                           T.C. Memo. 1998-24



                      UNITED STATES TAX COURT



     NEAL A. SANDERS, d.b.a. LAW OFFICES OF NEAL A. SANDERS,
   Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 128-97.                          Filed January 21, 1998.



     Neal Alan Sanders, pro se.

     Peter J. Gavagan, for respondent.


                           MEMORANDUM OPINION


     JACOBS, Judge:    This matter is before the Court on the

parties'   cross-motions    to   dismiss   for   lack   of   jurisdiction.

Respondent moves to dismiss this case as to income tax deficiencies

for 1992 and 1993 for lack of jurisdiction on the grounds that the

amended petition (in which the allegations concerning those income

tax deficiencies were first raised) was filed more than 90 days
                                  - 2 -


after the notice of deficiency was issued, and to strike all

references thereto from the amended petition.        Petitioner requests

the Court    to   dismiss   respondent's   claim   for   1992   income   tax

deficiencies and for section 4975 excise tax deficiencies for years

before 1993 on the grounds that petitioner did not receive notices

of deficiency with respect to the determined deficiencies for these

taxes until after the limitations period.1               In this respect,

petitioner avers that the two notices of deficiency (one relating

to excise tax deficiencies pursuant to section 4975 for 1992-95 and

the other relating to income tax deficiencies for 1992 and 1993)

were not mailed to him at his correct address.           To resolve these

competing procedural disputes, we must determine whether respondent

mailed the notices of deficiency to petitioner at petitioner's last

known address.

     All section references are to the Internal Revenue Code as in

effect for the years in issue, and all Rule references are to the

Tax Court Rules of Practice and Procedure.

Background

     Respondent issued three notices of deficiency, each dated

October 11, 1996.    The first notice determined Federal excise tax

deficiencies pursuant to section 4971 and additions to tax pursuant


     1
          In response to petitioner's motion, respondent filed a
supplement to respondent's original motion requesting the Court
to extend the scope of respondent's motion to dismiss to include
the sec. 4975 excise taxes for years 1992-95.
                                   - 3 -


to section 6651 for 1991-95 with respect to asserted accumulated

funding deficiencies for the law offices of Neal A. Sanders' money

purchase pension and profit sharing plans (the first deficiency

notice), as follows:

                                                              Addition to Tax
Year    Sec. 4971(a) Deficiency   Sec. 4971(b) Deficiency       Sec. 6651(a)

1991             $772                         ---                     $193
1992            1,310                     $12,604                      327
1993            3,250                      31,999                      812
1994            3,042                      53,624                      ---
1995            5,362                      53,624                      804

The    second   notice   determined    Federal      excise   tax    deficiencies

pursuant to section 4975 and additions to tax pursuant to section

6651 for 1992-95 (the second deficiency notice) with respect to an

asserted prohibited transaction (the borrowing of money) engaged in

by the law offices of Neal A. Sanders with both its money purchase

pension and profit sharing plans, as follows:

                                                                   Addition to Tax
Year    Sec. 4975(a) Deficiency    Sec. 4975(b) Deficiency          Sec. 6651(a)(1)

1992               $87                       ---                       $22
1993               294                       ---                        74
1994               518                       ---                       130
1995               775                     $17,087                     116

The third notice determined Federal income tax deficiencies and

accuracy-related penalties pursuant to section 6662 for 1992 and

1993 (the third deficiency notice) with regard to Neal Alan and

Linda Sanders, husband and wife, as follows:

                                                     Accuracy-Related Penalty
            Year             Deficiency                     Sec. 6662(a)

            1992             $22,927                         $4,585
            1993              18,478                          3,696
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     The first deficiency notice was addressed to the law offices

of Neal Sanders at "106 S. Main St., Ste. 808, Butler, PA      16001".

The second deficiency notice was addressed to Neal Sanders at "118

Hickory Hills,   Slippery   Rock,   PA   16057"   (the   Hickory   Hills

address), and the third deficiency notice was addressed to Neal

Alan and Linda Sanders at the Hickory Hills address.

