Opinion
3464-23
07-29-2024
THOMAS D. ANNUNZIATA & ROXANNE ANNUNZIATA, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Kathleen Kerrigan Chief Judge
By notice of deficiency dated January 19, 2023, respondent determined deficiencies in petitioners' federal income tax for the taxable years 2018 and 2019 and an overpayment in petitioners' federal income tax for the taxable year 2020. On March 15, 2023, petitioners filed the Petition to commence this case, seeking to invoke our deficiency jurisdiction for each of those three years. In response, on May 4, 2023, respondent filed a Motion to Dismiss for Lack of Jurisdiction as to 2020 on the ground that the notice determined an overpayment rather than a deficiency for that year. Petitioners oppose the Motion. For the reasons that follow, we must grant respondent's Motion.
This Court has jurisdiction only for a taxable year in which a deficiency has been determined. See §§ 6211, 6213(a), 6214(a), (b); Dick v. Commissioner, T.C. Memo. 1984-2 (collecting cases) (dismissing taxable year 1978 for lack of jurisdiction where notice determined overpayment for that year but deficiencies for later years), aff'd, 760 F.2d 264 (4th Cir. 1985); Gallo v. Commissioner, T.C. Memo. 1975-366 (collecting cases) (dismissing taxable year 1970 for lack of jurisdiction where notice determined overpayment for that year but deficiencies for earlier years); see also Sohn v. Commissioner, T.C. Memo. 1984-588 ("It is settled beyond the slightest doubt that the Commissioner must determine a deficiency against the taxpayer for any year in order for the Tax Court to have jurisdiction over the taxpayer for that year."). As noted above, the notice of deficiency in this case determined deficiencies for 2018 and 2019 but an overpayment for 2020. Because no deficiency has been determined for 2020, we are without jurisdiction over petitioners for that year.
Unless otherwise indicated, statutory references are to the Internal Revenue Code, Title 26 U.S.C., in effect at all relevant times.
Petitioners' arguments have not persuaded us to depart from this well-settled precedent. Among other things, petitioners (who according to the Petition are the sole members of M2S Marketing, LLC (M2S)) argue that respondent's position "is erroneous insofar as it conflates and confuses several determinations the IRS made with respect to the Petitioners' and M2S's tax returns for taxable year 2020 which, when properly parsed to identify those determinations specifically to taxes that arose separately under Chapter 1, Chapter 2 and Chapter 2A, show that Congress intended this Court have jurisdiction over that taxable year along with taxable years 2018 and 2019."
The essence of petitioners' argument is that, rather than considering a "net deficiency" (as petitioners term it), the Court must look at the separate determinations made in the notice because "the IRS actually increased the Petitioners' net taxable income by $340,193 and their Chapter 1 tax by $125,872 in taxable year 2020," but separately "decreased the Petitioners' net income from self-employment, which culminated in a net overpayment of their 'other tax' (Chapter 2 and Chapter 2A) liability in the amount of $198,107." As petitioners further argue, "the IRS then conflated the two separate determinations and declared 'Voilà!' there is no 'net deficiency' and thus no jurisdiction." In other words, it is petitioners' argument that, for purposes of our jurisdiction, the taxes imposed under Chapter 1, Chapter 2, and Chapter 2A should each be considered separately in determining whether a deficiency exists for any given year.
However, petitioners' argument ignores the plain language of section 6211; what petitioners argue is a "net deficiency," is in fact a "deficiency" as such is defined and calculated under the statute. And our jurisdiction is purely statutory; the assertion of a deficiency by the Commissioner is a necessary predicate to the exercise of our power. Martz v. Commissioner, 77 T.C. 749, 754 (1981). And where, as here, the Commissioner makes adjustments to a taxpayer's income which are completely offset by other adjustments such that the section 6211 deficiency calculation indicates no additional tax due for that year, this Court simply lacks jurisdiction. Ibid. Accordingly, petitioners' argument must be rejected.
We have considered all of petitioners' other arguments, and, to the extent not addressed herein, we conclude that they are moot, irrelevant, or without merit.
Upon due consideration of the foregoing, it is
ORDERED that respondent's above-referenced Motion is granted, and this case is dismissed for lack of jurisdiction as to the taxable year 2020. All references in the Petition to the taxable year 2020 are deemed stricken.