Abdo v. Comm'r of Internal Revenue

R issued Ps a notice of deficiency dated December 2, 2019. The notice specified March 2, 2020, as the last day to petition the Court. That date was not a Saturday, Sunday, or legal holiday in the District of Columbia. Ps mailed the Petition on March 17, 2020.

Ps resided in Ohio at all relevant times. On March 31, 2020, the President issued a major disaster declaration under the authority of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. §§ 5121- 5207, with respect to Ohio as a result of the COVID-19 pandemic. The declaration identified the disaster conditions as "beginning on January 20, 2020, and continuing."

On September 2, 2020, R filed a Motion to Dismiss for Lack of Jurisdiction on the ground that the Petition was not filed within the time prescribed by I.R.C. § 6213(a) or I.R.C. § 7502. Ps contend that I.R.C. § 7508A(d), which provides for a mandatory 60-day extension of certain tax-related deadlines by reason of a federally declared disaster, operated in conjunction with the President's declaration to automatically extend the filing deadline.

On June 11, 2021, final regulations were issued with respect to I.R.C. § 7508A(d). See Treas. Reg. § 301.7508A-1(g). R contends that the regulations apply to this case, that they are entitled to deference under Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (1984), and that the Petition was untimely filed under their provisions. Ps agree that Chevron provides the proper framework for the Court to review the regulations and that the deadline to file their Petition was not extended under the regulations. Ps contend, however, that the Petition was timely under all reasonable constructions of I.R.C. § 7508A(d) and that Treas. Reg. § 301.7508A-1(g)(1) and (2) is invalid.

Held: I.R.C. § 7508A(d) provides for an unambiguously self-executing postponement period for the filing of a petition with the Court for a redetermination of a deficiency.

Held, further, Treas. Reg. § 301.7508A-1(g)(1) and (2) is invalid to the extent it limits the non-pension-related "time-sensitive acts that are postponed for the mandatory 60-day postponement period . . . [to] the acts determined to be postponed by the Secretary's exercise of authority under [I.R.C. §] 7508A(a)."

Held, further, Ps were entitled to an automatic, mandatory 60-day postponement period from January 20, 2020, to at least March 20, 2020, to file their Petition. Ps' Petition was filed timely, and we have jurisdiction. R's Motion will be denied.

Megan L. Sullivan and David L. Meenach, for petitioner.

Louis H. Hill and Eric O. Young, for respondent.

OPINION

MARSHALL, Judge

This deficiency case is before the Court on respondent's Motion to Dismiss for Lack of Jurisdiction (Motion) on the

ground that the petition was not filed within the time prescribed by section 6213(a)^[1] or section 7502. To decide the Motion, we must interpret for the first time section 7508A(d), which provides for the mandatory 60-day extension of certain tax-related deadlines by reason of a federally declared disaster.^[2] We will deny respondent's Motion for the reasons set forth below.

Background

The following facts are derived from the pleadings, the parties' Motion papers, and the Exhibits attached thereto. These facts are stated solely for the purpose of ruling on the Motion and not as findings of fact in this case. See Rule 1(b); Fed.R.Civ.P. 52(a); Pearson v. Commissioner, 149 T.C. 424, 425 (2017). Petitioners resided in Ohio at all relevant times.^[3]

Respondent issued petitioners a notice of deficiency dated December 2, 2019, in which respondent determined a $9,634 income tax deficiency and a $166 accuracy-related penalty under section 6662(a) for petitioners' taxable year 2018. The 90th day after December 2, 2019, was Sunday, March 1, 2020. The notice of deficiency specified the following day, March 2, 2020, as the last day to petition the Court. That date was not a Saturday, Sunday, or legal holiday in the District of Columbia. The parties agree that petitioners mailed their Petition to the Court on March 17, 2020.

Between March 19 and July 9, 2020, the Court did not receive mail because of the Court's closure in response to the Coronavirus

Disease 2019 (COVID-19) pandemic. On July 10, 2020, the Court received and filed the Petition.

