                             T.C. Memo. 1996-250



                           UNITED STATES TAX COURT



                    LEE R. STEVENS, Petitioner v.
            COMMISSIONER OF INTERNAL REVENUE, Respondent



       Docket No. 21524-93.                          Filed May 30, 1996.



       Lee R. Stevens, pro se.

       Charles M. Ruchelman, for respondent.



                 MEMORANDUM FINDINGS OF FACT AND OPINION


       JACOBS,     Judge:      Respondent     determined   the   following

deficiencies in, and additions to, petitioner’s Federal income

taxes:

                                            Additions to Tax
Year              Deficiency        Sec. 6651(a)       Sec. 6654(a)

1989             $10,251            $441.75                 ---
1990              10,204             603.50                $101.83
                                        -2-

      Respondent’s determinations were reflected in two notices of

deficiency, one for each of the years involved.                Respondent now

concedes the deficiencies and all additions to tax for both years

involved.

      Petitioner seeks refunds for claimed overpayments of his 1989

and 1990 Federal income taxes; respondent contends the refunds

sought are time-barred.         Accordingly, the issue for decision is

whether petitioner is entitled to refunds for claimed overpayments

of   his   1989   and   1990    Federal    income   taxes,    or   whether   the

statutorily imposed time limitations of sections 6511 and 6512

preclude him from obtaining any portion of his overpayments.

Resolution of this issue depends on whether petitioner               filed his

1989 and 1990 Federal income tax returns as of the date the notices

of deficiency were mailed.

      All section references are to the Internal Revenue Code in

effect for the years under consideration.           All Rule references are

to the Tax Court Rules of Practice and Procedure.

                               FINDINGS OF FACT

      Some   of   the   facts    have     been   stipulated   and   are   found

accordingly.      The stipulation of facts and the attached exhibits

are incorporated herein by this reference.

      At the time he filed his petition, Lee R. Stevens (petitioner)

resided in Falls Church, Virginia. Petitioner has a bachelor of

arts degree in political science, and two masters of arts degrees,

one in public administration and the other in marine affairs.
                                      -3-

During the years under consideration, petitioner was a program

manager    with    the    Joint   Oceanographic     Institutions,      Inc.,   in

Washington, D.C.

     In 1989, petitioner earned $49,544 in wages, $39 in taxable

interest income, and $722 in dividend income; he paid $8,484 in

withholding tax that year.         In 1990, petitioner earned $50,497 in

wages, $29 in taxable interest income, and $266 in dividend income;

he paid $7,790 in withholding tax that year. The withholding tax

payments constitute the sole payments received by respondent with

regard to petitioner’s 1989 and 1990 tax years.                 Petitioner has no

record that he filed his 1989 or 1990 tax returns. He did not send

the returns by certified or registered mail.              Petitioner did not

use a tax return preparer to prepare his 1989 or 1990 tax returns.

        The Internal Revenue Service’s (IRS) tax module indicates that

petitioner neither filed 1989 or 1990 tax returns nor claimed a

credit or refund for a 1989 or 1990 overpayment. The IRS sent

letters to      petitioner     requesting   that    he   file   1989   and   1990

returns.       Petitioner claims he never received any such letters.

The letters were not returned to the IRS as undeliverable.

     On March 29, 1993, the IRS (under the authority of section

6020(b)), constructed 1989 and 1990 returns for petitioner from

payor information documents. The notices of deficiency, which were

mailed to petitioner’s last known address on July 3, 1993, are

based     on   these     substitute   returns,     and   the    deficiency     tax
                                          -4-

computations are based upon the allowance of the standard deduction

and one personal exemption, as in effect for each year.

       Petitioner timely filed a petition in this Court on October 1,

1993; he filed an amended petition on December 6, 1993. The amended

petition not only contests the 1989 and 1990 deficiencies and

additions to tax, but contains a claim for tax refunds of $906 and

$571 for 1989 and 1990, respectively. Petitioner stated in the

amended petition that he is entitled to his itemized deductions.

On February 4, 1994, respondent filed an answer to the amended

petition, generally denying petitioner’s allegations.

