissioner, 15 F.3d at 973 n.2; Foster v. Commissioner, 445 F.2d 799, 800 (10th Cir. 1971). Thus, we need not address a recent ruling by the U.S. Court of Appeals for the Third Circuit that the statutory filing deadline in deficiency cases is a non-jurisdictional “claims-processing” rule. See Culp v. Commissioner, 75 F.4th 196, 205 (3d Cir. 2023).