                          T.C. Memo. 2003-98



                      UNITED STATES TAX COURT



 ESTATE OF ISABELLE N. GREENWOOD, DECEASED, DONNA NORQUIST AND
CHRISTINE N. STAMEY, INDEPENDENT CO-EXECUTRIXES, Petitioners v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 12214-02.                 Filed April 9, 2003.


     Edward D. Urquhart, John W. Porter, and Stephanie Loomis-

Price, for petitioners.

     Lillian D. Brigman, for respondent.



                          MEMORANDUM OPINION


     MARVEL, Judge:   This case is before the Court on the

estate’s motion to dismiss for lack of jurisdiction filed
                               - 2 -

pursuant to Rule 40.1   Respondent determined a Federal estate tax

deficiency of $2,532,269 with respect to the Estate of Isabelle

N. Greenwood (the estate).   The estate contends that respondent

did not mail a notice of estate tax deficiency to the estate or,

if respondent did mail the notice, the notice was not mailed to

the estate’s last known address and was, therefore, invalid.

                             Background

     Isabelle Greenwood (the decedent) resided in Houston, Texas,

when she died on August 25, 1998.   The coexecutrixes of

decedent’s estate, Donna Norquist (Ms. Norquist) and Christine N.

Stamey (Mrs. Stamey),2 resided in Santa Fe, New Mexico, and

Houston, Texas, respectively, on the date the petition was filed

in this case.

     On September 24, 1998, the estate mailed to respondent a

Form 56, Notice Concerning Fiduciary Relationship, designating

Ms. Norquist and Mrs. Stamey as coexecutrixes and 2115 Wroxton

Road, Houston, Texas 77005 (the Wroxton Road address), as the

fiduciary address.

     On May 25, 1999, the estate timely filed Form 706, United



     1
      All section references are to the Internal Revenue Code in
effect on the date of decedent’s death, and all Rule references
are to the Tax Court Rules of Practice and Procedure.
     2
      Ms. Norquist and Mrs. Stamey are the decedent’s daughters.
                                - 3 -

States Estate Tax Return, naming as coexecutrixes Ms. Norquist at

962 Stage Road, Aspen, Colorado 81611 (the Aspen address), and

Mrs. Stamey at the Wroxton Road address.   The estate attached to

the estate tax return a Form 2848, Power of Attorney, dated

May 25, 1999, which also provided the Aspen address for Ms.

Norquist3 and the Wroxton Road address for Mrs. Stamey.   The

power of attorney directed that respondent send all original

notices or communications to Anne Hardiman (Ms. Hardiman), the

attorney who prepared the estate tax return.

     The estate filed Form 1041, United States Income Tax Return

for Estates and Trusts, for each of the taxable years 1998 and

1999.    Both the 1998 return, filed on or about January 27, 2000,

and the 1999 return, filed on or about January 22, 2001, listed

the Wroxton Road address as the address for the estate, Ms.

Norquist, and Mrs. Stamey.

     On November 19, 2001, the estate mailed to respondent a new

Form 2848 that revoked the prior power of attorney, directed that

the estate receive all original notices and communications, and

listed the Wroxton Road address as the mailing address for the

estate, Ms. Norquist, and Mrs. Stamey.   The power of attorney

also required that respondent send a copy of all notices and

communications to the estate’s attorney, Edward D. Urquhart (Mr.


     3
      On Jan. 24, 2000, Ms. Norquist filed a form with the U.S.
Postal Service to change her address from the Aspen address to
1438-B Bishop’s Lodge Road, Santa Fe, New Mexico 87501. Ms.
Norquist and her husband, James Walter Dickson, used this new
address on their 1999 and 2000 joint income tax returns.
                                - 4 -

Urquhart).

     On May 8, 2002, respondent mailed by certified mail a notice

of estate tax deficiency (the notice) in an envelope addressed to

the estate and Ms. Norquist at the Aspen address.    The record is

not clear as to what became of the notice sent to the Aspen

address.4    On its face, the notice was also addressed to Mrs.