     On January 2, 1997, Neal A. Sanders, d.b.a. Law Offices of

Neal A. Sanders (petitioner), filed a petition in this Court2 in

which he contested respondent's determinations relating to "excise

taxes and penalties in an accumulated amount in excess of $10,000

* * * for the years 1991, 1992, 1993, 1994 and 1995."      Attached to

the petition were copies of the first deficiency notice only.

     The 90-day period for filing a petition with respect to each

of the three notices of deficiency expired on January 9, 1997,

which was not a Saturday, Sunday, or legal holiday in the District

of Columbia.

     On June 5, 1997, petitioner filed an amended petition in which

he disputed the income tax deficiencies determined against Neal

     2
          The petition was captioned "Neal A. Sanders, d.b.a. Law
Offices of Neal A. Sanders, Law Offices of Neal A. Sanders
Pension Plan, and Law Offices of Neal A. Sanders Profit Sharing
Plan, by Plan Administrator, Neal A. Sanders." On Feb. 27, 1997,
respondent filed a Motion to Dismiss for Lack of Jurisdiction as
to Law Offices of Neal A. Sanders Pension Plan and Law Offices of
Neal A. Sanders Profit Sharing Plan and to Change Caption. On
July 7, 1997, we granted respondent's motion and ordered the
caption of this case changed to read "Neal A. Sanders, d.b.a. Law
Offices of Neal A. Sanders, Petitioner v. Commissioner of
Internal Revenue, Respondent."
                                   - 5 -


Alan and Linda Sanders, as set forth in the third deficiency

notice, as well as the deficiencies set forth in the first and

second    deficiency   notices.      The   amended   petition   states   in

pertinent part:

                 The deficiencies (or liabilities) as
                 determined by the Commissioners [sic] are
                 in excise taxes and penalties in an
                 accumulated    amount   in   excess    of
                 $10,000.00 and are all in dispute by the
                 Petitioners as set forth herein for years
                 1991, 1992, 1993, 1994, and 1995. This
                 includes Form 1040, 1992, Form 1040, 1993
                 and Sections 4975 and 4971.

     On July 31, 1997, respondent filed a motion to dismiss for

lack of jurisdiction with respect to that part of the amended

petition relating to Neal Alan and Linda Sanders' 1992 and 1993

income tax deficiencies.          Respondent asserts that because the

January 2, 1997, petition contained no reference to respondent's

income tax determinations, petitioner is attempting, through the

filing of the amended petition, to seek a judicial redetermination

of a matter that could not come within the Court's jurisdiction

because of the expiration of time for filing a petition.         See Rule

41(a).    Accordingly, respondent contends that the amended petition

should be dismissed for lack of jurisdiction insofar as it attempts

to confer jurisdiction on the Court over Neal Alan and Linda

Sanders' 1992 and 1993 income taxes.

     On    August   22,   1997,   petitioner   filed   an   objection    to

respondent's motion to dismiss; on October 2, 1997, petitioner
                               - 6 -


filed amended objections.   In these documents, petitioner contends

that his petition was timely filed:

          as to all Notices of Deficiency allegedly
          issued by IRS [Internal Revenue Service] in
          October, 1996 including F1040 1992, 1993 and
          Section 4975 because of the language Petitioner
          uses in said Petition and because the
          Respondent    had   sufficient    Notice   that
          Petitioner was contesting all Notices of
          Deficiency whether or not said Notices were
          attached to the Petition.

In addition, petitioner asserts that respondent's motion to dismiss

should be denied on the ground that the second and third deficiency

notices were not sent to petitioner's last known address.   In this

regard, petitioner maintains that he was informed of the second and

third deficiency notices only when he received (on August 1, 1997)

respondent's motion to dismiss.

     On September 22, 1997, the Court held a hearing on respondent's

motion to dismiss.

     On October 20, 1997, petitioner filed a "Motion to Dismiss--

(F1040 1992 Income Taxes) (Section 4975 Excise Taxes Pre 1993)".

