Date Printed Used as a Postmark Applied by Other than the USPS for Timely Filing Rule

The Tax Court, having been reversed on appeal by the Seventh Circuit Court of Appeals in a case with virtually identical facts, officially changed its position on how to determine if a document mailed with a mailing label meets the timely filing rules of IRC §7502.  In Pearson v. Commissioner, 149 TC No. 20, the Court rejected its prior position that entries in the U.S. Postal Service database amounted to the equivalent of U.S Postal Service applied postmark which took precedence over the mailing date.  Instead, a document mailed with a label (or any other sort of postage meter equivalent label) is tested under the regulations for a document with a postmark applied by other than the U.S. Postal Service.

While, as noted, this position had been adopted on appeal, reversing the prior Tax Court decision, the reversal only would have had effect for taxpayers in the Seventh Circuit had the Tax Court not reversed its prior position.

IRC §7502(a)(1) provides the general timely mailing is timely filing rule most practitioners are aware of.  If a document is postmarked by the United States Postal Service prior to final date for the action in question (in this case, filing of a Tax Court petition), it is deemed delivered on the date it is mailed.  If the document with “postmarks not made by the United States Postal Service” the presumption only applies “if and to the extent provided by regulations prescribed by the Secretary.”[1]

The IRS has provided such regulations at Reg. §301.7502-1(c)(1)(iii)(B).  The general rule for such documents provides:

(1) In general. If the postmark on the envelope is made other than by the U.S. Postal Service -

(i) The postmark so made must bear a legible date on or before the last date, or the last day of the period, prescribed for filing the document or making the payment; and

(ii) The document or payment must be received by the agency, officer, or office with which it is required to be filed not later than the time when a document or payment contained in an envelope that is properly addressed, mailed, and sent by the same class of mail would ordinarily be received if it were postmarked at the same point of origin by the U.S. Postal Service on the last date, or the last day of the period, prescribed for filing the document or making the payment.

If the document is not received by the time it would ordinarily have arrived at it destination, the regulation goes on to open a second possible way to show timely filing with a postmark not applied by the USPS:

(2) Document or payment received late. If a document or payment described in paragraph (c)(1)(iii)(B)(1) is received after the time when a document or payment so mailed and so postmarked by the U.S. Postal Service would ordinarily be received, the document or payment is treated as having been received at the time when a document or payment so mailed and so postmarked would ordinarily be received if the person who is required to file the document or make the payment establishes -

(i) That it was actually deposited in the U.S. mail before the last collection of mail from the place of deposit that was postmarked (except for the metered mail) by the U.S. Postal Service on or before the last date, or the last day of the period, prescribed for filing the document or making the payment;

(ii) That the delay in receiving the document or payment was due to a delay in the transmission of the U.S. mail; and

(iii) The cause of the delay.

As the opinion notes, the facts of this case are virtually identical to those in the original Seventh Circuit case (Tilden v. Commissioner, 846 F.3d 882 (7th Cir. 2017), rev'g and remanding T.C. Memo. 2015-188), with the law firm and the administrative assistant being the same in both cases.  However, the new case would be appealable to the Eight Circuit rather than the Seventh.

The facts are described as follows:

The Court received the petition on Wednesday, April 29, 2015, and filed it that same day. The petition was sent to the Court via certified mail delivery provided by the U.S. Postal Service (USPS). The envelope in which the petition was mailed bore a 20-digit USPS certified mail tracking number. The envelope did not have a USPS postmark, but it did have a “postmark” from, an online postage services provider. enables ordinary consumers to “enjoy the convenience of a traditional postage meter.” Tilden v. Commissioner, 846 F.3d at 885.

Petitioners have supplied a declaration under penalty of perjury from Katelynn Marshall, an administrative assistant at the law firm representing them. She avers that on April 21, 2015, she created through a postage label with official U.S. postage of $7.82 (the cost of ordinary postage plus the supplement for certified delivery). That label shows the Court's correct address, the certified mail tracking number referenced above, and the date “04/21/2015,” reflecting the date on which the label was created.

Ms. Marshall further avers that she affixed this label to an envelope containing the petition and sealed that envelope. According to her declaration, she personally carried the sealed envelope later that day to the U.S. Post Office at 2350 Arbor Lane, Salt Lake City, Utah 84117, and deposited it in the U.S. mail.

Ms. Marshall attached to her declaration a USPS “certified mail receipt” bearing the tracking number referenced above. Written by hand on that receipt are petitioners' names, the words “United States Tax Court” (in the block captioned “Send To”), and the date “4/21/15” (in the block captioned “Postmark Here”). Ms. Marshall avers that she made these notations when she mailed the envelope.

The USPS maintains an online tracking system that enables customers to track the progress of certified mail. The earliest entry in that system for the item bearing the certified mail number referenced above shows its arrival at a Salt Lake City USPS facility, with ZIP Code 84199, at 5:39 p.m. on April 23, 2015. (That is a different USPS facility from the one at which Ms. Marshall mailed the petition; the latter has ZIP Code 84117.) Subsequent entries in the USPS tracking system show that the item left the USPS facility with ZIP Code 84199 at 6:57 p.m. on April 23, 2015, and was delivered to this Court at 11:02 a.m. on April 29, 2015. As noted previously, the Court filed the petition an hour later that day.

The last date for filing the petition was April 22, 2015.  In the Tilden case the Tax Court noted the USPS tracking system showed the document at a Postal Service facility on April 23.  In a prior case (Boultbee v. Commissioner, TC Memo 2011-11) the Tax Court had found that such a tracking date was the functional equivalent of a USPS Postmark, using that as evidence the document in question had been timely filed.

But in this case (and in Tilden) the first date in the USPS tracking system was the date after the final date for filing.  If that entry was the equivalent of a USPS applied postmark under the regulations it would take precedence over any postmark applied by a party other the United States Postal Service.[2]  In Tilden the Court, finding that was a USPS applied postmark based on the Boulthee rationale, determined the Court lacked jurisdiction since the date was after the last date for filing the petition.

The Seventh Circuit, reviewing the above rationale in the Tilden case, decided that the Tax Court had erred in treating that first entry in the USPS system as a postmark and giving it precedence over the date.  Rather, the rules for a postmark applied by a party other than USPS should apply and, based on the facts in the Tilden case, the petition was timely filed.

The majority of the Court in Pearson decided to adopt the Seventh Circuit’s analysis, and thus held that since the facts were the same as Tilden, the Court had jurisdiction to hear this case.  Judge Buch in a concurring opinion that ten other Tax Court judges agreed with expanded on the Tax Court’s holding, noting that there are many methods for applying a postmark beyond the methods available when this provision was added to the law and that all those methods (beyond the postmark applied by the USPS itself) should be granted the same treatment as postage meters and labels.

One concern that arises from this holding is whether the Court would still hold the same as it did before if a case arose where there was no postmark on the envelope, but the USPS tracking systems showed the document in their systems before the filing date.  Boultbee had found that was a USPS postmark, but this case would seem to contradict that view.

[1] IRC §7502(b)

[2] Reg. §301.7502-1(c)(1)(iii)(B)(3)