Opinion
9135-19
07-07-2021
THADIEUS PHILLIP MCKINNON, Petitioner v. Commissioner of Internal Revenue, Respondent
ORDER AND ORDER OF DISMISSAL FOR LACK OF JURISDICTION
Patrick J. Urda, Judge
Petitioner Thadieus Phillip McKinnon petitioned this Court on June 4, 2019, asserting that he had received neither notices of deficiency nor notices of determination for his 1980-2017 taxable years. (Doc. 1. )
Unless otherwise indicated, all section references are to the Internal Revenue Code in effect at all relevant times, and all Rule references are to the Tax Court Rules of Practice and Procedure. "Doc." references are to the documents compiled in the docket index for this case.
The Commissioner moves to dismiss Mr. McKinnon's petition for lack of jurisdiction. (Doc. 13.) The Commissioner asserts that no notice of deficiency, or any other determination sufficient to confer jurisdiction, had been issued for Mr. McKinnon's taxable years 1980-1983, 1988, 1989, 1992-1999, 2001-2004, and 2010-2017 (agreed-upon years). (Id. at 3-8, 15-16, 19-23, 25-29, 34-36.) As to 1984-1987, 1990, 1991, 2000, 2005-2009 (disputed years), the Commissioner argues that, although the IRS had issued notices of deficiency, the case should be dismissed as untimely under section 6213(a). (Id. at 8-15, 16-19, 24-25, 29-34.) The Commissioner finally moves for a penalty under section 6673 for proceedings instituted primarily for delay and Mr. McKinnon's frivolous claims. (Id. at 36-39.)
We will dismiss this case and deny the motion to impose a penalty under Section 6673.
DISCUSSION
I. Jurisdictional Principles
Like all Federal courts, we are a court of limited jurisdiction, which we may exercise only to the extent authorized by Congress. Naftel v. Commissioner, 85 T.C. 527, 529 (1985). As the party invoking our jurisdiction, Mr. McKinnon bears the burden of proving the facts necessary to establish that we have jurisdiction over his case. See David Dung Le, M.D., Inc. v. Commissioner, 114 T.C. 268, 270 (2000), aff'd, 22 Fed.Appx. 837 (9th Cir. 2001); Savoy v. Commissioner, T.C. Memo. 2014-162, at *15, aff'd, 589 Fed.Appx. 187 (4th Cir. 2015). On his petition, Mr. McKinnon indicated that he was challenging both notices of deficiency and notices of determination.
As to the former, our jurisdiction to redetermine a deficiency depends on the issuance of a valid notice of deficiency and a timely filed petition. Rule 13(a), (c); Monge v. Commissioner, 93 T.C. 22, 27 (1989); Normac, Inc. v. Commissioner, 90 T.C. 142, 147 (1988). A notice of deficiency is valid, whether or not the taxpayer receives it, if it is mailed to the taxpayer's last known address by certified or registered mail. See sec. 6212(a) and (b); see also Yusko v. Commissioner, 89 T.C. 806, 810 (1987); Cherizol v. Commissioner, T.C. Memo. 2014-119, at *7. A taxpayer generally has 90 days from the date of the notice of deficiency to file a petition with this Court. Sec. 6213(a).
In the collection due process (CDP) context our jurisdiction depends upon the issuance of a valid notice of determination and the filing of a timely petition. See Rule 330(b); see also Smith v. Commissioner, 124 T.C. 36, 38 (2005). A notice of determination is valid if it is sent by certified or registered mail to a taxpayer at the taxpayer's last known address. See Weber v. Commissioner, 122 T.C. 258, 261-262 (2004). Section 6330(d)(1) sets a 30-day jurisdictional deadline for filing a petition in a CDP case.
Although both parties ostensibly agree upon the necessary prerequisites for our exercise of jurisdiction, the parties identify different defects for 1984-1987, 1990, 1991, 2000, 2005-2009, which would produce different results. "If respondent issued a valid notice of deficiency, the petition must be dismissed for lack of jurisdiction as untimely." Pietanza v. Commissioner, 92 T.C. 729, 735 (1989), aff'd, 935 F.2d 1282 (3d Cir. 1991). In that event, a taxpayer "would not be entitled to challenge the merits of the deficiency in this Court, but would be required to pay the full assessment and file a claim for refund prior to challenging the merits of the assessment in court through a suit for refund." Id. at 735-736. "However, if jurisdiction is lacking because of respondent's failure to issue a valid notice of deficiency, we will dismiss the case on that ground, rather than for lack of a timely filed petition." Id. at 736.
II. Analysis
A. Agreed-Upon Years
In his petition, Mr. McKinnon asserts that he did not receive notices of deficiency or notices of determination for the agreed-upon years. In his motion to dismiss, the Commissioner reports that he made a diligent search of IRS records, which showed no record, information, or other evidence indicating that a notice of deficiency, or other determination sufficient to invoke our jurisdiction, has been issued to Mr. McKinnon for any of the agreed-upon years. We will accordingly dismiss the petition as to the agreed-upon years on that ground.