In this motion, petitioner contends that the mailing address used

by respondent to contact him should not have been the Hickory Hills

address with respect to the second and third deficiency notices.

Consequently, petitioner continues, the second and third deficiency

notices were improperly mailed and the period of limitations for

making a deficiency assessment expired with respect to his and his

wife's 1992 income tax liability as well as his liability for
                                          - 7 -


section 4975 excise taxes for years before 1993.                      In arguing that

respondent used an erroneous mailing address, petitioner claims

that:      (1) His rural box number, R.D. #1, Box 108-2 (R.D. #1), was

replaced with a house number and street address (the Hickory Hills

address)      in    order      to   accommodate    implementation       of    an   E-911

Emergency Notification System; (2) this mailing address modification

did not officially occur until after December 31, 1996; and (3) the

first time petitioner used the Hickory Hills address was on his 1996

return, which the IRS did not receive until August 15, 1997.

        On   January      5,    1998,    respondent      filed   an     objection     to

petitioner's motion to dismiss.                   In this objection, respondent

maintains that petitioner used the Hickory Hills address as his

address in dealings with respondent's representatives before the

issuance of the notices at issue herein. In this regard, respondent

states that on August 15, 1995, petitioner and his spouse filed a

joint 1994 Federal income tax return, listing 118 Hickory Hills as

their current address.               (The 1994 return was the last return

petitioner filed before October 11, 1996, the date on which the

notices      were    mailed.)        Moreover,     respondent    asserts      that    the

envelope petitioner used to mail his 1994 return lists 118 Hickory

Hills as petitioner's return address.

        Respondent further states that on September 21, 1995, the chief

of   the     IRS'    Philadelphia        Error    Resolution     Section      wrote   to

petitioner         and   his    spouse    using    the   Hickory      Hills   address.
                                  - 8 -


Respondent states: (1) In that letter petitioner was asked to

complete and return Form 4684, Casualties and Thefts, with regard

to petitioner's 1994 return; (2) on October 16, 1995, petitioner

returned a completed Form 4684 to respondent and listed the Hickory

Hills address as his personal residence; and (3) the envelope

petitioner used to return Form 4684 to respondent bears the Hickory

Hills address.

     Finally, respondent disputes petitioner's position that the

modification of petitioner's address from R.D. #1 to 118 Hickory

Hills occurred after December 31, 1996.         Respondent claims that

according to the U.S. Postal Service that modification occurred

approximately in February 1993.       Continuing, respondent maintains

that the R.D. #1 and Hickory Hills addresses are one and the same,

and that mail sent in October 1996 to either address would have been

delivered to petitioner.     In sum, respondent claims that the second

and third deficiency notices were properly sent to petitioner's last

known address.

     On    January   5,   1998,   respondent   filed   a   supplement    to

respondent's motion to dismiss dated July 31, 1997.               In    the

supplement, respondent maintains that because petitioner claims (in

his motion to dismiss) that he did not receive the second and third

notices until August 1, 1997, then a fortiori the January 2, 1997,

petition could not relate to the determinations made in those

notices.   Accordingly, respondent requests the Court to dismiss for
                                   - 9 -


lack of jurisdiction petitioner's request for a redetermination of

the 1992 and 1993 income tax deficiencies as well as the 1992-95

section 4975 excise tax deficiencies.

Discussion

     The jurisdiction of this Court to redetermine a deficiency

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

timely filed petition.      Rule 13(a) and (c); Levitt v. Commissioner,

97 T.C. 437, 441 (1991); Monge v. Commissioner, 93 T.C. 22, 27

(1989); Normac, Inc. v. Commissioner, 90 T.C. 142, 147 (1988).              In

essence, petitioner contends that the second and third deficiency

notices   were   not    valid   because    they   were   issued   beyond   the

limitations period, and respondent contends that we do not have

jurisdiction to consider the second and third deficiency notices

because there was no indication that respondent's determinations set

forth therein were being contested in a timely filed petition (i.e.,

the January 2, 1997, petition).