       On or about February 25, 1994, petitioner mailed respondent

copies of his 1989 and 1990 Federal income tax returns, which

petitioner alleges were timely filed on April 15, 1990, and April

15, 1991, respectively. On March 15, 1994, respondent received

these documents. The returns reflect tax overpayments of $2,0962

and    $2,135       for   1989    and    1990,    respectively,    and   claimed

corresponding refunds.           Respondent accepted these returns as filed

on    March   15,    1994.       As   stated,    respondent   acknowledges   that

petitioner owes no tax deficiencies or additions to tax for 1989 or

1990, but contends that petitioner’s refund claims for such years

are time-barred.


       1
          The amended petition does not specify how these figures
were determined.
       2
          Petitioner claimed a $2,068 overpayment on the copy of
his 1989 Federal income tax return. After respondent discovered a
mathematical error, respondent corrected the 1989 return to
reflect a $2,096 overpayment.
                                         -5-

      Petitioner’s case was heard on November 1, 1994.             It was held

in suspense pending a decision by the Supreme Court regarding the

Fourth Circuit Court of Appeals' opinion in Lundy v. Commissioner,

45 F.3d 856 (4th Cir. 1995).3              The Supreme Court handed down a

decision in the Lundy case on January 17, 1996.               See Commissioner

v. Lundy, 516 U.S.           , 116 S. Ct. 647 (1996).

      Following     a    January   30,   1996,   conference    call   with   the

parties, we ordered that the record be “reopened for the limited

purpose of allowing petitioner to file a second amended petition on

or before February 29, 1996.”              On February 27, 1996, petitioner

filed a second amended petition, disputing the deficiencies and

additions to tax, requesting refunds for overpayments of $2,096 and

$2,135 for 1989 and 1990, respectively, and contending that his

1989 and 1990 returns were timely filed.                  Petitioner further

asserted that he had understood the notices to address solely                his

disallowed deductions rather than contesting the timely filing of

his returns as well.       On March 28, 1996, respondent filed an answer

to   petitioner’s       second   amended    petition,   denying   petitioner’s

allegations, and asserting that this Court lacks jurisdiction to

award petitioner’s requested refunds for 1989 and 1990.




      3
          An appeal of this case would be to the Fourth Circuit
Court of Appeals.
                                        -6-

                                    OPINION

Filing of Petitioner’s 1989 and 1990 Returns

      Preliminarily, we must decide when petitioner filed his 1989

and   1990    tax   returns.       Generally,      calendar   year     individual

taxpayers must file a Federal income tax return by April 15

following the close of the calendar year.                   Sec. 6072(a). “The

‘filing’ of a return or a claim for refund by a taxpayer is

completed when the return or claim reaches the collector’s office.”

Jones v. United States, 226 F.2d 24, 28 (9th Cir. 1955); see also

Heard v. Commissioner, 269 F.2d 911, 913 (3d Cir. 1959), revg. on

another issue 30 T.C. 1093 (1958); Walden v. Commissioner, 90 T.C.

947, 951 (1988); Pace Oil Co. v. Commissioner, 73 T.C. 249 (1979).

      Petitioner bears the burden of proving when he filed a return.

Rule 142(a). Petitioner has no documentary evidence as to when or

even that he did file his tax returns for 1989 and 1990.                  When a

taxpayer cannot provide any documentary evidence that he filed a

tax return and respondent’s records do not show receipt of the

document in question, we have accepted the credible testimony of

witnesses to the preparation and mailing of the document.                      See

Estate of Wood v. Commissioner, 92 T.C. 793, 796, 798 (1989), affd.

909 F.2d 1155 (8th Cir. 1990) (testimony of postmistress who

affixed      postmark);     Mitchell      Offset    Plate     Serv.,    Inc.   v.

Commissioner,       53    T.C.   235,     239-240    (1969)     (testimony     of

corporation’s       shareholders    and    its   accountants).         Petitioner

testified that he personally prepared his 1989 and 1990 returns.
                                      -7-

He further testified that he sent by regular mail his 1989 return

on   April   6,   1990,   and   his   1990    return   on   April   10,   1991.

Petitioner’s mother, Mary E. Stevens, testified that she reviewed

her son’s 1989 and 1990 returns prior to their proper filing dates,

witnessed her son sign the 1989 return, and accompanied him to the

post office when he mailed the 1989 return.            She did not accompany

petitioner when he mailed his 1990 return.

