                                                 JOHN C. HOM & ASSOCIATES, INC., PETITIONER v.
                                                     COMMISSIONER OF INTERNAL REVENUE,
                                                                RESPONDENT
                                                        Docket No. 14081–11.                           Filed May 7, 2013.

                                                 R moved to dismiss the proceeding for lack of jurisdiction
                                               because petitioner’s corporate powers were suspended at the
                                               time the petition was filed. Petitioner contends that the notice
                                               of deficiency is invalid for failing to include the address and
                                               telephone number of the local office of the National Taxpayer
                                               Advocate and that inclusion of a Web page link is inadequate
                                               compliance with I.R.C. sec. 6212. Held: The notice was not
                                               invalid. The motion to dismiss will be granted.


                                      210




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                                      (210)         JOHN C. HOM & ASSOCS., INC. v. COMMISSIONER                                   211


                                           John C. Hom (an officer), for petitioner.
                                           Sarah E. Sexton, for respondent.

                                                                                  OPINION

                                        COHEN, Judge: This case is before the Court on respond-
                                      ent’s motion to dismiss for lack of jurisdiction. The issues for
                                      decision are whether the notice of deficiency was invalid for
                                      failing to include the address and telephone number of the
                                      local office of the National Taxpayer Advocate, as directed by
                                      section 6212(a), and whether the case should be dismissed for
                                      lack of jurisdiction because petitioner’s corporate status was
                                      suspended at the time the petition was filed. All section ref-
                                      erences are to the Internal Revenue Code, and all Rule ref-
                                      erences are to the Tax Court Rules of Practice and Proce-
                                      dure.

                                                                               Background
                                         Petitioner was incorporated in California on April 2, 1986.
                                      The California Franchise Tax Board suspended the powers,
                                      rights, and privileges of petitioner on March 1, 2004. The
                                      suspension remained in effect until April 13, 2012.
                                         In a notice of deficiency sent March 16, 2011, respondent
                                      determined deficiencies, additions to tax, and penalties as
                                      follows:

                                                                                            Penalty               Addition to tax
                                             Year              Deficiency                 sec. 6662(a)            sec. 6654(a)(1)
                                             2005                  $38,520                  $7,704.00                 $9,630.00
                                             2006                   47,072                   9,414.40                 11,768.00
                                             2007                   27,354                   5,470.00                  6,838.50
                                             2008                   27,886                   5,577.20                  6,971.50
                                             2009                   28,251                   5,650.20                  7,104.75

                                      The notice of deficiency included the following paragraph:
                                              The contact person can access your tax information and help you get
                                           answers. You also have the right to contact the office of the Taxpayer
                                           Advocate. Taxpayer Advocate assistance is not a substitute for estab-
                                           lished IRS procedures such as the formal appeals process. The Taxpayer
                                           Advocate is not able to reverse legally correct tax determinations, nor
                                           extend the time fixed by law that you have to file a petition in the U.S.
                                           Tax Court. The Taxpayer Advocate can, however, see that a tax matter
                                           that may not have been resolved through normal channels gets prompt
                                           and proper handling. If you want Taxpayer Advocate assistance, please




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                                      212                 140 UNITED STATES TAX COURT REPORTS                                    (210)


                                           contact the Taxpayer Advocate for the IRS office that issued this notice
                                           of deficiency. Please visit our website at www.irs.gov/advocate/content/
                                           0,,id=150972,00.html for the Taxpayer Advocate telephone numbers and
                                           addresses for this location.

                                         The petition was filed June 13, 2011. After the case was
                                      set for trial, respondent filed a motion to dismiss for lack of
                                      jurisdiction pointing out suspension of petitioner’s corporate
                                      privileges as of the time the petition was filed. Petitioner
                                      first objected to the motion on the ground that the suspen-
                                      sion had ended. When the motion was heard, however, peti-
                                      tioner argued that the notice of deficiency was invalid for
                                      failure to comply with the provision of section 6212(a) that
                                      a notice of deficiency ‘‘shall include a notice to the taxpayer
                                      of the taxpayer’s right to contact a local office of the taxpayer
                                      advocate and the location and phone number of the appro-
                                      priate office.’’

