On June 30, 2020, the Tax Court issued a Memorandum Opinion in the case of Nguyen v. Commissioner (T.C. Memo. 2020-96). The basic, threshold issue before the court in Nguyen v. Commissioner was whether the petitioner may challenge his underlying liability in the Tax Court.
Brief Background to Nguyen v. Commissioner
the IRS sent, by certified mail, a notice of deficiency for the years in issue to the petitioner at his last-known address. The notice included IRC § 6662(a) accuracy-related penalties. An IRS certified mail list bears a U.S. Postal Service (USPS) stamp dated the day of mailing, and the envelope addressed to the petitioner’s last-known address was stamped by the USPS to show that the item was unclaimed and the USPS was unable to forward it. The IRS assessed the penalties and filed a NFTL, mailed to the petitioner (at his last known address), which the petitioner received, and he timely petitioned the Tax Court for review.
Testimony Regarding Non-Receipt
If a notice of deficiency is properly mailed to the taxpayer at his last known address, the notice may be valid even if the taxpayer did not receive it. See, e.g., United States v. Zolla, 724 F.2d 808, 810 (9th Cir. 1984); Hoyle v. Commissioner, 131 T.C. 197, 200 (2008), supplemented by 136 T.C. 463 (2011). Even if the notice was properly mailed, the taxpayer may be able to challenge the underlying tax liabilities if he can establish that no notice was received. Hoyle, 131 T.C. at 199; Snodgrass v. Commissioner, T.C. Memo. 2016-235, at *14-*15. The Tax Court may look at the taxpayer’s history of responding to notices to determine the likelihood of non-receipt. Mason v. Commissioner, 132 T.C. 301, 318-19 (2009) (holding that a taxpayer did not deliberately avoid delivery of a notice of deficiency when she had received and took appropriate action in response to the IRS’s other mailed notices and documents); Tatum v. Commissioner, T.C. Memo. 2003-115, *3-*4 (same).
However, a taxpayer who did not receive a notice of deficiency still could not challenge his underlying tax liabilities before this Court when he had a prior opportunity to do so in an administrative hearing with IRS Appeals. Lander v. Commissioner, 154 T.C. No. 7, *28-*33) (Mar. 12, 2020).
Merely Raising Liability in Hearing Request Not Enough to Preserve Right to Challenge Underlying Liability in Tax Court
An issue is not properly raised at the administrative hearing if the taxpayer fails to request consideration of the issue or if he requests consideration but fails to present any evidence after being given a reasonable opportunity to do so. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013); McRae v. Commissioner, T.C. Memo. 2015-132, *8-*9. In the present case, the petitioner promised to provide evidence to Appeals, but never delivered such evidence. Therefore, he never properly raised or supported his non-liability for the assessed taxes and penalties. As a consequence, the petitioner was prohibited from contesting them before the Tax Court. See LG Kendrick, LLC v. Commissioner, 146 T.C. 17, 39 (2016), aff’d, 684 F. App’x 744 (10th Cir. 2017); Pough v. Commissioner, 135 T.C. 344, 349 (2010).
(T.C. Memo. 2020-97) Nguyen v. Commissioner
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