      Petitioner argues that because he timely deposited his 1989

and 1990 Federal income tax returns in the U.S. mail, in properly

addressed envelopes with the proper prepaid postage affixed, there

is a strong presumption that the returns were delivered to, and

received by, the IRS in due course.

      Respondent claims that petitioner’s 1989 and 1990 returns were

not filed before March 15, 1994.             In this regard, Kyle Outen, a

custodian of records with the IRS Philadelphia Service Center,

testified that a diligent search of the IRS’ files revealed no

record of petitioner's filing his 1989 or 1990 returns prior to

March 15, 1994.4

      Section 7502(a) provides that when a return is delivered by

U.S. mail to the IRS office to which such return is required to be

filed after the date prescribed for its filing, the date of the

U.S. postmark stamped on the envelope in which the return is mailed

is deemed to be the date the return is delivered to the IRS.


      4
          Although 1989 and 1990 are the only years before us,
Mr. Outen testified that the Internal Revenue Service has no
record of petitioner's filing returns for 1991 or 1993.
                                         -8-

Petitioner,     however,    cannot       avail    himself      of    this   remedial

provision because the record does not establish that the returns

were delivered to the IRS prior to March 15, 1994.                          See sec.

301.7502-1(d)(1), Proced. & Admin. Regs.

     Section 7502(c) provides that if a return is sent by U.S.

registered or certified mail, the registration or certification is

prima facie evidence that the return was delivered to the IRS

office to which it was addressed.                    See sec. 301.7502-1(d)(1),

Proced. & Admin. Regs.; see also Hiner v. Commissioner, T.C. Memo.

1993-608.     Petitioner did not mail his 1989 or 1990 returns by

registered or certified mail. Thus, he assumes the risk of non-

delivery of the returns.         See Walden v. Commissioner, supra at 952.

     It is difficult to believe that respondent could lose or

misplace petitioner’s tax returns for both of the years in issue,

as well as for 1991 and 1993.            Based on the record before us, we

are unable to find that petitioner filed his 1989 and 1990 returns

as of the date the notices of deficiency were mailed.

Overpayments of 1989 and 1990 Taxes

     Petitioner       contends    that    he    is    entitled      to   refunds   for

overpayments of his 1989 and 1990 Federal income taxes. Respondent

contends that the time limitations of sections 6511 and 6512

preclude petitioner from obtaining any portion of his overpayments.

     Pursuant    to    section    6512(b)(1),         we    have    jurisdiction   to

determine the existence and amount of any overpayment of tax to be

credited or     refunded    for    years       that   are    properly     before   us.
                               -9-

However, if a taxpayer has not filed a return before the notice of

deficiency was mailed, our jurisdiction with regard to claimed

refunds is limited to taxes paid during the 2-year period prior to

the date the deficiency notice was mailed.   See secs. 6511(b)(2)5

and 6512(b)(3)(B);6 Commissioner v. Lundy, 516 U.S.    ,       , 116


     5
          Sec. 6511(a) generally provides that a claim for credit
or refund of an overpayment of tax must be filed by the taxpayer
within 3 years from the time the return was filed or within 2
years from the time the tax was paid, whichever period expires
later. Sec. 6511(a) also expressly provides that, if no return
is filed, the claim must be filed within 2 years from the time
the tax was paid. Sec. 6511(b)(2) provides limitations on the
amount of any credit or refund, as follows:

     (2) Limit on amount of credit or refund.--

              (A) Limit where claim filed within 3-year period.--
     If the claim was filed by the taxpayer during the 3-year
     period prescribed in subsection (a), the amount of the
     credit or refund shall not exceed the portion of the tax
     paid within the period, immediately preceding the filing of
     the claim, equal to 3 years plus the period of any extension
     of time for filing the return. If the tax was required to
     be paid by means of a stamp, the amount of the credit or
     refund shall not exceed the portion of the tax paid within
     the 3 years immediately preceding the filing of the claim.

              (B) Limit where claim not filed within 3-year
     period.--If the claim was not filed within such 3-year
     period, the amount of the credit or refund shall not exceed
     the portion of the tax paid during the 2 years immediately
     preceding the filing of the claim.

