                        T.C. Memo. 1998-438



                      UNITED STATES TAX COURT



                   RONALD THOMAS, Petitioner v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent


     Docket No. 3595-98.                 Filed December 15, 1998.


     Joseph L. Gibson, Jr., for petitioner.

     Stuart Spielman and Helen F. Rogers, for respondent.



                        MEMORANDUM OPINION

     DAWSON, Judge:   This case was assigned to Chief Special

Trial Judge Peter J. Panuthos pursuant to the provisions of

section 7443A(b)(4) and Rules 180, 181, and 183.1   The Court

agrees with and adopts the opinion of the Special Trial Judge,

which is set forth below.

     1
        All section references are to the Internal Revenue Code
as amended. All Rule references are to the Tax Court Rules of
Practice and Procedure.
                               - 2 -


                OPINION OF THE SPECIAL TRIAL JUDGE

     PANUTHOS, Chief Special Trial Judge:   This matter is before

the Court on respondent's Motion to Dismiss for Lack of

Jurisdiction on the ground that the petition was not filed within

the 90-day filing period prescribed under section 6213(a).   As

discussed in greater detail below, we will grant respondent's

motion.

                            Background

     Ronald Thomas (petitioner) was president of Delafield

Associates, Inc. (Delafield), a company that operated a

McDonald's restaurant in Baltimore, Maryland.   In February 1981,

Delafield filed a chapter 11 bankruptcy petition.    The Internal

Revenue Service subsequently became involved in the Delafield

bankruptcy case insofar as Delafield purportedly had failed to

pay Federal employment taxes for 1980 and 1981.

     In August 1981, petitioner and his then spouse, Shirley

Thomas (collectively the Thomases), filed joint Federal income

tax returns for the taxable years 1978, 1979, and 1980 listing

their address as 5404 Lightning View Rd., Columbia, Maryland (the

Lightning View address).

     In early 1983, respondent mailed to the Thomases an

examination report proposing adjustments to their tax liability

for 1978.   Shortly thereafter, the Thomases filed a joint

petition with the Court, assigned docket No. 24783-83, seeking a
                               - 3 -


redetermination of their tax liability for 1978.    At the time,

the Thomases continued to reside together at the Lightning View

address.   On November 30, 1983, the Court dismissed the Thomases'

petition on the ground that respondent had not issued a notice of

deficiency to the Thomases for 1978.

     During the fall of 1983, petitioner and Shirley Thomas were

experiencing marital difficulties and decided to separate.    To

reduce the impact on his children, petitioner left the Lightning

View address.   By December 1983, petitioner had moved into an

apartment at 4016½, North Rogers Avenue, Baltimore, Maryland

21207 (the Rogers Avenue address).

     On December 30, 1983, the Chief of the Collection Branch

assigned to the Internal Revenue Service Center in Philadelphia,

Pennsylvania, sent a Form 4901, Request for Information About Tax

Form, to petitioner at the Rogers Avenue address stating that

respondent had no record of receiving his 1982 tax return.    The

record does not clearly reflect how the Collection Branch became

aware of petitioner's Rogers Avenue address.

     On January 30, 1984, the Internal Revenue Service District

Director in Baltimore, Maryland, mailed a joint notice of

deficiency to the Thomases determining a deficiency of $36,401.86

in their Federal income tax for 1978 and an addition to tax under

section 6651(a) in the amount of $9,592.40.    The notice, which

was mailed by certified mail to the Lightning View address, was
                                - 4 -


returned to respondent marked "Unclaimed".    Shirley Thomas was

residing at the Lightning View address throughout the period in

question.   The record indicates that the notice of deficiency was

mailed to the Lightning View address on the basis of information

contained in the Thomases' administrative file and that

respondent did not conduct a computer search for petitioner's

address before mailing the notice of deficiency.    The record does

not reflect whether respondent made any further efforts to

deliver the notice of deficiency to the Thomases immediately

after the original notice was returned undelivered.2

     Between 1982 and 1984, the Thomases were contacted by

various revenue officers concerning the collection of Delafield's

unpaid Federal employment taxes and the possible imposition of

the 100-percent penalty against the Thomases with respect to

those taxes.   Sec. 6672.   Revenue Officer James Land met

petitioner during a field visit to Delafield's McDonald's

restaurant in Baltimore.3   In July 1982, Revenue Officer Grace

Jaecksch prepared a Form 4180, Report of Interview Held With

Persons Relative to Recommendation of 100-Percent Penalty

Assessments, based upon an interview with Shirley Thomas.      On

April 19, 1984, Revenue Officer Carla Mims-Dixon met with Mrs.


