T.C. Mem o. 2 01 3- 20 6

UNITED STAT ES TAX COURT

MARK EDWARD KEARNEY, Peti ti on er v . COMM ISSI ONER OF INTERNAL REVENUE, Resp on de nt

Doc ke t No . 50 52 -1 2. Fil edAug us t 2 9, 2 01 3.

Mark EdwardKearn ey , pro se. Kris ti n M . Bou rla nd , forres po nd en t.

MEMORANDUM FINDINGS OF FACT AND OPINION RUWE , Ju dg e: Res po nd en t d et erm in edde fic ie nc ie s, ad di ti on s t o t ax , and accu racy-rela te d p en al ti es with re sp ectto pe ti ti on er as fol lo ws:- 2 -

[* 2] Add it io n t o Tax Accura cy -rel at edPen al ty Year Defi ci en cy

Sec. 66 51 (a)( 1) Sec. 6 66 2( a) 20 08 $1 0,4 05 $2 ,60 1.2 5 $2 ,08 1.0 0 20 09 7,3 93 1,84 8.2 5 1,4 78 .60 20 10 36 ,91 5 3,6 89 .00 7,3 83 .00 Afte r co nc es si on s, th e o nl y is su e rem ai ni ng forde ci si onis whet he r 1 pe ti ti on er i s l iabl e fo r th e ad di ti on to tax un de r se ct io n 6 65 1( a)(1 ) forth e ta xabl e 2 y ear 2 01 0. FINDINGS OF FACT So m e o f th e fac ts ha ve be enst ip ul at edan d a re s o fo un d. Th e st ip ul at io n o f fact s, the st ip ul at io n o f se tt le d i ss ue s, the fir stsupp le m en ta l s ti pu la ti onof s et tl ed is su es , andth e at ta ch edex hi bi ts are i nc or po rat edhe rei n b y

th is refe ren ce. At the ti m e th e p et it io n was fil ed , pet it io ne r res id edinKentuc ky.
The pa rti es en te redin to a st ip ul at io n o f se tt le d i ss ue s, fi le d wi th th e Co urt 1 on Feb ru ary 4, 2 01 3, fo r al l o f th e is su es refl ect edinth e n ot ic e o f de fic ie nc y , ex cep t wh ethe r pe ti ti on er was all owe d ade du ct io n fo r of fic e ex pe ns es inex ces s o f th e am ou nt s al read y

all owe d b y

res po nd en t fo r th e ta xabl e y ears 20 08 an d 2 00 9 an d wh ethe r pe ti ti on er i s l iabl e fo r th e se c. 66 51 (a)( 1) ad di ti on to tax forth e ta xabl e y ear 2 01 0. Th e p art ie s en te redin to th e fi rs t s up pl em en ta l s ti pu la ti on of se tt le d i ss ue s, fi le d wi thth e Co urt o n M arch19 , 20 13 , res ol vi ng th e is su es of pe ti ti on er’s en ti tl em en t t o d educ ti on s fo r of fic e ex pe ns es forth e ta xabl e y ears 20 08 an d 2 00 9. Unl es s o th erwi se in di cat ed , all sec ti on refe ren ces are t o t he Int ern al 2 Rev enue Co de ineffe ctforth e y ear i n i ss ue , andall Ru le refe ren ces are t o t he Tax Co urt Ru le s o f Prac ti ce an d P ro cedur e.- 3 -

[* 3] Pet it io ne r fi le d h is Fed eral in co m e ta x re tu rnforth e ta xabl e y ear 2 01 0 o n May 20, 2 01 1. Th e return s ho weda refu nddu e o f $2 5. Re sp on de ntdi d n ot rece iv e a Fo rm

48 68 , App li cat io n fo r Aut om at ic Ext en si on of Ti m e To Fi le U.S. In di vi du al Inc om e Tax Return, fr om pe ti ti on er fo r th e ta xabl e y ear 2 01 0. On No ve m

be r 29 , 20 11 , res po nd en t i ss ue d t o p et it io ne r a n ot ic e o f de fic ie nc y

