                      T.C. Memo. 1997-376



                   UNITED STATES TAX COURT



                HANNA AND ASSOCIATES, P.C.,
         F.K.A. MARK J. HANNA, P.C., Petitioner v.
       COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 9716-96.           Filed August 18, 1997.




     Charles F. Daily, Jr., for petitioner.

     Steven B. Bass, for respondent.



                      MEMORANDUM OPINION

     WHALEN, Judge:   This case is before the Court to

decide respondent's Motion To Dismiss For Lack Of

Jurisdiction.   The issue for decision is whether petitioner

filed its petition within the time prescribed by section
                             - 2 -


6213(a).   Unless stated otherwise, all section references

are to the Internal Revenue Code.



                         Background

     Petitioner is a corporation.     At the time the instant

petition was filed, petitioner's principal place of

business was in Austin, Texas.

     Respondent issued a notice of deficiency determining a

deficiency of $19,131 in petitioner's 1992 income tax, and

an accuracy-related penalty pursuant to section 6662(a) of

$3,826.

     Respondent sent the notice of deficiency by certified

mail to petitioner's last known address on February 8,

1996.   The 90-day period under section 6213(a) for timely

filing a petition for redetermination in this Court expired

on May 8, 1996.

     After the notice of deficiency was mailed to

petitioner, its president, Mr. Mark J. Hanna, conferred

with its attorney, Charles F. Daily, Jr., about filing a

petition for redetermination with this Court and about the

substance of the petition.   Mr. Hanna was aware that the

deadline for filing such a petition was May 8, 1996, and

he met with Mr. Daily on May 7, 1996, to finalize the

preparation of a petition for redetermination.
                              - 3 -


     At that time, petitioner employed Ms. Denese D.

Lindsay-Mosley as a legal assistant and office manager.

Ms. Mosley had worked for petitioner in that capacity

for approximately 6½ years.    She was responsible for

petitioner's outgoing mail and was the only person in

petitioner's office who regularly used petitioner's private

postage meter.

     On May 7, 1996, Mr. Hanna instructed Ms. Mosley to

type and mail the instant petition.    Ms. Mosley was aware

that the petition needed to be filed on or before May 8,

1996.   Mr. Daily relied upon Ms. Mosley to type and mail

the instant petition because he did not employ his own

secretary.   After the close of business on May 7, 1996,

Ms. Mosley planned to be away from the office for

approximately 3 weeks to marry and go on a honeymoon.

During Ms. Mosley's absence from the office, from May 9,

1996, through May 24, 1996, petitioner employed a temporary

secretary, Ms. Laura Sanders.

     The instant petition was received by the Court, and

was filed, on May 20, 1996, 102 days after the mailing of

the notice of deficiency.   It was received in an envelope

postmarked "May 7, 1996" from Austin, Texas.    The postmark

was made by a private postage meter bearing the number

5048754, and not by the U.S. Postal Service.    The petition
                            - 4 -


is dated May 7, 1996, and is signed by petitioner's

attorney.   The envelope in which the petition was received

by the Court is not torn or damaged, and there are no

markings indicating that additional postage was due or that

the normal delivery of the envelope was delayed.    The

parties agree that the normal delivery time for a properly

addressed envelope sent from Austin, Texas, to Washington,

D.C., is 3 days.

     On May 7, 1996, the mailboxes in petitioner's building

were located in the basement.    Sometime thereafter, the

mailboxes were moved to a location down the hall from

petitioner's office.   While it is unclear from the record

exactly when that move occurred, it is clear that the move

had taken place by July 11, 1996, the date on which

petitioner filed Petitioner's Response To Respondent's

Motion To Dismiss, and the date of Ms. Mosley's affidavit

attached thereto (Ms. Mosley's affidavit).