     We shall first consider respondent's motion to dismiss for lack

of jurisdiction.       The Rules of this Court provide that

           Ordinarily, a separate petition shall be filed
           with respect to each notice of deficiency or
           each notice of liability. However, a single
           petition may be filed seeking a redetermination
           with respect to all notices of deficiency or
           liability directed to one person alone or to
           such person and one or more other persons or to
           a husband and a wife individually, except that
           the Court may require a severance and a
           separate case to be maintained with respect to
           one or more of such notices. Where the notice
           of deficiency or liability is directed to more
                                - 10 -


          than one person, each such person desiring to
          contest it shall file a petition, either
          separately or jointly with any such other
          person, and each such person must satisfy all
          the requirements of this Rule in order for the
          petition to be treated as filed by or for such
          person. The petition shall be complete, so as
          to enable ascertainment of the issues intended
          to be presented. * * * Failure of the petition
          to satisfy applicable requirements may be
          ground for dismissal of the case. * * *

Rule 34(a).

     Section 6213(a) provides that in general a petition must be

filed within 90 days after the notice of deficiency authorized under

section 6212(a) is mailed.    Our jurisdiction is narrowly defined by

statute, and we have no power to extend the 90-day period for filing

a petition.   Rule 25(c); see Pyo v. Commissioner, 83 T.C. 626, 632

(1984).   Here, the 90-day period for filing a timely petition

expired on January 9, 1997--a date that is before the date the

amended petition was filed.

     We agree with respondent that the original petition (that is,

the petition filed on January 2, 1997) did not indicate that

petitioner was contesting respondent's income tax determinations and

accuracy-related penalties for 1992 and 1993, as set forth in the

third deficiency notice.     There was no mention of income taxes in

that part of the petition informing us as to the nature of the case,

nor could we ascertain from the caption of the case that Mr. Sanders

intended to contest respondent's determination in any capacity other

than as it related to his law firm.      Other than a statement in the
                                      - 11 -


petition that "All tax forms or their equivalent have been timely

filed by Petitioner with the IRS (Form 5310, 5330, 5500, 1040)",

there is no indication that would enable us to ascertain that

petitioner intended to contest respondent's 1992 and 1993 income tax

determinations.      Thus, petitioner failed to file a timely petition

requesting a redetermination of these taxes, and consequently,

respondent's   motion    to    dismiss      and    request   to    strike   those

allegations in petitioner's amended petition concerning income tax

deficiencies   for    1992    and    1993   must   be   granted.      O'Neil   v.

Commissioner, 66 T.C. 105 (1976).

     The petition did not specifically refer to the section 4975

excise tax deficiencies.            However, there is an allegation in a

paragraph of the petition claiming error by respondent referring to

the "Plan loans/hardship withdrawals for employee/owners".                     We

believe it proper to give petitioner the benefit of the doubt and

to infer that petitioner intended to contest the section 4975 excise

tax deficiencies as well as the section 4971 excise tax deficiencies

in the petition.     Consequently, respondent's motion to dismiss and

request to strike those allegations in petitioner's amended petition

concerning the section 4975 excise taxes will be denied.

     We now turn our attention to petitioner's request to dismiss

respondent's claim for 1992 income tax deficiencies (as set forth

in the third notice of deficiency) and for section 4975 excise taxes

for years before 1993 (as set forth in the second notice of
                                       - 12 -


deficiency).      Petitioner        asserts     that    the    3-year        period    of

limitations on assessment and collection with respect to 1992 income

tax deficiencies (which are joint deficiencies) and for section 4975

excise   taxes    for       years    before    1993    had    expired.       Petitioner

characterizes this assertion as a jurisdictional issue.

     The statute of limitations is an affirmative defense and does

not affect the jurisdiction of this Court.                       Rule 39; Badger

Materials,   Inc.      v.    Commissioner,      40     T.C.   1061,     1063    (1963);

Sutherland   v.      Commissioner,      T.C.    Memo.    1996-1,       affd.    without

published opinion 111 F.3d 127 (3d Cir. 1997).                  Accordingly, were

we to agree with petitioner's argument (which we do not, as

explained infra), we would recharacterize petitioner's motion as a

motion for summary judgment and enter a decision of no deficiency

as to income tax and section 4975 excise taxes for 1992.