              (C) Limit if no claim filed.--If no claim was
     filed, the credit or refund shall not exceed the amount
     which would be allowable under subparagraph (A) or (B), as
     the case may be, if claim was filed on the date the credit
     or refund is allowed.
     6
          Sec. 6512(b)(3) limits the amount of the credit or
refund as follows:

     (3) Limit on amount of credit or refund.--No such credit or
                                                   (continued...)
                                    -10-

S. Ct. 647, 652-653 (1996); Rossman v. Commissioner, 46 F.3d 1144

(9th Cir. 1995), affg. without published opinion T.C. Memo. 1993-

351; Richards v. Commissioner, 37 F.3d 587 (10th Cir. 1994), affg.

T.C. Memo. 1993-102; Allen v. Commissioner, 23 F.3d 406 (6th Cir.

1994), affg. without published opinion 99 T.C. 475 (1992); Davison

v.   Commissioner,    9   F.3d   1538   (2d   Cir.   1993),   affg.   without

published opinion T.C. Memo. 1992-709; Galuska v. Commissioner, 5

F.3d 195 (7th Cir. 1993), affg. 98 T.C. 661 (1992); Patronik-Holder



      6
       (...continued)
      refund shall be allowed or made of any portion of the tax
      unless the Tax Court determines as part of its decision that
      such portion was paid--

                  (A) After the mailing of the notice of deficiency,

                (B) Within the period which would be applicable
       under section 6511(b)(2), (c), or (d), if on the date of
       the mailing of the notice of deficiency a claim had been
       filed (whether or not filed) stating the grounds upon which
       the Tax Court finds that there is an overpayment, or

                   (C) Within the period which would be applicable
          under section 6511(b)(2), (c), or (d), in respect of any
          claim for refund filed within the applicable period
          specified in section 6511 and before the date of the
          mailing of the notice of deficiency--

                       (i) which had not been disallowed
                       before that date,

                       (ii) which had been disallowed before
                       that date and in respect of which a
                       timely suit for refund could have been
                       commenced as of that date, or

                       (iii) in respect of which a suit for
                       refund had been commenced before that
                       date and within the period specified in
                       section 6532.
                                            -11-

v.     Commissioner,          100    T.C.   374,        378-379   (1993);     Berry    v.

Commissioner, 97 T.C. 339, 344-345 (1991); Little v. Commissioner,

T.C. Memo. 1995-1; Khinda v. Commissioner, T.C. Memo. 1994-617;

Courtney         v.     Commissioner,       T.C.        Memo.   1994-502;     Floyd    v.

Commissioner, T.C. Memo. 1994-379; Phillips v. Commissioner, T.C.

Memo. 1993-349.

       The notices of deficiency concerning petitioner’s 1989 and

1990 tax years were mailed on July 3, 1993, and petitioner did not

file       his   1989    or   1990    returns      by    that   date.7   As   a   result,

petitioner’s claimed refunds are limited to the amount of 1989 and

1990 taxes he paid in the two years prior to the mailing of the

notices of deficiency.

       The only tax payments petitioner made for these years were the

withholding credits from his wages, which are deemed to have been

paid as of April 15, 1990, and April 15, 1991, for 1989 and 1990,

respectively. See sec. 6513(b)(1).8                 Because the withholding taxes

were paid more than two years before the notices of deficiency were

mailed, petitioner is not entitled to a refund of any part of the



       7
          Petitioner is deemed to have filed his refund claims on
July 3, 1993, the date the notices of deficiency were mailed.
Sec. 6512(b)(3)(B).
       8
                 Sec. 6513(b)(1) provides in pertinent part:

                     (1) Any tax actually deducted and withheld at the
                 source during any calendar year * * * shall * * * be
                 deemed to have been paid by him on the 15th day of the
                 fourth month following the close of his taxable year
                 with respect to which such tax is allowable as a credit
                 under section 31.
                                -12-

1989 or 1990 overpayments.   We therefore hold that the statutorily

imposed time limitations of sections 6511 and 6512 bar us from

determining that petitioner is entitled to refunds with respect to

his 1989 and 1990 income taxes.   See Commissioner v. Lundy, supra.

     To reflect the foregoing and respondent’s concessions,


                                       Decision will be entered for

                               petitioner as to the deficiencies

                               and     additions   to   tax   and   for

                               respondent as to the overpayments.