forth e ta xabl e y ears 20 08 , 20 09 , and20 10 . Peti ti on er t im el y fil eda pe ti ti on di sp ut in g t he de te rm in at io ns inth e n ot ic e o f de fic ie nc y . OPINION Res po nd en t h as th e b ur de n o f pr oduc ti on with re sp ectto th e se ct io n 66 51 (a)( 1) ad di ti on to tax . See s ec. 7 49 1( c). To m eetth is bu rd en , res po nd en t m us t p ro du ce ev id en ce s ho win g t ha t the ad di ti on to tax is ap pr op ria te . See i d.; Hig be e v . Comm is si on er, 1 16 T.C. 43 8, 4 46 (20 01 ). Once res po nd en t s at is fie s th is bu rd en , pet it io ne r ha s the bu rd enof p ro of with re sp ectto ex cu lp at ory fact or s su chas r eas on ab le cau se . See Hig be e v . Comm is si on er, 1 16 T.C. at 4 46 -4 47 . Sect io n 6 65 1( a)(1 ) im

po se s an ad di ti on to tax when a ta xp ay er fa il s t o fi le a ti m el y return u nl es s t he tax pa y er es tabl is he s tha t the fai lu re was du e to reas on ab le cau se an d n otwil lfu l n eg le ct . The ad di ti on to tax is equa l t o 5 % of t he am ou nt requi redto be sh own as t ax on th e d el in qu en t re turnforeach m on th or f ract io n- 4 -

[* 4] th ereo f du rin g wh ic h t he return re m ai ns de li nque nt , up to a m ax im um ad di ti on of 2 5% fo r returns m or e th anfou r m on th s d el in qu en t. Id
. Res po nd en t p ro du cedreco rd s s ho win g t ha t p et it io ne r di d n otti m el y fil e h is 20 10 Fed eral in co m e ta x re turnan d t ha t re sp on de ntdi d n otrece iv e a Fo rm 48 68 fro m pe ti ti on er. The refo re, res po nd en t h as m ethi s b ur de n o f pr oduc ti on . As a res ul t, p et it io ne r be ars th e b ur de n o f pr ov in g e it he r ti m el y fil in g o r rea so nabl e cau se an d l ackof wi ll fu l n eg le ct . See Hig be e v . Comm is si on er, 1 16 T.C. at 4 46 . An i nd iv idua l t ax pa y er i s re qu ire d t o fi le a ta x re turnon or b efo re the 15 th da y of Ap ril fol lo win g t he clo se of t he cal en da r y ear. Se c. 60 72 (a). Fo r th e 2 01 0 ta xabl e y ear, the Co m

m is si on er ex te nd edth e fi li ng de ad li ne fortax returns to Apr il 18 , 20 11 , bec au se in20 11 , Em an ci pa ti on Day , a ho li da y ob se rv edinth e Dis tri ctof C ol um

bi a, fel l o n F rid ay , Apri l 1 5. Se e I.R.S. News Rel eas e IR- 20 11
- 01 (Ja n. 4 , 20 11 ). Sect io n 1 .60 81 -4 , Inc om e Tax Reg s., p ro vi de s tha t a t ax pa y er ca n o bt ai n a n au to m at ic si x- m on th ex te ns io n o f ti m e fo r fi li ng a return. To rece iv e th e ex te ns io n a ta xp ay er m

us t fi le anap pl ic at io n o n F orm 48 68 with the Int ern al Rev enue Serv ic e o ffi ce d es ig na te d i n t he Fo rm 48 68 in st ru ct io ns by the ori gi na l d ead li ne fo r fi li ng th e return. Se c. 1.6 08 1- 4( b) (1 ), (2 ), an d (3 ), In co m e Tax Reg s. A fi li ng

“ is no t co m

pl et e unt il th e d oc um en t i s d el iv eredan d re cei ve d.” Uni te d S ta te s v .- 5 -

[* 5] Lom ba rd o, 2 41 U.S. 73 , 76 (19 16 ); s ee Tes or ie ro v. Co m m is si on er, T.C. Mem o. 2 01 2- 26 1, at*6 -* 7. “ Thu s, a Fo rm 48 68 can no t b e p ro pe rly fil edun ti l i t 3 is de li ve redan d re cei ve d a t the ap pr op ria te Int ern al Rev enue Serv ic e lo cat io n.” Sp an ne r v. C omm is si on er, T.C. Mem o. 1 98 8- 43 5, 1 98 8 Tax Ct. M em o LEXIS 46 1, at*8
. Res po nd en t p ro du cedreco rd s d em on st rat in g t ha t h e d idno t re cei ve a Fo rm 48 68 fro m

pe ti ti on er. Howe ve r, pe ti ti on er t es ti fie d t ha t h e h adfil eda Fo rm 48 68 with re sp on de nt . There fol lo wedth is co ll oquy:

