Tax Court Holds Petition Was Filed Late Due to Private Delivery Service Method Used

The Tax Court on April 18 issued an order dismissing a petition for lack of jurisdiction because it was mailed via FedEx Express Saver, which is not an acceptable mailing method, and was received by the court two days after the petition deadline.

Background

Internal Revenue Code Section 7502 includes a so-called “timely mailed, timely filed” rule, which provides that if any return, claim, statement, or other document required to be filed within a prescribed period or on or before a prescribed due date is delivered after such period or date, the date of the postmark will be deemed to be the date of filing. For example, a return mailed on April 15 and delivered to the IRS on April 19 will be deemed filed on April 15 if the mailing meets the requirements of Section 7502. This rule also applies to certain payments required to be made within a prescribed period or on or before a prescribed date, and to filings with the Tax Court. 

The benefit of the timely mailed, timely filed rule is available only if the postmark date falls within the prescribed period or on or before the prescribed due date, and if the mailing was done in an envelope or other appropriate mailer, the postage was paid, and it was properly addressed. Additionally, the postmark must be made either by the United States Postal Service or by certain private delivery services as specified in the regulations under Section 7502.  

Generally, a taxpayer cannot rely on the timely mailed, timely filed rule unless the document in question is actually delivered, in which case the postmark date controls, as explained above. However, the regulations under Section 7502 provide an exception to the “actual delivery” rule if the mailing is done by certified or registered mail or via certain private delivery services. In those situations, proof (such as a certified or registered mail receipt or private delivery service tracking confirmation) that the document was sent using an approved mailing method will constitute prima facie evidence that the document was delivered. Other than actual delivery, proof of proper use of registered or certified mail or proof of proper use of a designated private delivery service are the exclusive means to establish evidence of delivery.  

In Notice 2016-30, the IRS updated the list of private delivery services that would satisfy the requirements under section 7502. These include various shipping options from FedEx, UPS, and DHL Express. Any method of mailing via a private delivery service that is not enumerated in Notice 2016-30 will not constitute a valid postmark, nor can it be used as evidence of timely mailing. For example, the notice allows overnight or two-day service, but generally not three-day or ground service.

Tax Court Ruling

In Lynch v. Comm’r, T.C. No. 1398-24 (Apr. 18, 2024), the Tax Court held that a petition mailed via FedEx Express Saver, which is not one of the acceptable mailing methods for that private delivery service, was not timely filed when it was mailed on the due date and received by the court two days later. The court found that the postmark on the petition was not valid because Express Saver is not among the eight allowable services provided by FedEx under Notice 2016-30. 

In December 2023, the Tax Court held that a different FedEx delivery method that also was not listed in Notice 2016-30 similarly did not satisfy section 7502. Nguyen v. Comm’r, T.C. Memo. 2023-151 (Dec. 20, 2023). The taxpayers in that case argued that the FedEx Ground method they selected was substantially identical to one of the enumerated FedEx options, but the court held that it could not rely on general equitable principles to expand the statutorily prescribed time for filing a petition. The taxpayers in Nguyen have filed an appeal with the Tenth Circuit. 

Section 7502 explains that the allowable private delivery services are those that are generally available to the public, are at least as timely and reliable on a regular basis as the U.S. mail, and that record tracking information, including mailing and delivery dates. 

Given that the mailings in both the Lynch and Nguyen cases arrived two days after being mailed despite using unacceptable FedEx shipping methods, perhaps the IRS will take another look at the services allowed under Notice 2016-30 and provide an updated list in the near future.