     2
        The Commissioner destroyed the Thomases' administrative
file in the normal course of business.
     3
         The record does not reflect the date of this visit.
                               - 5 -


Thomas during a field visit at the Lightning View address.   The

aforementioned revenue officers have no recollection of being

informed that petitioner was residing at the Rogers Avenue

address or that petitioner wanted correspondence to be mailed to

that address.

     Petitioner was provided with a copy of the notice of

deficiency for 1978 by letter from Revenue Officer Jaecksch dated

November 10, 1988.

     On February 24, 1998 (more than 14 years after the mailing

of the notice of deficiency and more than 9 years after

petitioner received a copy of the notice of deficiency),

petitioner filed a petition for redetermination with the Court.

The petition was hand-delivered to the Court.

     As indicated, respondent filed a Motion to Dismiss for Lack

of Jurisdiction on the ground that the petition was not timely

filed.   Petitioner filed an objection to respondent's motion

asserting that the notice of deficiency was not mailed to his

last known address.

     This matter was called for hearing on two occasions at the

Court's motions sessions held in Washington, D.C.   Counsel for

both parties appeared and presented evidence.   Following the

evidentiary hearing, both parties filed memoranda with the Court

setting forth their respective positions.
                               - 6 -


                            Discussion

     The Court's jurisdiction to redetermine a deficiency depends

upon the issuance of a valid notice of deficiency and the filing

of a timely petition.   Rule 13(a), (c); Monge v. Commissioner, 93

T.C. 22, 27 (1989); Normac, Inc. v. Commissioner, 90 T.C. 142,

147 (1988).   Section 6212(a) expressly authorizes the

Commissioner, after determining a deficiency, to send a notice of

deficiency to the taxpayer by certified or registered mail.     It

is sufficient for jurisdictional purposes if the Commissioner

mails the notice of deficiency to the taxpayer's "last known

address".   Sec. 6212(b); Frieling v. Commissioner, 81 T.C. 42, 52

(1983).   If a notice of deficiency is mailed to the taxpayer at

the taxpayer's last known address, actual receipt of the notice

is immaterial.   King v. Commissioner, 857 F.2d 676, 679 (9th Cir.

1988), affg. 88 T.C. 1042 (1987); Yusko v. Commissioner, 89 T.C.

806, 810 (1987); Frieling v. Commissioner, supra at 52.   The

taxpayer, in turn, generally has 90 days from the date the notice

of deficiency is mailed to file a petition with the Court for a

redetermination of the deficiency.     Sec. 6213(a).

     There is no dispute in this case that the petition was not

filed within the 90-day period prescribed in section 6213(a).

Although respondent mailed the notice of deficiency in question

on January 30, 1984, the petition was not filed until February

24, 1998.   Under the circumstances, it is evident that the Court
                                - 7 -


lacks jurisdiction in this case.   Nonetheless, we must decide

whether dismissal of this case should be premised on petitioner's

failure to file a timely petition under section 6213(a) or on

respondent's failure to issue a valid notice of deficiency under

section 6212.    See Pietanza v. Commissioner, 92 T.C. 729, 735-736

(1989), affd. without published opinion 935 F.2d 1282 (3d Cir.

1991).   In this regard, we must determine whether respondent

mailed the notice of deficiency in question to petitioner's last

known address.

     Although the phrase "last known address" is not defined in

the Internal Revenue Code or in the regulations, we have held

that a taxpayer's last known address normally is the address

shown on the taxpayer's most recently filed return, absent clear

and concise notice of a change of address.    Abeles v.

Commissioner, 91 T.C. 1019, 1035 (1988); see King v.

Commissioner, supra at 681.   Oral notification of a change of

address, clearly proved, may be sufficient to constitute a change

of address.   See Mollet v. Commissioner, 82 T.C. 618, 625-626

(1984), affd. without published opinion 757 F.2d 286 (11th Cir.