THE COURT: Wha t ev id en ce i s the re tha t you d idfil e th at reque st ? [PETITIONER]: Prio r y ears , hab it
. THE COURT: Pri ory ears . So yourtes ti m on y is y oudi d i t ev ery y ear? [PETITIONER]: Every y ear, yeah. AndI can ’t ans wer i t, y ou kn ow. The re’s n o way, y oukn ow. I h av e n o e vi de nc e to off er tha t I fil edth aty ear, ex cep t tha t I fi le d e ve ry y ear p rio r. Pet it io ne r di d n otpro vi de a co py of th e Fo rm 48 68 or apo st al rece ip t, o r an y ev id en ce b es id es hi s t es ti m on y , to pro ve th athe m ai le d aFo rm 48 68 .

Thi s re qu ire m en t i s kno wn as th e p hysic al de li ve ry rul e. See M il le r v. 3 Uni te d S ta te s, 7 84 F.2d72 8, 7 30 (6t h C ir. 1 98 6)
.- 6 -

[* 6] Thi s C ou rt h as all owe d t ax pa y ers to pro ve de li ve ry th ro ug h o th er ex tri ns ic
ev id en ce, s uc h a s t es ti m on y th atth ey m ai le d t he do cu m en t. See Est at e o f W oo d v
. Co m m is si on er, 9 2 T.C. 7 93 , 79 9- 80 0 (1 98 9) , aff’d, 9 09 F.2d11 55 (8t h C ir. 1 99 0)
. Howev er, p ro of

of d el iv ery “ requi res so m e p ro of th atth e return was pl acedinan en ve lo pe , pro pe rly addres se d, s ta m pe d, an d p la cedinth e m ai l.” Lo ng azel v. Co m m is si on er, T.C. Mem o. 1 99 4- 48 7, 1 99 4 Tax Ct. M em o LEXIS 4 99 , at * 12 . Pet it io ne r di d n ottes ti fy

to an y of t he se sp eci fic act io ns . Ins te ad , pet it io ne r’s te st im on y co nc ern edhi s h ab itof m ai li ng Fo rm 48 68 inpre vi ou s years.

“ Test im on y

ab ou t p et it io ne r’s li ke ly acti on s, o r hi s h ab it s re gard in g m ai li ng returns , is no t s uf

fic ie nt ” to pro ve de li ve ry . Id.; see W each oc k v . Comm is si on er, T.C. Mem o. 1 99 9- 42 8, 1 99 9 Tax Ct. M em o LEXIS 4 85 , at * 4- *5
. Fu rth erm or e, pe ti ti on er h as a reco rdof d el in qu en t fi li ng s. Pet it io ne r was gr an te d a n e xt en si on of t im e unt il Octo be r 15 , 20 09 , to fil e h is 20 08 Fed eral in co m e ta x re tu rn . Howev er, p et it io ne r fi le d h is 20 08 Fed eral in co m e ta x re tu rn on Feb ru ary 22 , 20 10 , fou r m on th s af te r th e ex te nd edfil in g d at e. Pet it io ne r was gr an te d a n e xt en si on of t im e unt il Octo be r 15 , 20 10 , to fil e h is 20 09 Fed eral in co m e ta x re tu rn . Howev er, p et it io ne r fi le d h is 20 09 Fed eral in co m e ta x re tu rn on Ju ne 17 , 20 11 , eig htm on th s af te r th e ex te nd edfil in g d at e. The p art ie s- 7 -

[* 7] st ip ul at edth atpe ti ti on er i s l iabl e fo r th e se ct io n 6 65 1( a)(1 ) ad di ti onto tax for th e ta xabl e y ears 20 08 an d 2 00 9. Pet it io ne r ha s n otpro du cedan y ev id en ce i nd ic at in g t ha t h is fai lu re t o fi le a Fed eral in co m e ta x re tu rnfor 20 10 was due to reas on ab le cau se . Accor di ng ly, we ho ldth atpe ti ti on er i s l iabl e fo r th e ad di ti on to tax un de r se ct io n 6 65 1( a)(1 ) fo r th e ta xabl e y ear 2 01 0. To re fle ctth e fo reg oi ng , Deci si on wil l b e en te redun de r Ru le 15 5.