     Section 6212(a) authorizes the Commissioner to send a notice

of deficiency to a taxpayer by certified or registered mail.                          For

jurisdictional purposes, it is sufficient if the notice of deficiency

is mailed to the taxpayer's "last known address".                      Sec. 6212(b);

Frieling v. Commissioner, 81 T.C. 42, 52 (1983).                     If the notice is

mailed to the taxpayer's last known address, actual receipt of the

notice is not required.             Yusko v. Commissioner, 89 T.C. 806, 810

(1987); Frieling v. Commissioner, supra.                 Both the mailing of the

notice to a taxpayer's last known address and the time for filing

a petition are jurisdictional requirements, and if either is not

satisfied,     the    Court     must     dismiss       the    case     for     lack   of
                                  - 13 -


jurisdiction.3     Monge v. Commissioner, 93 T.C. 22 (1989); Yusko v.

Commissioner, supra at 807.

     The phrase "last known address" is not defined in the Internal

Revenue Code or the regulations.           However, we have held that a

taxpayer's last known address is the address shown on his most

recently filed return, absent clear and concise notice of a change

of address.      Abeles v. Commissioner, 91 T.C. 1019, 1035 (1988);

accord Aibejeris v. Commissioner, T.C. Memo. 1995-31.         We have also

held that "last known address" is the address where the Commissioner

reasonably believed the taxpayer wished to be reached.            Weinroth v.

Commissioner, 74 T.C. 430, 435 (1980); Keeton v. Commissioner, 74

T.C. 377, 381-382 (1980); Snow v. Commissioner, T.C. Memo. 1996-457.

     The taxpayer bears the burden of proving that the notice of

deficiency was not sent to the taxpayer's last known address. Yusko

v. Commissioner, supra at 808.          "Taxpayers are required to send a

clear    and   concise   notification    directing   respondent    to   use   a

different address to be assured of effecting a change in the 'last

known address.'     Alta Sierra Vista, Inc. v. Commissioner, 62 T.C.

367, 374-375 (1974), and cases collected therein."                 Looper v.

Commissioner, 73 T.C. 690, 696 (1980).         To supplant the address on

the most recent return, the taxpayer must clearly indicate that the



     3
          However, a notice of deficiency sent to the wrong
address is valid if it is received by the taxpayer without
prejudicial delay. Berger v. Commissioner, 404 F.2d 668 (3d Cir.
1968), affg. 48 T.C. 848 (1967); Goodman v. Commissioner, 71 T.C.
974 (1979).
                                - 14 -


former address is no longer to be used. Tadros v. Commissioner, 763

F.2d 89, 92 (2d Cir. 1985).

      Respondent has established through the submission of U.S.

Postal Service Form 3877 that the second and third deficiency

notices were mailed to petitioner on October 11, 1996. See Magazine

v. Commissioner, 89 T.C. 321, 324, 327 (1987).                   Moreover, we

conclude that the second and third deficiency notices were mailed

to the address shown on petitioner's most recently filed return;

hence, both deficiency notices were properly mailed to petitioner's

last known address.    See, e.g., Follum v. Commissioner, supra.            (As

an aside, we agree that respondent was not given clear and concise

notification of a change of address.)

     To   summarize,    those   parts    of    respondent's        motion    as

supplemented that seek to dismiss the 1992 and 1993 income tax

deficiencies and accuracy-related penalties will be granted, and

that part of respondent's motion as supplemented that seeks to

dismiss the section 4975 excise tax deficiencies will be denied.

Conversely,   petitioner's   motion     to   dismiss   as   to    income    tax

deficiencies for 1992 and as to section 4975 excise taxes before

1993 will be denied.

     To reflect the foregoing,


                                                   An appropriate order

                                              will be issued.