1985); Westphal v. Commissioner, T.C. Memo. 1992-599.

     The record in this case shows that respondent mailed the

notice of deficiency to the address appearing on petitioner's

1978, 1979, and 1980 tax returns--petitioner's most recently

filed tax returns before the mailing of the notice of deficiency.
                                - 8 -


Further, the notice of deficiency was returned to respondent

marked "Unclaimed" (as opposed to "Addressee Unknown",

"Insufficient Address" or "Unable to Forward"), indicating that

certified mail notices were left at the Lightning View address,

yet the notice of deficiency was not claimed.    See, e.g., Erhard

v. Commissioner, T.C. Memo. 1994-344, affd. 87 F.3d 273 (9th Cir.

1996).

     Petitioner contends that he provided oral notice to

respondent's revenue officers in the fall of 1983 that he had

changed his address to the Rogers Avenue address.    However, the

revenue officers who were in contact with the Thomases during

this period could not recall being informed of, or ever visiting,

the Rogers Avenue address.    The record does show that

respondent's Collection Branch in Philadelphia was aware that

petitioner might be contacted at the Rogers Avenue address--the

Collection Branch used that address in mailing the Form 4901 to

petitioner on December 30, 1983.    The revenue officers from the

Collection Branch in Philadelphia were not involved with the

examination of petitioner's individual income tax liability for

1978.    They were concerned with efforts to collect Delafield's

unpaid Federal employment taxes for 1980 and 1981 and/or the

imposition of the 100-percent responsible person penalty against

the Thomases with respect to those taxes, whereas the deficiency

notice for Federal income tax for 1978 was issued by the District
                                - 9 -


Director in Baltimore.   Cf. Westphal v. Commissioner, supra (oral

notice to examining agent was effective to constitute a change of

address).

     Petitioner further contends that respondent did not exercise

due diligence in determining his correct address.   It is well

settled that, where the Commissioner is aware, before issuing a

notice of deficiency, that the address he intends to use is no

longer the taxpayer's correct address, the Commissioner is

required to exercise reasonable diligence in attempting to

ascertain the taxpayer's correct address.   See King v.

Commissioner, supra at 681 n.8; Crawford v. Commissioner, T.C.

Memo. 1996-460; Stroud v. Commissioner, T.C. Memo. 1992-666.

     There is no evidence in the record that respondent was

aware, either before or immediately after the mailing of the

notice of deficiency, that the Lightning View address was not

petitioner's correct address.   Because of the passage of time, we

do not have the benefit of reviewing the contents of respondent's

administrative file.   However, on the basis of a review of the

record herein, we are satisfied that respondent was not put on

notice that petitioner was no longer residing at the Lightning

View address.   Moreover, the notice was returned to respondent

marked "Unclaimed" as opposed to "Addressee Unknown",

"Insufficient Address" or "Unable to Forward".   Under the

circumstances, respondent was justified in believing that the
                              - 10 -


notice of deficiency was addressed to the Thomases at their

correct address and that they simply failed to claim the notice

of deficiency.

     In sum, we conclude that respondent mailed the notice of

deficiency to petitioner's last known address.     Moreover, in

Powell v. Commissioner, 958 F.2d 53, 57 (4th Cir. 1992), the

Court of Appeals for the Fourth Circuit, the court to which an

appeal in this case would lie, held that "When notice of a

deficiency is not sent to a taxpayer's last known address,

subsequent actual notice of the deficiency will commence the

running of the ninety-day period."     In the instant case,

petitioner actually received the notice of deficiency in November

1988, yet waited over 9 years to file his petition with this

Court.   Accordingly, we will grant respondent's Motion to Dismiss

for Lack of Jurisdiction.4

     To reflect the foregoing,

                                          An order will be entered

                                 granting respondent's Motion to

                                 Dismiss for Lack of Jurisdiction.



     4
        Although petitioner cannot pursue his case in this Court,
he is not without a remedy. In short, petitioner may pay the
tax, file a claim for refund with the Internal Revenue Service,
and if the claim is denied, sue for a refund in the Federal
District Court or the U.S. Court of Federal Claims. See
McCormick v. Commissioner, 55 T.C. 138, 142 (1970).