     Over the years, petitioner has had several different

postal meters, and each meter has had a different serial

number.   On May 7, 1996, petitioner was using a postal

meter with the number 5048754.    Sometime after May 28,

1996, the date Ms. Mosley returned from her vacation, a

Pitney Bowes representative replaced petitioner's postal

meter with one bearing the number 5037718.
                                - 5 -


     On or about July 6, 1996, Mr. Hanna wrote the

following letter to Mr. Steve Hanson, the mailing requests

clerk at the main U.S. Post Office in Austin, Texas,

inquiring whether petitioner's office had ever been

notified about sending "'stale date' mailings":


     Dear Mr. Hanson:

          If you will check your Austin Post Office
     computer record of notices sent relating to
     "stale date" mailings and certify that neither
     Mark J. Hanna, P.C. nor Hanna & Associates, P.C.
     have ever been mailed such a notice, I would
     appreciate it. Our Pitney-Bowes meter number
     is 5037718.
                              Sincerely,


                                     Mark J. Hanna


In response, Mr. Hanson provided the following information:


     Post office personnel scan all metered mail which
     is collected in this fashion. Most such mail
     does not separately receive a postmark in our
     cancelling facility. However, when scanners
     detect metered mail which does not bear the
     current date on its meter, it is pulled and run
     through a cancelling machine to receive a cancel
     bearing the current date over its 'stale' meter
     date. If either a significant amount of stale
     date metered mail or any mail bearing a meter
     date several days old is detected, the sender may
     be contacted and asked to redate all such mail
     before it is remailed.

                    *   *   *    *    *   *   *

     Upon the written request of Mr. Mark J. Hanna,
     who has held a Pitney Bowes postage meter number
     5037718 and has sent mail labeled either Mark J.
                             - 6 -


     Hanna, P.C. or Hanna and Associates, P.C. since
     1990, I checked our computer and learned that no
     stale date notices have been recorded on that
     account.

                          Discussion

     The issue for decision is whether the instant petition

was filed with the Court within 90 days after the notice of

deficiency was mailed to petitioner, as required by section

6213(a).   The petition was received by the Court on May 20,

1996, 102 days after the mailing of the notice of

deficiency.    The envelope in which the petition was

received bears the postmark May 7, 1996, 89 days after the

notice of deficiency was mailed to petitioner.     The Court

must decide whether the petition shall be deemed to be

filed on the date of the postmark on the envelope, as

permitted in certain circumstances by section 7502.     The

postmark on the envelope was not made by the U.S. Postal

Service.   It was made by petitioner's private postage

meter.

     If section 7502 applies, a document that is timely

mailed is treated as timely filed.     In order for section

7502 to apply, the document must be mailed in accordance

with certain requirements set forth in the statute and

regulations.    See sec. 7502(a)(2), (b); sec. 301.7502-1(c),

Proced. & Admin. Regs.    For example, the document must be

contained in a properly addressed envelope, with sufficient
                            - 7 -


postage prepaid.   See sec. 301.7502-1(c)(1), Proced. &

Admin. Regs.   There are additional rules regarding the

postmark on the envelope.   Sec. 301.7502-1(c)(1)(iii).   In

the case of a postmark made other than by the U.S. Postal

Service, section 301.7502-1(c)(1)(iii)(b), Proced. & Admin.

Regs., sets forth the following rules:


     (b) If the postmark on the envelope or wrapper
     is made other than by the United States Post
     Office, (1) the postmark so made must bear a
     date on or before the last date, or the last
     day of the period, prescribed for filing the
     document, and (2) the document must be received
     by the agency, officer, or office with which it
     is required to be filed not later than the time
     when a document contained in an envelope or other
     appropriate wrapper which is properly addressed
     and mailed and sent by the same class of mail
     would ordinarily be received if it were post-
     marked at the same point of origin by the United
     States Post Office on the last date, or the last
     day of the period prescribed for filing the
     document. However, in case the document is
     received after the time when a document so
     mailed and so postmarked by the United States
     Post Office would ordinarily be received, such
     document will be treated as having been received
     at the time when a document so mailed and so
     postmarked would ordinarily be received, if the
     person who is required to file the document
     establishes (i) that it was actually deposited in
     the mail before the last collection of the mail
     from the place of deposit which was postmarked
     (except for the metered mail) by the United
     States Post Office on or before the last date,
     or the last day of the period, prescribed for
     filing the document, (ii) that the delay in
     receiving the document was due to a delay in the
     transmission of the mail, and (iii) the cause of
     such delay.
                              - 8 -


      As mentioned above, the instant petition was received

by the Court on May 20, 1996, 13 days after petitioner

alleges that it was mailed.    The parties agree that the

ordinary delivery time for a properly addressed envelope

sent from Austin, Texas, to Washington, D.C., is 3 days.