Stamey at the Wroxton Road address, but respondent did not mail a

copy to Mrs. Stamey.

     Additionally, on May 8, 2002, respondent mailed copies of

the notice to Ms. Hardiman and Mr. Urquhart.    Both Ms. Hardiman

and Mr. Urquhart received their copies.

     The estate filed a timely petition with this Court on July

24, 2002.    On the same day, the estate filed a motion to dismiss

for lack of jurisdiction to which respondent objected on

September 19, 2002.    The Court held a hearing on the motion to

dismiss at the Court’s trial session in Houston, Texas, on

October 22, 2002.    Counsel for the estate and respondent appeared

at the hearing and presented their positions on the motion to

dismiss.

                             Discussion

     The estate argues that we lack jurisdiction.    The two



     4
      The estate claims that it did not receive the notice of
deficiency from respondent. Respondent acknowledges that he did
not remail the notice to the estate at the Wroxton Road address
or at any other address.
                               - 5 -

requirements for our jurisdiction in a deficiency case are a

valid notice of deficiency issued by the Commissioner and a

timely petition filed by the taxpayer.   Frieling v. Commissioner,

81 T.C. 42, 46 (1983).   Because the estate timely filed its

petition in this case, the only jurisdictional issue for our

consideration is the validity of the notice of deficiency.

     If the Commissioner determines that there is a deficiency in

estate tax, he is authorized to send notice of such deficiency

“to the taxpayer by certified mail or registered mail.”   Sec.

6212(a); see also Abeles v. Commissioner, 91 T.C. 1019, 1026

(1988).5   Section 6212(b) authorizes the Commissioner to use

certain addresses in mailing the notice of deficiency.    Section

6212(b)(3), which deals solely with the estate tax, provides

that, in the absence of a notice concerning fiduciary

relationship filed under section 6903, a notice of estate tax

deficiency addressed and mailed to the decedent at the decedent’s

last known address is sufficient for purposes of chapter 11

(dealing with the estate tax) and chapter 63 (dealing with

assessment).



     5
      The mailing of a notice under sec. 6212(a) suspends the
running of the 3-year limitations period for assessments (the
limitations period) and triggers the taxpayer’s right to petition
this Court for redetermination of the deficiency. Secs. 6213(a),
6503(a)(1); see also St. Joseph Lease Capital Corp. v.
Commissioner, 235 F.3d 886, 888-889 (4th Cir. 2000) (holding that
in order to suspend the limitations period, the mailing need
comply only with section 6212(a)), affg. T.C. Memo. 1996-256.
                              - 6 -

     In this case, the coexecutrixes of decedent’s estate filed a

notice of fiduciary relationship pursuant to section 6903.

Section 6903 provides:

          Upon notice to the Secretary that any person is
     acting for another person in a fiduciary capacity, such
     fiduciary shall assume the powers, rights, duties, and
     privileges of such other person in respect of a tax
     imposed by this title (except as otherwise specifically
     provided and except that the tax shall be collected
     from the estate of such other person), until notice is
     given that the fiduciary capacity has terminated.

Once a notice of fiduciary relationship is filed, the fiduciary

steps into the shoes of the decedent, and any notice to which the

decedent might otherwise be entitled will be sufficient if

furnished to the decedent’s fiduciary, unless and until notice is

given that the fiduciary relationship has been terminated.   Sec.

6903; see also sec. 301.6903-1, Proced. & Admin. Regs.

     There is no dispute in this case that, in a Form 56 mailed

to respondent on September 24, 1998, the estate timely notified

respondent pursuant to section 6903 that the estate fiduciaries’

address of record was the Wroxton Road address.   There is also no

dispute that, although the notice of estate tax deficiency bore

the Aspen address and the Wroxton Road address, respondent

inexplicably did not mail the notice to the Wroxton Road address.

