Opinion ID: 491560
Heading Depth: 3
Heading Rank: 2

Heading: Administrative Defects

Text: 57 The IRS revoked the Church's tax exempt status by letter dated July 18, 1967. After fruitless negotiations, the IRS issued a notice of deficiency to the Church on June 7, 1974 covering the years 1965 through 1967. The Church argues that, because the IRS settled the case by stipulating that the Church owed no deficiency for 1965, the revocation letter was constructively revoked. Thus, argues the Church, the 1977 notice of deficiency, relating to the years 1970 through 1972, was void because the Church was still a recognized tax exempt organization. The Church cites A. Duda & Sons Cooperative Ass'n v. United States, 504 F.2d 970 (5th Cir.1974). 58 We disagree with the Church's analysis. Although the IRS abandoned its attempt to collect taxes for the years 1965 through 1967, it never abandoned its 1967 determination that the Church was no longer eligible for tax exempt status. In fact, the stipulation expressly stated that the concession was without prejudice to [the Church] or [the Commissioner] with respect to any other taxable year.... A. Duda & Sons is inapposite. In that case, the Commissioner expressly conceded that the grounds for revocation were erroneous. 504 F.2d at 975. In this case, the Commissioner never made such a concession; in fact today we hold that one of the stated grounds, inurement, was valid. In sum, we hold that the 1967 revocation letter was not constructively revoked.