Opinion
Miscellaneous Action: MS2 03-10; Miscellaneous Action: MS2 03-11; Miscellaneous Action: MS2 03-13
July 10, 2003
REPORT AND RECOMMENDATION
Respondent in these cases, United States Internal Revenue Service (hereinafter "IRS"), issued summonses on February 10, 2003 to Key Bank in order to obtain bank records of Community Home Health Services, Inc., the taxpayer. Exhibit A, attached to Petition to Quash. Kevin and Jacqueline Dennis were identified on the summonses as "potentially responsible persons." Id. The following day, February 11, 2003, the IRS sent a copy of the summonses to the Dennis' as well as instructions on filing a petition to quash. Petition to Quash, at ¶ 3. That notice specifically advised that a motion to quash must be filed within twenty (20) days. Exhibit A, attached to Petition to Quash. The petition to quash was filed in each case on March 5, 2003 — i.e. 22 days after the notices were mailed. This matter is now before the court on the March 8, 2003 motion to dismiss each case as untimely filed. There has been no response by petitioners to the motion.
A person entitled to notice of a third party summons "shall have the right to begin a proceeding to quash such summons not later than the 20th day after the day such notice is given in the manner provided in subsection (a)(2)." 26 U.S.C. § 7609(b)(2)(A). Section 7609(a)(2) provides in relevant part, "Such notice shall be sufficient if, on or before such third day, [after issuance of the summons], such notice . . . is mailed by certified or registered mail to the last known address of such person, or, in the absence of a last known address, is left with the person summoned." 26 U.S.C. § 7609(a)(2). The United States Court of Appeals for the Sixth Circuit has held that notice is "`given in the manner provided in subsection (a)(2)' on the date on which notice is mailed to the taxpayer under investigation by certified or registered mail." Clay v. United States, 199 F.3d 876, 878 (6th Cir. 1999) citing Faber v. United States, 92 1 F.2d 1118, 1119 (10th Cir. 1990) and Stringer v. United States, 776 F.2d 274, 275 (11th Cir. 1985); Shisler v. United States, 199 F.3d 848, 850 (6th Cir. 1999). Moreover, the time limitation for filing a petition to quash is jurisdictional. Shisler, 199 F.3d 848; Clay, 199 F.3d 876.
The IRS mailed notice of the summonses to Kevin and Jacqueline Dennis on February 11, 2003, within three days of issuing the summonses. Petition to Quash, at ¶ 3. The petitions to quash should therefore have been filed by March 3, 2003 to be considered timely. However, the petitions were not filed until March 5, 2003, two days late. Under similar facts, in Clay, the Sixth Circuit ruled that the filing was untimely and that the district court lacked jurisdiction over the petition. 199 F.3d at 878. See also Shisler, 199 F.3d at 852 (affirming district court's decision to dismiss petitioners' motion to quash, filed twenty-two or twenty-three days after notice was given, for lack of jurisdiction). Because the petitions to quash were untimely filed, this Court lacks jurisdiction in these cases.
The United States asserts in its motion to dismiss — but without any evidentiary support — that notice was made by certified mail. Motion to Dismiss, at ¶ 3. However, petitioners do not dispute this assertion.
IT IS THEREFORE RECOMMENDED that the motion to dismiss the petitions to quash be GRANTED.
If any party seeks review by the District Judge of this Report and Recommendation, that party may, within ten (10) days, file and serve on all parties objections to the Report and Recommendation, specifically designating this Report and Recommendation, and the part thereof in question, as well as the basis for objection thereto. 28 U.S.C. § 636(b)(1).
The parties are specifically advised that failure to object to the Report and Recommendation will result in a waiver of the right to de novo review by the District Judge and of the right to appeal the decision of the District Court adopting the Report and Recommendation, See Thomas v. Arn, 474 U.S. 140 (1985); Smith v. Detroit Federation of Teachers, Local 231, etc., 829 F.2d 1370 (6th Cir. 1987); United States v. Walters, 638 F.2d 947 (6th Cir. 1981).