                                                                                Discussion
                                         Prerequisites to the deficiency jurisdiction of this Court are
                                      a valid notice of deficiency and a timely petition. Rule 13(a),
                                      (c); see, e.g., Monge v. Commissioner, 93 T.C. 22, 27 (1989);
                                      Abeles v. Commissioner, 91 T.C. 1019, 1025 (1988). If either
                                      a valid notice or a timely petition is lacking, the petition will
                                      be dismissed for lack of jurisdiction. The ground for lack of
                                      jurisdiction is generally stated, however, because the con-
                                      sequences of our holding the Commissioner may proceed to
                                      assess the taxes that have been determined would be that
                                      the taxpayer may challenge the determination on the merits
                                      only by making payment, filing a claim for refund, and
                                      seeking a judicial remedy in a refund forum. See, e.g.,
                                      DeWelles v. United States, 378 F.2d 37, 39 (9th Cir. 1967);
                                      Pietanza v. Commissioner, 92 T.C. 729, 735–736 (1989), aff ’d
                                      without published opinion, 935 F.2d 1282 (3d Cir. 1991);
                                      McKay v. Commissioner, 89 T.C. 1063, 1067 (1987), aff ’d, 886
                                      F.2d 1237 (9th Cir. 1989); Keeton v. Commissioner, 74 T.C.
                                      377, 379 (1980).
                                      Validity of the Notice of Deficiency
                                         Petitioner contends that the statutory notice of deficiency
                                      is invalid because the inclusion of a Web site address where
                                      the address and telephone number of the local office of the




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                                      (210)         JOHN C. HOM & ASSOCS., INC. v. COMMISSIONER                                   213


                                      National Taxpayer Advocate may be found does not comply
                                      with the applicable statute. The language petitioner relies on
                                      is the last sentence of section 6212(a) and was added by the
                                      Internal Revenue Service Restructuring and Reform Act of
                                      1998 (RRA 98), Pub. L. No. 105–206, sec. 1102(b), 112 Stat.
                                      at 698. That section now appears as follows:
                                           SEC. 6212. NOTICE OF DEFICIENCY.

                                              (a) In General.—If the Secretary determines that there is a deficiency
                                           in respect of any tax imposed by subtitle A or B or chapter 41, 42, 43,
                                           or 44, he is authorized to send notice of such deficiency to the taxpayer
                                           by certified mail or registered mail. Such notice shall include a notice
                                           to the taxpayer of the taxpayer’s right to contact a local office of the tax-
                                           payer advocate and the location and phone number of the appropriate
                                           office.

                                         Although the adequacy of the content of a notice of defi-
                                      ciency has frequently been litigated, courts have held repeat-
                                      edly that a notice of deficiency is valid if it notifies the tax-
                                      payer that a deficiency has been determined and gives the
                                      taxpayer the opportunity to petition this Court for redeter-
                                      mination of the proposed deficiency. See Frieling v. Commis-
                                      sioner, 81 T.C. 42, 53 (1983); Perlmutter v. Commissioner, 44
                                      T.C. 382 (1965), aff ’d, 373 F.2d 45 (10th Cir. 1967). A notice
                                      is invalid for this purpose only where the notice discloses on
                                      its face that there has been no determination. See Clapp v.
                                      Commissioner, 875 F.2d 1396, 1400 (9th Cir. 1989) (distin-
                                      guishing Scar v. Commissioner, 814 F.2d 1363 (9th Cir.
                                      1987), rev’g 81 T.C. 855 (1983)). Mistakes in a notice will not
                                      invalidate it if there is no prejudice to the taxpayer. Elings
                                      v. Commissioner, 324 F.3d 1110 (9th Cir. 2003).
                                         In Smith v. Commissioner, 114 T.C. 489, 491 (2000), aff ’d,
                                      275 F.3d 912 (10th Cir. 2001), we addressed whether the
                                      failure to include in the notice the date a petition was due
                                      invalidated the notice. The requirement to include the last
                                      day to file the petition was also added by RRA 98 sec. 3463,
                                      112 Stat. at 767, and is stated as follows: ‘‘The Secretary of
                                      the Treasury or the Secretary’s delegate shall include on
                                      each notice of deficiency under section 6212 of the Internal
                                      Revenue Code of 1986 the date determined by such Secretary
                                      (or delegate) as the last day on which the taxpayer may file
                                      a petition with the Tax Court.’’




