The Tax Court held that a notice of deficiency sent to husband-and-wife taxpayers' previous home address shown on their latest filed tax return was valid, despite the fact they had listed their new address on Form 2848, Power of Attorney and Declaration of Representative, and Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, both sent to the IRS after the filing of their latest income tax return. According to the court, the two forms submitted by the taxpayers were not returns and did not provide the IRS with clear and concise notification of a different address for purposes of updating the taxpayers' last known address.
Facts: On June 30, 2015, Damian and Shayla Gregory moved from Jersey City, N.J., to Rutherford, N.J. The couple used the Jersey City address when they filed their 2014 federal income tax return on Oct. 15, 2015; however, when the couple submitted Form 2848 in November 2015, they used their new Rutherford address. They also used the new address in April 2016, when they submitted Form 4868 to extend the filing date for their 2015 income tax return. On Oct. 13, 2016, prior to the filing of their 2015 tax return, the IRS sent the Gregorys, by certified mail, a notice of deficiency to their Jersey City address that was subsequently returned to the IRS. On Jan. 17, 2017, more than 90 days after Oct. 13, 2016, the taxpayers became aware of the deficiency notice and filed a petition to the Tax Court.
Issues: For the Tax Court to have jurisdiction to hear a taxpayer's case, a taxpayer must petition the court for relief of a valid deficiency notice within 90 days of the date the notice was mailed to the taxpayer. One of the requirements of a valid deficiency notice is that it must be sent to the taxpayer's last known address. Under the regulations, the last known address is the address that appears on the taxpayer's most recently filed and properly processed federal tax return, unless the IRS has been given clear and concise notification of a different address. Rev. Proc. 2010-16 defines which federal forms are a "return" for this purpose and defines "clear and concise notification." Clear and concise notification can be oral, written, or electronic. Written notification includes completing and sending Form 8822, Change of Address, to the IRS or sending the IRS a signed written statement requesting a change in address that includes the taxpayer's full name, the old address, the new address, and the taxpayer's Social Security number (SSN) or other tax identification number.
Taxpayers may also contact the IRS in person or by phone and provide the following information: full name, date of birth, the old address, the new address, and the taxpayer's SSN or tax identification number. Taxpayers may notify the IRS electronically by using one of the Service's secure applications found at irs.gov.
Rev. Proc. 2010-16 specifically states that Form 2848 and Form 4868 are not considered returns for the purposes of changing an address. Nonetheless, the taxpayers argued that the filing of those two forms constituted clear and concise notification of their change in address.
Holding: The Tax Court held that the taxpayers had not provided the IRS with clear and concise notification of their address change; therefore the deficiency notice sent to the taxpayers' old address was valid and the taxpayers' petition for relief was not timely. According to the court, Rev. Proc. 2010-16 implies that Form 2848 and Form 4868 do not provide the IRS with clear and concise notification of an address change because Rev. Proc. 2010-16 specifically states that those forms will not be used to update the taxpayer's address of record. Furthermore, the court stated that Forms 2848 and 4868 cannot satisfy the requirements for written clear and concise notification because neither form informs the IRS that the taxpayer's address should be changed and neither form contains the taxpayer's old address.
- Gregory, 152 T.C. No. 7 (2019)
— By Charles J. Reichert, CPA, instructor of accounting, University of Minnesota—Duluth.