Merrick S. Rayle v. Commissioner of Internal Revenue

United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Submitted November 26, 2014 *
Decided December 8, 2014
Before
ANN CLAIRE WILLIAMS, Circuit Judge
DIANE S. SYKES, Circuit Judge
DAVID F. HAMILTON, Circuit Judge
No. 13‐3699
MERRICK S. RAYLE,
Petitioner‐Appellant,
v.
COMMISSIONER OF INTERNAL
REVENUE,
Respondent‐Appellee.
Appeal from the United States Tax Court.
No. 8466‐13S
John O. Colvin,
Chief Judge.
O R D E R
Merrick Rayle appeals from the Tax Court’s dismissal of his small tax case.
Because we lack jurisdiction over the appeal, we dismiss.
The Internal Revenue Service mailed a notice of deficiency to Rayle’s last known
address on January 8, 2013, triggering a 90‐day deadline for him to challenge the
deficiency determination. See 26 U.S.C. § 6213(a). The notice informed Rayle that he
owed unpaid taxes and penalties for tax years 2009 and 2010, and that he could contest
* After examining the briefs and the record, we have concluded that oral
argument is unnecessary. Thus the appeal is submitted on the briefs and the record.
See FED. R. A PP. P. 34(a)(2)(C).
NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with Fed. R. App. P. 32.1

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No. 13‐3699 Page 2
the IRS’s determination by filing a petition with the Tax Court by April 8, 2013—90 days
after the notice of deficiency was mailed. By statute the Tax Court “shall have no
jurisdiction” to hear a challenge to a deficiency determination if the taxpayer’s petition is
filed after this 90‐day deadline. See id.; Petrulis v. C.I.R., 938 F.2d 78, 79 (7th Cir. 1991);
Meruelo v. C.I.R., 691 F.3d 1108, 1115 (9th Cir. 2012); Selgas v. C.I.R., 475 F.3d 697, 699 (5th
Cir. 2007).
The notice of deficiency also informed Rayle that simplified procedures are
available to taxpayers who elect to contest their deficiencies as “small tax cases.” These
small‐tax‐case procedures are available only if the amount in dispute for each tax year is
$50,000 or less. Rayle’s case qualified because he owed a total of $36,616 in taxes and
$7,323 in penalties. To use this procedure, Rayle needed only to check a box on the form
that the IRS had mailed to him and return it. See 26 U.S.C. § 7463(a); T.C. Form 2, U NITED
STATES T AX C OURT, available at https://www.ustaxcourt.gov/forms/Petition_Kit.pdf (last
visited Nov. 3, 2014).
The deficiency notice warned Rayle that a taxpayer who elects the “small tax
case” procedure cannot appeal the Tax Court’s decision. Complete information on the
procedure, the notice explained, was available by mail and on the Tax Court’s website.
The website elaborates on the advantages to the taxpayer of small‐tax‐case proceedings:
convenience (trials in small tax cases are held in about 15 more locations than regular tax
trials) and streamlined procedural rules. Taxpayer Information: Starting a Case, U NITED
STATES T AX C OURT, https://www.ustaxcourt.gov/taxpayer_info_start.htm#START12 (last
visited Nov. 3, 2014); see T AX C T . R. 174 (“Trials of small tax cases will be conducted as
informally as possible consistent with orderly procedure, and any evidence deemed by
the Court to have probative value shall be admissible.”). Like the notice, the website also
alerts taxpayers that a decision in a small tax case cannot be reviewed by a United States
Court of Appeals. See Taxpayer Information: Starting a Case, supra.
Ray elected to contest his tax deficiency as a small tax case by checking the
appropriate box and returning the petition form. (Like the deficiency notice and website,
the form also warned him that a decision in a small tax case is not appealable.) Rayle
filed his petition on April 16, 2013, eight days after the 90‐day deadline.
The Commissioner moved to dismiss Rayle’s case, arguing that the Tax Court
lacked jurisdiction because the petition was untimely. Rayle responded that his untimely
filing should be excused because he was away from his home when the notice of
deficiency was mailed and thus did not receive it until ten days later, on January 18,
2013. The Tax Court granted the Commissioner’s motion and dismissed the petition for

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No. 13‐3699 Page 3
lack of jurisdiction. The Tax Court explained that by statute a petition is timely only if it
is filed within 90 days after the notice of deficiency is mailed. Rayle’s absence from home
when the IRS mailed the notice was irrelevant, the court observed, because the statute
required only that the IRS mail the notice to his “last known address,” not deliver it to
him personally.
Rayle argues on appeal that the Tax Court erred when it refused to allow him
extra time to submit his petition. The Commissioner responds that we cannot address
this challenge because we lack jurisdiction to review the Tax Court’s decisions in small
tax cases.
The Commissioner is correct. The Tax Court’s dismissal of a case for lack of
jurisdiction is a “decision.” See 26 U.S.C. § 7459(c), (d). And the statute governing small
tax cases provides that “[a] decision entered in any case in which the proceedings are
conducted under this section shall not be reviewed in any other court and shall not be
treated as a precedent for any other case.” Id., § 7463(b). This statutory language and the
legislative history behind it “demonstrate that Congress intended to preclude judicial
review of all ‘decisions’ in small tax cases.” Dexter v. C.I.R., 409 F.3d 877, 879 (7th Cir.
2005); see Cole v. C.I.R., 958 F.2d 288, 289–90 (9th Cir. 1992). When Congress clearly
intends a statutory provision to be jurisdictional, we must treat is as such. See Sebelius v.
Auburn Reg’l Med. Ctr., 133 S. Ct. 817, 824 (2013). Thus we lack jurisdiction to review the
Tax Court’s decision to dismiss Rayle’s case.
Rayle does not dispute that this is a small tax case, nor could he. Both the notice of
the deficiency and the petition form warned Rayle that, by choosing to conduct his case
as a small tax case, he would forgo judicial review of the Tax Court’s decision. Rayle
chose the small‐tax‐case procedures by checking the appropriate box on his petition, and
the Tax Court concurred in his choice by declining to remove the small‐tax‐case
designation he had selected. See 26 U.S.C. § 7463(a); T AX C T . R. 171(a), (d).
In closing, we note that Rayle may not be without recourse. Because he did not
file his petition within the time prescribed by § 6213(a), he may still pay the amount
assessed by the IRS, request a refund, and—if the request is denied—sue in federal court.
See 26 U.S.C. §§ 7422, 6512(a); Cheek v. United States, 498 U.S. 192, 206 (1991); Pagonis v.
United States, 575 F.3d 809, 812 (8th Cir. 2009); Hudson Valley Black Press v. I.R.S., 409 F.3d
106, 111 (2d Cir. 2005).
DISMISSED.

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