B. Disputed Years
1. Deficiency Jurisdiction
As to the disputed years, Mr. McKinnon again claims that he did not receive notices of deficiency or notices of determination. (Doc. 1 at 1-2.) The Commissioner, however, asserts that his records indicate that notices of deficiency had been sent, with the last issued in 2012. (Doc. 13 at 33.) Although the Commissioner has not introduced the notices of deficiency sent for the disputed years, he has provided documentary information and a narrative explanation that established the dates of mailing. (Id. at 8-15, 16-19, 24-25, 29-34.)
The Commissioner represents that Mr. McKinnon owes no tax for 1984-1987, 1990, 1991, and 2000 (Doc. 13 at 8-14, 103, 106, 126), but that Forms 4340, Certificate of Assessments, Payments, and Other Specified Matters, show balances of $4, 520.58 for 2005 (id. at 153), $15, 346.87 for 2006 (id. at 158), $15, 206.48 for 2007 (id. at 165), $13, 262.23 for 2008 (id. at 171), and $12, 434.08 for 2009 (id. at 176).
Mr. McKinnon offers no evidence that disturbs the conclusion that the IRS properly issued notices of deficiency for the disputed years. He instead asserts that the IRS failed to comply with section 6065 and contends that all assessments are "null and void." (Doc. 14 at 2.) Mr. McKinnon is wrong. Section 6065 imposes requirements on documents filed by taxpayers and does not apply to the Commissioner. See Davis v. Commissioner, 115 T.C. 35, 42 (2000).
As Mr. McKinnon's petition was filed well after the expiration of the 90-day period set forth in section 6213(a), we lack jurisdiction over Mr. McKinnon's challenge to the notices of deficiency for the disputed years. See Pietanza v. Commissioner, 92 T.C. at 735; see also Pyo v. Commissioner, 83 T.C. 626, 632 (1984).
2. CDP Jurisdiction
Mr. McKinnon has likewise failed to carry the burden of proving our CDP jurisdiction by providing the necessary factual basis with respect to the disputed years. See Allen v. Commissioner, T.C. Memo. 2018-24, at *8-*9 (citing La. Naval Stores, Inc. v. Commissioner, 18 B.T.A. 533, 536 (1929); Consol. Cos. v. Commissioner, 15 B.T.A. 645, 651 (1929)). Mr. McKinnon has not introduced a notice of determination relating to these years, and the Commissioner reports that IRS records contain no evidence that any such notice of determination was mailed. We thus conclude that Mr. McKinnon has failed to satisfy his burden to prove that we have jurisdiction to consider any CDP claims regarding the disputed years.
III. Penalty Under Section 6673
The Commissioner moves to impose a penalty on Mr. McKinnon under section 6673, claiming that he instituted these proceedings for purposes of delay or that his position is frivolous and groundless. (Doc. 13 at 3, 36-38.) In support of his motion, the Commissioner points out that Mr. McKinnon's petition presented a meritless challenge that necessitated excessive and wasteful searches. (Id.)
For his part, Mr. McKinnon vaguely suggests that counsel for the Commissioner may be running afoul of section 7214, which addresses "unlawful acts of revenue officers or agents." (Doc. 14 at 2-3.) Mr. McKinnon, however, has failed to identify the purported unlawful acts of revenue officers or agents, much less convince us that any violations have occurred in this case.
Section 6673 authorizes us to impose a penalty of up to $25, 0000 where, among other things, a taxpayer's position is frivolous or groundless. We will not impose such a penalty against Mr. McKinnon, who, despite being dismissed twice for failing to pay our filing fee, has no previous history of making frivolous arguments in this Court, or engaging in conduct primarily for reasons of delay. He does now. We accordingly warn him that the section 6673 penalty looms should he advance similar arguments, or engage in similar conduct, in the future.
Accordingly, it is
ORDERED that so much of the petition as related to tax years 1980-1983, 1988, 1989, 1992-1999, 2001-2004, and 2010-2017, is dismissed for lack of jurisdiction, and the Commissioner's motion to dismiss for lack of jurisdiction is granted in that no notices sufficient to invoke our jurisdiction were issued for these years. It is further
ORDERED that so much of the petition as relates to tax years 1984-1987, 1990, 1991, 2000, and 2005-2009, is dismissed for lack of jurisdiction, and the Commissioner's motion to dismiss for lack of jurisdiction is granted in that the petition was not timely filed with respect to these years. It is further
ORDERED that so much of the Commissioner's motion to dismiss for lack of jurisdiction and to impose a penalty under section 6673 as seeks to impose a penalty under section 6673 is denied. It is further
ORDERED that Mr. McKinnon's motion to compel production of documents is hereby denied as moot.