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Timely Filed IRS Documents and the Mailbox Rule

By Joel N. Crouch on February 8, 2021
In a prior blog post, I discussed when the statute of limitation for the IRS assessing tax starts. The simple answer is, the statute of limitations starts when the tax return is filed. I recently read a case, Taha v. United States, which is being appealed by the taxpayer to the Federal Circuit Court of Appeals and involves a refund claim, the statute of limitations and the common law “mailbox rule”.

The mailbox rule says that documents properly addressed and deposited in the U.S. mail by taxpayers are presumed to have been physically received by the IRS at the time such a mailing would ordinarily take to arrive. Under the mailbox rule, courts have allowed proof of mailing to be established by testimonial or circumstantial evidence.

In 1954, Congress enacted IRC § 7502 which provides that a tax document is timely filed if it is:

1. Deposited in the U.S. mail in a properly addressed envelope with adequate
2. Postmarked on or before the prescribed filing date; and
3. Actually delivered by the U.S. mail.
In 2011, the IRS finalized regulations which state that the common law mailbox rule is no longer available and a document must actually be received by the IRS to be timely. However, the regulations include an exception that if the taxpayer uses registered or certified mail or a duly designated private delivery service, actual delivery is not required. The regulations further state that “no other evidence of a postmark or of mailing will be prima facie evidence of delivery or raise a presumption that the document was delivered”.

In Taha v. United States, the taxpayer filed tax refund claims for the years 2002, 2003, and 2004 by regular mail. The refund claims were partially denied and the taxpayer filed suit in the Court of Federal Claims. In response to the IRS position that the refund claims were not timely filed, the taxpayer testified that he timely mailed the refund claims to the IRS. The court held that although the taxpayer’s testimony regarding mailing was credible, the 2011 regulations limited proof of timely filing to certified or registered mail or by use of a duly designated private delivery service. Since the taxpayer did not comply with the regulations, the court ruled in favor of the IRS. The taxpayer has appealed the decision to the Federal Court of Appeals arguing that IRC § 7502 was not intended to do away with the common law mailbox rule and that the regulations are not consistent with the intent of IRC § 7502.

There is a simple lesson to be learned from the situation in which the Taha taxpayers find themselves, i.e., taxpayers should always use certified or registered mail when sending a document to the IRS, especially a tax return or refund claim. Failure to do so, increases the risk the IRS will raise the timely filing question.

For questions regarding this blog post or any other civil or criminal tax related matter, please feel free to contact Joel Crouch at (214) 749-2456 or jcrouch@meadowscollier.com.