Last week Carl posted shortly after the release of Notice 2020-23 which granted broad relief to taxpayers, and the IRS, with respect to time frames set out in the Internal Revenue Code (IRC). In the preamble to Carl’s post I noted that the Notice also extended the 30-day time period to make a Collection Due Process (CDP) request. One reader questioned whether the Notice did extend the time for making a CDP request. That inquiry and others plus the benefit of more time caused those of us at PT blog central to spend a little more time parsing the language of the Notice to decide whether the Notice really did extend the CDP time period and to decide other things about the extent of the time suspensions. What follows is some parsing and some observations.
The Notice is unprecedented in that we have not previously had a nationwide “disaster” that allows the IRS to invoke the time suspension provisions of IRC 7508A on a scale that encompasses the entire country. Usually, when the IRS uses its authority under 7508A it does so in a manner limited to the geographic area impacted by the disaster. For example, when Hurricane Katrina hit the IRS issued a Notice granting relief for those areas in states principally bordering the Gulf of Mexico that were impacted by the hurricane. Here, everyone in the United States is implicated. [As an aside I note that US citizens worldwide are implicated as well but the Notice only seems to cover those residing in the US.]
The Notice follows the language of IRC 7508A and in doing so uses two terms of art from the statute. The first term applicable here is Affected Taxpayer. The Notice defines Affected Taxpayer with the following statement in the grant of relief Section III A:
The Secretary of the Treasury has also determined that any person performing a time-sensitive action listed in either § 301.7508A-1(c)(1)(iv) – (vi) of the Procedure and Administration Regulations or Revenue Procedure 2018-58, 2018-50 IRB 990 (December 10, 2018), which is due to be performed on or after April 1, 2020, and before July 15, 2020 (Specified Time-Sensitive Action), is an Affected Taxpayer.
The Notice not only refers to persons performing time-sensitive actions listed in three subparagraphs of the 7508A regulations which enumerate several time sensitive actions but also sweeps in the actions in Rev. Proc. 2018-58. The three subparagraphs of the regulation cover the following actions:
(iv) Filing a petition with the Tax Court, or for review of a decision rendered by the Tax Court;
(v) Filing a claim for credit or refund of any tax;
(vi) Bringing suit upon a claim for credit or refund of any tax;
The regulation contains other subparagraphs that did not get swept in through this language including subparagraph (vii) which extends the time for “Any other act specified in a revenue ruling, revenue procedure, notice, announcement, news release, or other guidance published in the Internal Revenue Bulletin (see § 601.601(d)(2) of this chapter).” So, Notice 2020-23 did not go as far as it could possibly have gone in bringing over all of the possible time frames that could impact taxpayers.
The Notice did, however, also reference Rev. Proc. 2018-58 where the IRS lists pages of code sections that have time sensitive tasks for taxpayers to perform. The IRS created Rev. Proc. 2018-58 so that it would have a handy reference to the time sensitive provisions of the code it could reference in issuing a disaster order. Included in the Rev. Proc. is the 30- day period for requesting a CDP hearing.
So far so good on the correctness of the statement that the period for filing a CDP request was extended by the Notice; however, we need to look at the second term of art used in the Notice and there things get a little stickier.
The second term of art in the Notice is Specified Time Sensitive Action. The Notice addresses this term in Section III C. where it provides:
Affected Taxpayers also have until July 15, 2020, to perform all Specified Time-Sensitive Actions, that are due to be performed on or after April 1, 2020, and before July 15, 2020. This relief includes the time for filing all petitions with the Tax Court, or for review of a decision rendered by the Tax Court, filing a claim for credit or refund of any tax, and bringing suit upon a claim for credit or refund of any tax. This notice does not provide relief for the time period for filing a petition with the Tax Court, or for filing a claim or bringing a suit for credit or refund if that period expired before April 1, 2020.
This part of the Notice specifically mentions some of the acts covered but does not reference back to the 7508A regulation or to Rev. Proc. 2018-58. After much back and forth we decided that the parenthetical in Section III A. describing certain actions in the 7508A regulations and actions in Rev. Proc. 2018-50 follow by “(Specified Time Sensitive Actions)” created the definition of Specified Time Sensitive Actions intended in Section III C.
If that interpretation of the definition is correct then Specified Time Sensitive Actions includes all of the code sections mentioned in Rev. Proc. 2018-58 making the time for requesting a CDP hearing one of the items suspended by the Notice. Of course, the CDP time period is just one of a large number of time periods and is cited here simply as an example.
Understanding Notice 2020-23 requires a lot of back and forth with the regulations under 7508A and with Rev. Proc. 2018-58. Still, there are some time periods not mentioned in either place that could impact a taxpayer. For example, if a taxpayer receive a math error notice provided by IRC 6213(b)(1) on March 1, 2020, the taxpayer would have 60 days pursuant to IRC 6213(b)(2) to request an abatement of the math error notice and force the IRS to use the deficiency procedures in order to make the assessment, that taxpayer would appear to still need to make the request for abatement by April 30, 2020 in order to avoid missing the chance to go to Tax Court because neither the 7508A regulations nor Rev. Proc. 2018-58 mention the math error time period .
This example regarding the math error time period is not intended to criticize the relief in Notice 2020-23 but merely to suggest that the very broad suspension that it provides does not necessarily cover ever provision that might impact a taxpayer. If you are relying on a suspension in the notice to cover the specific situation that impacts your client, you may want to find that provision in the language of the Notice, or in the subparagraphs of the regulations cited or in Rev. Proc. 2018-58 in order to feel comfortable.