Accordingly, the petition was not received by the Court

within the ordinary delivery time for mail sent from

Austin, Texas, to Washington, D.C.    Therefore, under

section 301.7502-1(c)(1)(iii)(b), Proced. & Admin. Regs.,

quoted above, the petition will not be deemed filed on the

postmark date, May 7, 1996, unless petitioner establishes:

(1) That the petition was actually deposited in the mail

before the last collection of the mail on May 8, 1996,

the last day for filing the petition; (2) that the delay

in receiving the petition was due to a delay in the trans-

mission of the mail; and (3) the cause of the delay.     Sec.

301.7502-1(c)(1)(iii)(b), Proced. & Admin. Regs.; see

Gomez v. Commissioner, T.C. Memo. 1996-561; Little v.

Commissioner, T.C. Memo. 1995-491.

     We find that petitioner has failed to satisfy each

of the three conditions of section 301.7502-1(c)(1)(iii)

(b), Proced. & Admin. Regs.    Petitioner has introduced no

evidence to show that the delay in receiving the petition

was due to a delay in the transmission of the mail, the
                             - 9 -


second condition, or to show the cause of the delay, the

third condition.    See Beacham v. Commissioner, T.C. Memo.

1996-226; Gomez v. Commissioner, supra.    We note that the

complete failure of proof on petitioner's part in regard

to the delay in the transmission of the mail makes this

case readily distinguishable on its facts from Rotenberry

v. Commissioner, 847 F.2d 229 (5th Cir. 1988), revg. and

remanding an unreported order of this Court, where the

Commissioner conceded that the delay in delivering the

taxpayer's petition to the Tax Court was occasioned by a

delay in the transmission of the mail, and the Court of

Appeals accepted the taxpayer's explanation of the cause

of that delay.    At the hearing on respondent's motion,

petitioner's attorney conceded that petitioner did not have

proof regarding these conditions of the regulations.     The

following discussion took place at the hearing:


     THE COURT:    Let me just ask you a question,
                   Mr. Daily. In your opening are you
                   conceding that Petitioner cannot make
                   the proof called for in regulation
                   Section 301.7502-1(c)(iii)(b), in-
                   asmuch as you do not claim to have
                   proof to show that the delay in
                   receiving the document was due to
                   a delay in the transmission of the
                   mail?

                     And that the cause of -- and that
                   you have no proof to show the cause
                   of delay?
                             - 10 -


     MR. DAILY:     That's correct, Your Honor. And
                    therefore, I would argue that that
                    Section does not apply to us because
                    of the interpretation of what
                    postmark of the United States Post
                    Office is.


     Inasmuch as petitioner had no proof regarding

the second and third conditions of section 301.7502-

1(c)(iii)(b), Proced. & Admin. Regs., petitioner's attorney

argued "that the marking on our envelope should, in fact,

be considered a U.S. postmark because the U.S. Postal

Service so considers it and their operations manual and

the domestic mail manual are both consistent in that

application."     We disagree.   We find that the postmark on

the envelope in which the instant petition was mailed is a

postmark "not made by the United States Postal Service".

Thus, it is subject to section 7502(b) and the regulations

promulgated thereunder, quoted above.      The burden placed on

taxpayers by those regulations may be a difficult one but

that, by itself, does not permit us to find that the

regulations are invalid, as suggested by petitioner.       The

regulations were promulgated under the broad rule-making

authority given to the Commissioner by section 7502(b).

