                       T.C. Memo. 1998-210



                     UNITED STATES TAX COURT


                    HANNA & ASSOCIATES, P.C.,
             FORMERLY MARK J. HANNA, P.C., Petitioner v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent




     Docket No. 10734-97.               Filed June 16, 1998.



     Charles F. Daily, Jr., for petitioner.

     Steven B. Bass, for respondent.




                        MEMORANDUM OPINION


     PARR, Judge:   This case is before the Court on respondent's

motion to dismiss for lack of jurisdiction filed on June 30,

1997,1 pursuant to Rule 53.2   The issue for decision is whether

1
     On August 25, 1997, respondent filed an amendment to
                                                   (continued...)
                               - 2 -

petitioner lacks capacity under Rule 60(c) to invoke this Court's

jurisdiction.

Background

      Hanna & Associates, P.C., formerly Mark J. Hanna, P.C. was a

corporation organized under the laws of the State of Texas.   On

February 2, 1994, Mark J. Hanna, petitioner's sole shareholder,

adopted a resolution to dissolve the corporation.   On February

24, 1994, petitioner filed a certificate of dissolution with the

Texas secretary of state resulting in petitioner's dissolution

pursuant to Tex. Bus. Corp. Act Ann. art. 6.06 (West 1994).

     Petitioner's 1993 and 1994 Federal income tax returns were

filed on March 15, 1994, and September 18, 1995, respectively.

     On February 26, 1997, respondent issued a notice of

deficiency to petitioner determining deficiencies in and

penalties on petitioner's Federal income taxes as follows:

                                    Penalties
    Year        Deficiency         Sec. 6662(a)
    1993         $31,450             $6,290
    1994          13,474              2,695




1
 (...continued)
respondent's motion to dismiss for lack of jurisdiction,   arguing
on alternative grounds that petitioner lacks capacity to   invoke
this Court's jurisdiction. Since we find for respondent    based on
the original motion to dismiss, respondent's alternative   argument
raised in the amended motion is moot.
2
     All section references are to the Internal Revenue Code in
effect for the taxable years in issue, and all Rule references
are to the Tax Court Rules of Practice and Procedure, unless
otherwise indicated.
                                - 3 -

     On May 27, 1997, Charles F. Daily, Jr., as counsel for

petitioner, filed a petition with this Court in the name of

petitioner.

     On June 30, 1997, respondent filed a motion to dismiss for

lack of jurisdiction on the ground that, because petitioner was

dissolved more than 3 years prior to the filing of the petition

herein, under Texas State law petitioner now lacks capacity to

invoke this Court's jurisdiction.   On July 22, 1997, petitioner

filed an objection to respondent's motion to dismiss on the

ground that the notice of deficiency was invalid, because it was

issued more than 3 years after the deadline of the dissolution of

the corporation.

     Respondent's motion was calendared for hearing in San

Antonio, Texas.    Counsel for respondent appeared at the hearing

and presented arguments on the pending motion.   Petitioner's

attorney did not appear for the hearing, nor were any written

statements of petitioner's position filed with the Court as

provided for pursuant to Rule 50(c).

Discussion

     Rule 60(c) states that the capacity of a corporation to

engage in litigation in this Court shall be determined by the law

under which the corporation was organized.    Brannon's of Shawnee,

Inc. v. Commissioner, 71 T.C. 108, 111 (1978); Condo v.

Commissioner, 69 T.C. 149, 151 (1977); Great Falls Bonding

Agency, Inc. v. Commissioner, 63 T.C. 304, 305 (1974).    Because
                               - 4 -

petitioner was organized in the State of Texas, we look to the

law of that State to determine whether petitioner possesses the

requisite capacity to invoke this Court's jurisdiction.

     Petitioner's capacity to engage in litigation is prescribed

by Tex. Bus. Corp. Act Ann. art. 7.12 (West 1994), which provides

that a dissolved Texas corporation shall continue its corporate

existence for a period of 3 years from the date of the

dissolution, for the purpose of prosecuting or defending in its

corporate name any action or proceeding brought by or against it.

     In applying Tex. Bus. Corp. Act Ann. art. 7.12 ( West 1994)

to the facts presented, we agree with respondent that the cause

of action underlying this proceeding was not commenced within 3

years of the date that petitioner was dissolved.   The record

shows that petitioner dissolved on February 24, 1994.    It is

clear that under Texas law petitioner's existence as extended by

statute terminated on February 24, 1997, i.e., 3 years after its

dissolution.   As of that date it ceased to exist and lacked

capacity to institute any legal proceeding.   Great Falls Bonding

Agency Inc., v. Commissioner, supra; Comfort Home Builders, Inc.

v. Commissioner, T.C. Memo. 1995-225.   Thus, a petition filed

with this Court in petitioner's name on May 27, 1997, more than 3

years after its dissolution, cannot be entertained.

     Moreover, we note that petitioner has not articulated a

sound argument in opposition to respondent's motion to dismiss

for lack of jurisdiction.   Rather, petitioner maintains that
                                 - 5 -

respondent should be precluded from issuing a deficiency notice

to a dissolved corporation.   As we observed in Great Falls

Bonding Agency, Inc. v. Commissioner, supra at 306:

          At first blush, it does seem anomalous that
     respondent would issue a statutory notice of deficiency
     to a taxpayer and then turn around and say that there
     is no taxpayer who can petition this Court for a
     redetermination of the determined deficiency--as * * *
     [respondent] has done here. Yet, section 6212(b)(1) is
     explicit in its language which permits respondent, in
     the absence of a notice of fiduciary relationship, to
     send a notice of deficiency to a corporation which has
     terminated its existence--as has the petitioner.

     There being no indication that petitioner provided

respondent with a notice of a fiduciary relationship under

sections 6903 and 6212(b)(1), respondent was justified in issuing

the disputed deficiency notice directly to petitioner

notwithstanding its dissolution.

     Accordingly, we grant respondent's motion to dismiss for

lack of jurisdiction on the ground that petitioner lacked

capacity under Rule 60(c) to invoke this Court's jurisdiction.

     To reflect the foregoing,



                                              An appropriate order

                                         of dismissal for lack

                                         of jurisdiction will

                                         be entered.
