Court Opinion

ID: 3029850
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:43:29.294957+00
Date Added: 2024-06-11T11:04:59.738069
License: Public Domain

NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS                            FILED
                           FOR THE NINTH CIRCUIT                              DEC 02 2009

                                                                          MOLLY C. DWYER, CLERK
                                                                            U.S. COURT OF APPEALS

JOHN C. BEDROSIAN; et al.,                       Nos. 08-70508, 08-70548,
                                                      08-70809
             Petitioners - Appellants,
                                                 Tax Ct. Nos. 24581-06, 9664-07,
  v.                                                          12341-05

COMMISSIONER OF INTERNAL
REVENUE,                                         MEMORANDUM *

             Respondent - Appellee.

                     Appeal from the United States Tax Court
                       Juan F. Vasquez, Judge, Presiding

                      Argued and Submitted October 7, 2009
                              Pasadena, California

Before: HALL, W. FLETCHER and CLIFTON, Circuit Judges.

       Petitioners-Appellants John and Judith Bedrosian appeal three orders of the

Tax Court dismissing in whole or in part their challenges to three different notices

relating to the same underlying adjustments for the tax years 1999 and 2000. We

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
have jurisdiction over two of these appeals under 26 U.S.C. § 7482(a)(1). We

affirm in part and dismiss in part.

      In the first appeal, the Bedrosians challenge a notice of final partnership

administrative adjustment (FPAA) that the IRS mailed on April 8, 2005, pursuant

to 26 U.S.C. § 6223(a)(2). The FPAA asserted adjustments to the 1999 tax return

of Stone Canyon Partners, a short-lived partnership formed by two companies of

which the Bedrosians are the sole owners. The FPAA invalidated transactions

between the closely held companies and the partnership, disallowed a loss claimed

by the partnership, and imposed an accuracy-related penalty. The Bedrosians filed

a petition for readjustment of the FPAA in the Tax Court on May 1, 2007, more

than 90 days after the FPAA was mailed. See 26 U.S.C. § 6226(a). Because we

determine that the IRS validly mailed the FPAA to the Bedrosians, we affirm the

Tax Court’s dismissal for lack of jurisdiction of their untimely petition.

      The IRS mailed fourteen copies of the FPAA on April 8, 2005, to three

different addresses, including the same address provided for all three entities on the

Partnership’s tax return. The IRS did not mail the FPAA to the Bedrosians’

personal residence, which it had on file, because the Bedrosians’ accountant, who

had their power of attorney, asked the IRS not to use that address, citing security

concerns. The Bedrosians assert that they did not receive the FPAA at any address.

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      We find it unnecessary to decide whether constitutional due process requires

the IRS to mail an FPAA to the “last known address” of a tax matters partner

despite the absence of any such requirement in the Code. The address provided by

the Bedrosians’ accountant was the last known address, because it would have

qualified as “clear and concise notification” of a changed address if the last-

known-address standard that applies to a notice of deficiency governed here. See

26 C.F.R. § 301.6212-2; Rev. Proc. 2001-18 §§ 3.03, 5.04-05.

      The Tax Court correctly found that the power of attorney permitted the

accountant to change the Bedrosians’ own address for purposes of partnership-

related notices. The direct relationship between the Bedrosians’ tax returns and

those of the partnership makes the accountant’s communication of the Bedrosians’

address for partnership purposes relevant to her representation of the Bedrosians as

individual taxpayers. See England v. Lines, 262 F.2d 303, 305 (9th Cir. 1958)

(“The rule of construction which generally determines the scope of an agent’s

implied powers is that an agent has, ‘unless otherwise agreed, authority to do acts

which . . . are reasonably necessary to accomplish (the purpose of the agency).’”)

(quoting Restatement of Agency § 35). Moreover, the Bedrosians were indirect

partners by virtue of their undivided ownership interest in the pass-thru partner

companies. Therefore, the IRS was entitled to use “information furnished . . . by

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any other person” to establish their “name, address, and profits interest” and even

to use it “in lieu of the names, addresses, and profits interests of the pass-thru

partners.” 26 U.S.C. § 6223(c)(2), (3) (emphasis added); see also 26 C.F.R. §

301.6223(c)-1T(f) (2000).

      The Bedrosians also appeal from the Tax Court’s partial dismissal of a case

involving a notice of deficiency for their 1999 and 2000 tax years that the IRS

issued on April 19, 2005, eleven days after the IRS mailed the FPAA. Because the

Tax Court only dismissed the case in part, retaining jurisdiction over the

Bedrosians’ claimed deduction for legal, accounting, consulting, and advisory fees

related to the partnership, there is no final judgment as to all claims, and we

dismiss the appeal for lack of jurisdiction. See Brookes v. Comm’r, 163 F.3d 1124,

1126 (9th Cir. 1998).

      Finally, the Bedrosians appeal the Tax Court’s dismissal for lack of

jurisdiction of their petition on an affected item notice of deficiency that the IRS

issued on September 5, 2006, pursuant to 26 U.S.C. 6230(a)(2)(A)(i) after the

expiration of the 150-day window for filing a petition for readjustment in the

partnership proceeding. See 26 U.S.C. § 6226(b). The Tax Court properly

dismissed the petition because the 2006 affected item notice of deficiency was

issued after the Bedrosians remitted, and the IRS assessed, pursuant to 26 U.S.C. §

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6213(b)(4), the full amount of the deficiency asserted therein. The Bedrosians did

not designate their remittance as a deposit, which would have prevented its

assessment. See 26 U.S.C. § 6603(a); Rev. Proc. 2005-18 § 4.01. They argue that

their undesignated remittance should be treated as a deposit rather than an

assessable payment nonetheless, because they remitted “after the mailing of a

notice of deficiency”—in this case, the 2005 notice of deficiency. 26 U.S.C. §

6213(b)(4). “Such payment shall not deprive the Tax Court of jurisdiction over

such deficiency.” Id. (emphasis added). But both parties concede that the 2005

notice of deficiency was invalid because it was issued while partnership

proceedings were pending. No assessment could possibly deprive the Tax Court of

jurisdiction over that particular deficiency, because the Tax Court never had

jurisdiction over “such deficiency” in the first place. The 2006 affected item notice

of deficiency, by contrast, properly asserted deficiencies on affected items after the

FPAA became final. The Bedrosians’ remittance was properly assessed before the

issuance of the 2006 affected item notice of deficiency, so the Tax Court did not

err in dismissing the case for lack of jurisdiction.

      AFFIRMED in 08-70508 and 08-70548; DISMISSED for lack of

jurisdiction in 08-70809.

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