Instead, respondent mailed the original notice of estate tax

deficiency to the former residential address (the Aspen address)

of one of the fiduciaries and to the attorneys for the estate
                                 - 7 -

named in the May 25, 1999, and November 19, 2001, powers of

attorney (Forms 2848).

      Based on the above uncontested facts, the estate contends

that respondent failed to mail the notice of deficiency to the

taxpayer in order to satisfy section 6212 and that, therefore,

the notice of deficiency is invalid, depriving this Court of

jurisdiction over this matter.    The estate also contends that

based on two opinions of the United States Court of Appeals for

the Fifth Circuit, which the estate asserts are controlling,

respondent’s failure to mail the notice to the taxpayer’s last

known address invalidated the notice.    We address the estate’s

arguments below.

A.   The Fiduciaries’ Address

      Upon filing the notice concerning fiduciary relationship,

Ms. Norquist and Mrs. Stamey assumed the rights and duties of the

decedent for estate tax purposes.    Sec. 6903(a); Estate of

McElroy v. Commissioner, 82 T.C. 509, 512 (1984).    The notice

identified the fiduciaries’ address as the Wroxton Road address.

Reddock v. Commissioner, 72 T.C. 21, 24 (1979).    Respondent

concedes that the Wroxton Road address was the estate’s last

known address and that he did not mail the notice to that

address.

B.   Validity of the Notice

      The Wroxton Road address appeared on the face of the notice,
                                - 8 -

printed next to the Aspen address,6 but respondent concedes that

he did not mail the notice to the Wroxton Road address.

Respondent mailed the notice only to one coexecutrix, Ms.

Norquist, at the Aspen address.    According to the estate,

respondent’s failure to mail the notice to the Wroxton Road

address constituted “a fundamental failure to comply with Section

6212(a).”

     Respondent contends that his mailing, while flawed, was

sufficient on the facts involved here to comply with section

6212(a).    Respondent argues that section 6212(a) requires a

mailing to the estate which either was sent to the estate’s last

known address or, if sent to an incorrect address, was actually

received by the estate in sufficient time to meet the deadline

for filing a petition in this Court.    Respondent contends that

the latter requirement was satisfied because the estate actually

filed a petition with this Court prior to the expiration of the

filing period.    We agree with respondent.

     The purpose of the mailing under section 6212 is to provide

the taxpayer with notice and an opportunity to petition the Court

to challenge the Commissioner’s determination of a deficiency.

Frieling v. Commissioner, 81 T.C. at 53; Reddock v. Commissioner,

supra at 25; Lifter v. Commissioner, 59 T.C. 818, 820 (1973);


     6
      Respondent’s use of the Aspen address for Ms. Norquist and
the Wroxton Road address for Mrs. Stamey reflected the
fiduciaries’ addresses as they appeared on the estate tax return.
                                 - 9 -

Estate of Citrino v. Commissioner, T.C. Memo. 1987-565.     At the

hearing, the estate conceded that it had received actual notice7

of the estate tax deficiency but emphasized that respondent did

not provide it.   The estate’s position is that a notice of

deficiency is not valid for purposes of section 6212(a) unless

respondent provides it to the estate directly.    As support, the

estate cites Keeton v. Commissioner, 74 T.C. 377, 385 (1980), and

Houghton v. Commissioner, 48 T.C. 656, 661 (1967), cases in which

we concluded that a power of attorney directing respondent to

mail copies of notices of deficiency to the attorney does not

permit the substitution of the attorney’s address for the

taxpayer’s last known address.     Keeton v. Commissioner, supra,

and Houghton v. Commissioner, supra at 666, are distinguishable,

however, because the taxpayer in each of those cases did not have

actual notice of the deficiencies and did not file timely

petitions.

     When a taxpayer receives actual notice of a deficiency and

does not suffer prejudicial delay in filing a timely petition

with this Court, the notice of deficiency, even though

incorrectly addressed, is valid under section 6212(a).     St.