On March 13, 2020, the President of the United States declared a nationwide emergency under section 501(b) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act), 42 U.S.C. §§ 5121-5207, as a result of the COVID-19 pandemic (Nationwide Emergency Declaration). See Letter to Federal Agencies on an Emergency Determination for the Coronavirus Disease 2019 (COVID-19) Pandemic Under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, 2020 Daily Comp. Pres. Doc. 159 (Mar. 13, 2020). The President also approved major disaster declarations for each of the 50 states pursuant to section 401 of the Stafford Act. On March 31, 2020, Pete Gaynor, the administrator of the Federal Emergency Management Agency (FEMA), at the direction of the President, signed DR-4507-OH (Ohio Disaster Declaration), which declared the State of Ohio a major disaster area. See Ohio; Major Disaster and Related Determinations, 85 Fed.Reg. 26,702 (May 5, 2020). As with each other state disaster declaration, the Ohio Disaster Declaration identified the pandemic conditions warranting the declaration as "beginning on January 20, 2020, and continuing." See id. at 26,703.

The Internal Revenue Service (IRS) subsequently issued a series of notices in which the stated purpose was to provide relief under section 7508A(a) pursuant to the Nationwide Emergency Declaration. Section 7508A(a) generally gives the Secretary of the Treasury (Secretary) or his delegate (i.e., the IRS) the discretion to postpone certain tax-related deadlines for up to one year for those taxpayers he or it determines to be affected by a federally declared disaster.^[4] Included in this series of IRS notices was I.R.S. Notice 2020-23, 2020-18 I.R.B. 742, which was issued on April 11, 2020.^[5] Among other specified deadline extensions, Notice 2020-23 extended the deadline for filing a Tax Court petition to July 15, 2020, for those taxpayers who had a petition due to be filed on

or after April 1, 2020, and before July 15, 2020. Id. at 743-44. Notice 2020-23 specified, however, that it did not provide relief for the period for filing a petition if that period expired before April 1, 2020. Id. at 744.

On September 2, 2020, respondent filed the Motion on the ground that the Petition was not filed within the time prescribed by section 6213(a) or section 7502. Section 6213(a) provides, in pertinent part, that a taxpayer may file a petition with the Court for a redetermination of a deficiency within 90 days after the notice of deficiency is mailed, not counting Saturday, Sunday, or a legal holiday in the District of Columbia as the last day. Section 7502 generally allows a timely mailed petition to be treated as timely filed.

On October 8, 2020, petitioners filed a Response to respondent's Motion. Proceeding pro se, petitioners stated in the Response that they did not receive a copy of respondent's Motion and requested a copy. Thereafter, on October 19, 2020, petitioners filed a First Supplement to their Response to respondent's Motion. In the First Supplement, petitioners stated: "We suggest the Tax Court has jurisdiction to hear our case, and to mitigate to 'zero' the IRS assessment and return the withheld refunds. We request the Tax Court to set a trial date in Columbus, OH."

On November 19, 2020, counsel entered an appearance on petitioners' behalf and filed petitioners' Supplemental Objection to respondent's Motion. In that filing, petitioners contended that section 7508A(d) operated in conjunction with the Ohio Disaster Declaration to extend the deadline to file their Petition. Subsection (d) was added to section 7508A on December 20, 2019, and made effective with respect to federally declared disasters declared after that date. Further Consolidated Appropriations Act, 2020, Pub. L. No. 116-94, div. Q, § 205, 133 Stat. 2534, 3245-46 (2019). On January 13, 2021, the Treasury Department and the IRS proposed regulations with respect to section 7508A(d). See Prop. Treas. Reg. § 301.7508A-1(g), 86 Fed.Reg. 2607, 2613 (Jan. 13, 2021). On February 12, 2021, respondent filed a reply to petitioners' supplemental objection, disputing that section 7508A(d) applies in this case. On June 11, 2021, the Treasury Department and the IRS issued final regulations with respect to section 7508A(d). See Treas. Reg. § 301.7508A-1(g); T.D. 9950, 86 Fed.Reg. 31,146, 31,150 (June 11, 2021). The final regulations were issued following notice and comment procedures. See T.D. 9950, 86 Fed.Reg. at 31,147; Prop. Treas. Reg. § 301.7508A-1, 86 Fed.Reg. at 2607-08. In correspondence with subsection (d), the final regulations were made effective with respect to

disasters declared on or after December 21, 2019. See T.D. 9950, 86 Fed.Reg. at 31,149-50.

On August 29, 2023, the Court ordered the parties to address the applicability of the final regulations to this case and the deference, if any, to be given to the regulations. On October 31, 2023, the parties filed their respective simultaneous briefs. On November 6, 2023, the Court permitted the parties to file simultaneous answering briefs, which were filed by respondent and petitioners on November 30, 2023, and December 1, 2023, respectively.

Respondent contends that the final regulations apply to this case, they are entitled to deference under Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467...