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                                      214                 140 UNITED STATES TAX COURT REPORTS                                    (210)


                                        Here, as in Smith, section 6212 does not specify that a
                                      notice sent without the specified information is invalid. As in
                                      Smith, there was no prejudice shown by petitioner. The
                                      information described in section 6212(a) was made available
                                      to the addressee of the notice, although in a manner that
                                      may not be sufficient for a taxpayer without access to a com-
                                      puter or knowledge of how to access a Web site. The notice,
                                      however, was not misleading, and petitioner was able to file,
                                      and did file, a timely petition.
                                        The Court of Appeals for the Ninth Circuit reached the
                                      same result in Elings v. Commissioner, 324 F.3d at 1112–
                                      1113, explaining:
                                           In other contexts, the Supreme Court and this court have held that,
                                           when Congress fails to specify a consequence for an agency’s failure to
                                           follow mandatory requirements, the failure does not render the agency’s
                                           action ineffectual.14 Obedient to this instruction, we conclude that the
                                           IRS’s failure to include the calculated date does not invalidate the notice.
                                             The minor and technical nature of the error and the lack of prejudice
                                           in this case further supports our conclusion. Non-prejudicial minor or
                                           technical errors in a notice do not invalidate the notice. Major errors,
                                           such as those that show the IRS failed to comply with the most funda-
                                           mental statutory mandate, can invalidate a notice. However, these
                                           errors are quite rare. The failure to include the calculated date, when
                                           notice was dated and instructed Elings that he had ninety days in which
                                           to file his petition, was a non-prejudicial minor or technical error. There-
                                           fore, the error did not invalidate the notice. [Additional fn. refs. omitted.]
                                             14See  United States v. James Daniel Good Real Prop., 510 U.S. 43, 63–
                                           65, 114 S.Ct. 492, 126 L.Ed.2nd 490 (1993); Brock v. Pierce County, 476
                                           U.S. 253, 258–62, 106 S.Ct. 1834, 90 L.Ed.2d 248 (1986) (holding, when
                                           addressing an agency’s mandatory duty to act within a certain time
                                           period, that ‘‘courts should not assume that Congress intended the
                                           agency to lose its power to act’’ for failure to follow even mandatory
                                           statutory requirements when Congress has not so stated); see also Inter-
                                           continental Travel Mktg., Inc. v. FDIC, 45 F.3d 1278, 1284–85 (9th Cir.
                                           1994) (concluding that FDIC’s failure to comply with mandatory statu-
                                           tory requirement of mailing a notice, when the failure was merely neg-
                                           ligent, did not justify precluding the agency from further action).

                                        The Court of Appeals for the Ninth Circuit specifically
                                      agreed with the analysis by the Court of Appeals for the
                                      Tenth Circuit in affirming Smith v. Commissioner, 275 F.3d
                                      912, and with the Court of Appeals for the Fifth Circuit
                                      reaching the same result in Rochelle v. Commissioner, 293
                                      F.3d 740 (5th Cir. 2002), aff ’g 116 T.C. 356, 362–363 (2001).




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                                      (210)         JOHN C. HOM & ASSOCS., INC. v. COMMISSIONER                                   215


                                         The rationale of Smith and Elings applies at least as much
                                      to this case. There was no prejudice to petitioner. Petitioner
                                      does not allege that any attempt to contact the local office of
                                      the National Taxpayer Advocate was made. Moreover, it is
                                      apparent from the record that petitioner’s officer and share-
                                      holder is adept at Internet research and could easily have
                                      accessed the Web site to locate the appropriate local office of
                                      the National Taxpayer Advocate. We conclude that the notice
                                      of deficiency was valid.
                                         We have considered the case petitioner cites, Marangi v.
                                      Gov’t of Guam, 319 F. Supp. 2d 1179 (D. Guam 2004). The
                                      notice in question, and held invalid there, did not include
                                      any reference to the taxpayer’s right to contact a local office
                                      of the National Taxpayer Advocate, and there was no such
                                      office in Guam at the time. Thus the taxpayer was prejudiced
                                      by the denial of a right described by the District Court as
                                      meaningful assistance and protection, significant and impor-
                                      tant. Id. at 1184. That case is distinguishable and, in any
                                      event, not precedential.
                                      Corporate Capacity To File Petition
                                         Rule 60(c) states in part: ‘‘The capacity of a corporation to
                                      engage in such litigation [in this Court] shall be determined
                                      by the law under which it was organized.’’ Petitioner’s cor-
                                      porate capacity was suspended at the time the petition was
                                      filed on June 13, 2011, and was not reinstated until April
                                      2012, shortly before trial. Under the same scenario, in David
                                      Dung Le, M.D., Inc. v. Commissioner, 114 T.C. 268 (2000),
                                      aff ’d, 22 Fed. Appx. 837 (9th Cir. 2001), interpreting Cali-
                                      fornia law, we concluded that the Court lacked jurisdiction.
                                      That case is controlling here. Respondent’s motion to dismiss
                                      for lack of jurisdiction will be granted.




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                                      216                 140 UNITED STATES TAX COURT REPORTS                                    (210)


                                           To reflect the foregoing,
                                                                      An appropriate order of dismissal for lack
                                                                   of jurisdiction will be entered.

                                                                               f




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