Joseph Lease Capital Corp. v. Commissioner, 235 F.3d 886, 891-892


     7
      The record is not clear as to how the estate learned of the
notice of deficiency. One of the estate’s attorneys may have
informed the estate of the notice, or the notice that was mailed
to the Aspen address may have been forwarded by the U.S. Postal
Service to Ms. Norquist.
                                - 10 -

(4th Cir. 2000), affg. T.C. Memo. 1996-256; Estate of Biskis v.

Commissioner, T.C. Memo. 2001-94; Estate of Citrino v.

Commissioner, supra.   Even if the Commissioner mails the notice

of deficiency to a third party and not directly to the taxpayers

as section 6212(a) requires, the notice of deficiency is still a

valid notice under section 6212 as long as the taxpayer receives

actual notice of the proposed deficiency and files a timely

petition to contest it.   See St. Joseph Lease Capital Corp. v.

Commissioner, supra (holding as valid a notice of deficiency not

mailed to the taxpayer’s last known address but faxed to the

taxpayer’s attorney and challenged by a timely petition); Lifter

v. Commissioner, supra at 822-823 (holding as valid a notice of

deficiency not mailed to the taxpayers’ last known address, but

received by the taxpayers’ attorney and challenged by a timely

petition); Brookshire v. Commissioner, T.C. Memo. 1990-258;

Estate of Citrino v. Commissioner, supra (holding as valid a

notice of deficiency not mailed to the fiduciary’s last known

address, but somehow obtained by the taxpayer or his attorney in

time to file a timely petition).

     The estate falls squarely within the aforementioned holdings

because the estate received actual notice of the deficiency

without prejudicial delay and filed a timely petition contesting

the deficiency in this Court.    However, the estate contends that

we are required by our opinion in Golsen v. Commissioner, 54 T.C.
                              - 11 -

742, 757 (1970), affd. 445 F.2d 985 (10th Cir. 1971), to follow

the opinions of the United States Court of Appeals for the Fifth

Circuit in Ward v. Commissioner, 907 F.2d 517 (5th Cir. 1990),

revg. 92 T.C. 949 (1989), and Mulder v. Commissioner, 855 F.2d

208 (5th Cir. 1988), revg. T.C. Memo. 1987-363.    According to the

estate, the Court of Appeals for the Fifth Circuit held in Ward

and Mulder that notices of deficiency mailed to an address other

than the taxpayer’s last known address were invalid.    Respondent

disagrees.   Respondent contends that Ward and Mulder are

distinguishable from this case and that, therefore, we are not

obligated to treat the opinions as precedent under Golsen.    We

agree.

     In Golsen v. Commissioner, supra at 757, we held that we

must “follow a Court of Appeals decision which is squarely in

point where appeal from our decision lies to that Court of

Appeals and to that court alone.”    We shall assume arguendo for

purposes of this analysis, that an appeal from our decision in

this case would lie in the Court of Appeals for the Fifth

Circuit.   See sec. 7482(b)(1).   We shall focus our analysis on

whether the opinions of the Court of Appeals in Ward and Mulder

are “squarely in point”.   A comparison of the undisputed facts in

this case with the facts found by the Court of Appeals in Ward

and Mulder confirms that the cases are distinguishable.
                                 - 12 -

     In Ward v. Commissioner, supra, the taxpayer sent to the

Commissioner a letter containing the taxpayer’s new address.       Id.

at 518.    During the period for processing the address change, the

Commissioner prepared a notice of deficiency with the taxpayer’s

old address as it appeared in the Commissioner’s computer.        Id.

at 519.    The taxpayer did not receive the notice of deficiency

and knew nothing of the deficiency until after the 90-day period

for petitioning this Court had expired.     Id.   The Court of

Appeals for the Fifth Circuit concluded that the Commissioner did

not exercise reasonable diligence in ascertaining the taxpayer’s

last known address.    Id. at 522.   The Commissioner’s agent should

have noticed that the taxpayer’s computer file displayed the

letters “PN” (pending notice) and a posting code, signifying a

pending address change.    Id.   The Court of Appeals held that the

notice of deficiency was invalid, noting that, under section

6212(a):    ”To be effective, a notice of deficiency must be mailed

to the taxpayer at his ‘last known address’.”      Id. at 521.

