11 Seconds Late

Imagine this. You have an appointment with your doctor and show up 11 seconds late. Sorry, they say, you missed your appointment. Come back another day.

That’s not going to happen at your doctor’s office, but something worse than that happened to a taxpayer named Sanders in Tax Court. He received a notice of deficiency from the IRS. This is a formal notification that they believe you owe more tax than the amount shown on your return. Sometimes we call it a 90-day letter because that’s how long you have to file a petition in Tax Court if you disagree.

You can file by mail, but the Tax Court also provides a way to file online. This method allows you to save on postage (you’d want to use certified mail) and to file the petition any time up until midnight on the last day. Sanders filed 11 seconds after midnight.

One of the strictest rules, not just in taxation but in law generally, says that a court cannot even consider a case if it doesn’t have jurisdiction. The Tax Court doesn’t have jurisdiction when a petition is filed after the deadline. Sanders was able to show that he tried to file before midnight, but ran into technical glitches of some kind. Yet the court found that the filing system was working properly, so any technical problems were at Sanders’ end. Case dismissed.

Sanders is not necessarily out of luck. He can still take the IRS to court. The catch is, he has to pay the tax before he can do this, then sue to get the money back — much more difficult than making your argument in Tax Court without having paid first. Depending on the amount of tax involved and the nature of the dispute (facts not mentioned in the Tax Court’s opinion), the technical problems that made his petition 11 seconds late may have effectively deprived Sanders of the opportunity to challenge the IRS’s determination.

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