Carl Smith continues to probe the Tax Court docket sheet as he has done for many years but in his retired retirement, he finds working his way through DAWSON interesting as new features arrive unexpectedly to be discovered. The latest new feature Carl has found is one about which those of us who use the system regularly have been complaining since its inception – the inability to see the representatives. Now, it’s possible to see who is representing each party, but you must take a step to find out.
When you arrive on the docket sheet of a case, you will not see the persons representing the parties as you did prior to the change to DAWSON; however, if you click on the “Printable Docket Record” box on the right-hand side of the page near the top of the docket sheet, you will go to a sheet that displays the representatives. This is another step forward as the Tax Court continues to build out DAWSON.
You can test out this feature by going to this link. The link hopefully (I use this qualifier because all of the pre-DAWSON links in our blog to Tax Court orders were broken when DAWSON came into existence. We do not have the time and energy to fix all of the broken links and apologize for this problem. If you know someone willing to sponsor us to hire an energetic student to work on our links, we would welcome the sponsorship and the opportunity to update the old posts on the blog. It is also possible that we might have an energetic reader with time on their hands willing to make an in-kind donation to this free blog site and do the work necessary to update our links) takes you to the case of Villavicencio v. Commissioner.
While Carl brought to my attention the new DAWSON feature, Bob Kamman brought the Villavicencio case to my attention. The case makes a point that I made in a recent post in which I quoted extensively from the brief the tax clinic at Harvard filed with the Supreme Court in Boechler – the Tax Court polices the timely filing of petitions even when the IRS does not and the Tax Court will dismiss a case even when the parties are in the process of settling it. The case also highlights the dangers of using the wrong private delivery service, highlighted most often in this blog by reference to the Guralnik case. The case also points out a problem created by COVID and the shutdown of the Tax Court. Although it probably does not matter here for reasons discussed below, petitioner has not yet made jurisdictional arguments of the type frequently discussed in this blog.
Three weeks before trial, Judge Greaves raised the question of whether he had jurisdiction, because the notice of deficiency was issued on March 16, 2020, and the petition was not received until July 16, 2020. It was sent by UPS, but not by one of their acceptable methods. See Judge Greaves’ one-page order attached. Late deficiency petitions raise jurisdictional issues in the eyes of the Tax Court even if the IRS doesn’t file a motion to dismiss for lack of jurisdiction.
The IRS didn’t file an answer until October 27, 2020, more than three months after the petition was filed, but this is one of those cases about which we recently wrote where service of the petition on Chief Counsel, IRS did not occur for over two months after the petition was received. So, the answer here was timely, but if it had not been timely filed, late answers are forgivable from the Tax Court’s perspective.
I could digress and discuss the “strike fear” memo written by Chief Counsel Meade Whitaker in the mid-1970s threatening to fire any Chief Counsel attorney who did not file their answer on time, or I could digress further and talk about the time the Richmond office which I was heading filed seven answers late at once because of a snafu, but I will not. Instead, I will simply say that the Office of Chief Counsel generally does not like it when an answer is filed late and neither does the Tax Court, but the Tax Court does not usually punish the IRS in any way for a late answer. To my knowledge, the Office of Chief Counsel has not fired anyone for filing a late answer.
The case is calendared for a remote trial session in New York City on June 14, but the parties lodged a proposed stipulated decision on May 13. So, the parties are ready to settle, the Tax Court is ready to toss the case, and the taxpayer is wishing that the petition had been timely filed. If the Tax Court decides to dismiss the case for failure to timely file the petition, my expectation is that the IRS will honor the settlement and only assess the amount of tax, if any, agreed to by the parties. It is not my experience that the IRS would use the dismissal as a basis for assessing the entire liability and force the taxpayer in this S case to come up with full payment and file a suit in district court.
So, even though the petition was filed late, the petition was served late, and the Court caught the problem late in the process, all should end well for the parties, but before it ends well, they must spend time responding to the order that requires them to address the timeliness of the petition. The parties may not care about the timeliness of the petition anymore because they have figured out the right answer to the tax problem. That does not matter because the Tax Court cares. Should it, or should we have a system where the filing of the petition is not jurisdictional, but a claim processing issue which, if not raised by the IRS, does not bar the parties from moving forward with the case? If the Supreme Court does not change the Tax Court’s interpretation of the statutes granting it jurisdiction, perhaps Congress could step in and fix this problem so that all bases for jurisdiction in the Tax Court are considered non-jurisdictional and not just whistleblower cases, passport revocation cases and CDP cases filed by DC residents.