     In Mulder v. Commissioner, supra, the taxpayer relocated and

did not notify the Commissioner of the change in his address.

Id. at 209.   In an effort to secure an extension of the

applicable period of limitations on assessment from the taxpayer,

the Commissioner mailed to the taxpayer’s old address, but

received back as undeliverable, two extension requests.     The

Commissioner also mailed the notice of deficiency by certified
                                  - 13 -

mail to the same address.     Id. at 209-210.    The taxpayer did not

receive the notice of deficiency and did not learn of the

deficiency until the 90-day period for petitioning this Court had

expired.   Id. at 210.    As in Ward v. Commissioner, supra, the

Court of Appeals for the Fifth Circuit concluded that the

Commissioner had failed to exercise reasonable diligence in

obtaining the taxpayer’s last known address.       Mulder v.

Commissioner, supra at 212.       According to the Court of Appeals,

the returned, undeliverable extension requests should have put

the Commissioner on notice that the taxpayer’s address in the

computer was incorrect.     Id.    The Court of Appeals again held

that the notice of deficiency was invalid under section 6212.

Id. at 210-211.

     The opinions in Ward and Mulder do not compel a conclusion

that the notice of deficiency in this case was invalid because

the cases involved materially different facts and are

distinguishable from this case.      The taxpayers in Ward and Mulder

did not receive actual notice of the deficiency and clearly

experienced prejudicial delay in filing a timely petition to

challenge the deficiency.    In contrast, the estate received

actual notice of the deficiency and filed a timely petition in

this Court.8


     8
      The Court of Appeals for the Fifth Circuit has not decided
a last known address case in which the taxpayers had actual
                                                   (continued...)
                              - 14 -

     The opinions in Ward and Mulder are not controlling, and no

other Fifth Circuit case requires that we adopt the estate’s

position.   Consistent with existing precedent, therefore, we hold

that respondent’s concession that he failed to send the notice of

deficiency to the estate’s last known address did not invalidate

the notice of deficiency in this case because respondent timely

mailed the notice of deficiency under section 6212(a), the estate

received actual notice of the determination of deficiency without

prejudicial delay, and the estate filed a timely petition to

contest the proposed deficiency.   See Mulvania v. Commissioner,

81 T.C. 65, 68 (1983); see also Clodfelter v. Commissioner, 527

F.2d 754, 757 (9th Cir. 1975), affg. 57 T.C. 102 (1971); St.

Joseph Lease Capital Corp. v. Commissioner, T.C. Memo. 1996-256.

     We have considered the remaining arguments of both parties

for a result different from that reached herein and, to the



     8
      (...continued)
notice of the deficiency and filed a timely petition. However,
the Court of Appeals for the Fifth Circuit in Johnson v.
Commissioner, 611 F.2d 1015, 1018 (5th Cir. 1980), revg. T.C.
Memo. 1977-382, acknowledged in dicta that, while a valid notice
of deficiency ordinarily must be mailed to a taxpayer’s last
known address, an exception may apply in “the case where a
taxpayer has actually received the notice in some other manner.”
The Court of Appeals for the Fifth Circuit noted that mailing a
copy to the taxpayer’s attorney “would likely * * * [give the]
taxpayer notice of the asserted deficiency and thus an
opportunity to timely file a petition for redetermination.” Id.
at 1019-1020 n.7. The predicted result actually occurred in this
case where the estate’s attorney received a copy of the notice of
deficiency, apparently shared it with the estate, and the estate
filed a timely petition.
                             - 15 -

extent not discussed above, find those arguments to be

irrelevant, moot, or without merit.

     To reflect the foregoing,

                                           An appropriate order will

                                      be issued.