They have been held valid by this and other courts, and

nothing in petitioner's argument convinces us that the

regulations are unreasonable or plainly inconsistent with
                           - 11 -


the statute.   See Lindemood v. Commissioner, 566 F.2d 646,

649 (9th Cir. 1977), affg. per curiam T.C. Memo. 1975-195;

Fishman v. Commissioner, 51 T.C. 869, 872 (1969), affd. per

curiam 420 F.2d 491 (2d Cir. 1970).

     Moreover, we find that petitioner has failed to prove

the first condition imposed by the regulations, that the

petition was deposited in the mail before the last

collection of the mail on May 8, 1996, the last day of

the period prescribed for filing.    See sec. 301.7502-

1(c)(1)(iii)(b), Proced. & Admin. Regs.    To prove this

condition of the regulations, petitioner relies entirely

upon the testimony of Ms. Mosley.    At the hearing,

Ms. Mosley testified that she mailed the petition on

May 7, 1996, by depositing it in the mailboxes located

"in the basement of our building."    However, Ms. Mosley's

affidavit states that she mailed the petition by depositing

it in a mailbox in our building "just down the hall from

our office."   Ms. Mosley's affidavit states as follows:


     There is a U.S. Post Office mail box in our
     building just down the hall from our office.
     After weighing the envelope containing the
     required copies of the Tax Court petition, I
     affixed the necessary metered postage and hand
     carried this envelope and our other outgoing mail
     to that box well before 5:00 p.m. (it has a 5:00
     p.m. pickup daily) on May 7, 1996, just as I do
     every day before I leave the office at 5:00 p.m.
                            - 12 -


During the hearing, Ms. Mosley acknowledged this

discrepancy and attempted to explain it in the following

passage:


     Q     And your affidavit indicates that it was
           prepared on the 7th and mailed on the 7th.
           Your affidavit goes further on and says that
           the mailing room, the mailing facilities in
           this building is down the hall from your
           office.

             And you mailed this petition down the
           hall. Is that what your petition says?

     A     No.

     Q     Or your affidavit?

     A     No. It did not say that I mailed it down
           the hall. It said that there were mail
           boxes in our building just down the hall.

     Q     Yes. And then you go on to say you mailed
           this petition in those mail boxes.

     A     Correct.

     Q     Referring to the one down the hall?

     A     At the time I executed the affidavit they
           were located down the hall.

     Q     Okay.   And at the time that --

     A     At the time that they -- that I mailed it
           they were downstairs in the basement.

     Q     So today your testimony would be where did
           you mail this petition -- which Mr. Daily
           didn't ask. But if I asked you, Where did
           you mail this petition, it would be --

     A     In the basement of our building.

     Q     And that is different than the affidavit?
                             - 13 -


     A    Well, not in my opinion, no.

     Q    But the affidavit indicates that you mailed
          it in those mail boxes.

     A    Can you read that and show me that -- where
          it says that?

                     *   *    *    *     *   *   *

     Q    What else does it say?       As to where the
          mailboxes are located?

     A    Okay. That's on page two. "There is a U.S.
          Post Office mailbox in our building down the
          hall from our office."

     Q    Uh-huh.   Could you go on?

     A    "After weighing the envelope containing the
          required copies of the Tax Court petition, I
          fixed the necessary metered postage and hand
          carried this envelope and our other outgoing
          mail to that box well before 5:00 p.m."

     Q    "That box." Were you referring to the box
          down the hall?

     A    I was referring to the box in our building
          -- because the boxes were not down the hall
          on May 7th.


In view of the above discrepancy in Ms. Mosley's statements

regarding where the mailboxes were located at the time she

allegedly deposited the envelope containing the petition in

the mail, we are not convinced that the petition was

deposited in the mail on or before May 8, 1996, as required

by section 301.7502-1(c)(1)(iii)(b), Proced. & Admin. Regs.

See Little v. Commissioner, T.C. Memo. 1995-491.
                          - 14 -


     Because petitioner has not established that section

7502 applies, we cannot find that the petition was filed

within the time required by section 6213(a) and, therefore,

we shall grant respondent's motion to dismiss for lack of

jurisdiction.

     To reflect the foregoing,


                                 An appropriate order will

                          be entered granting respondent's

                          motion to dismiss.
