Arbor Vita Corporation D.B.A. Hemediagnostics

United States Tax Court

166 T.C. No. 5

ARBOR VITA CORPORATION d.b.a. HEMEDIAGNOSTICS,

Petitioner

v.

COMMISSIONER OF INTERNAL REVENUE,

Respondent

—————

Docket No. 4172-25L. Filed March 16, 2026.

—————

P, a corporation organized under California law, has

unpaid unemployment tax and civil penalty liabilities for

taxable year 2017. After holding a CDP hearing, R issued

to P a Notice of Determination for 2017. P filed a Petition

within 30 days of issuance of the Notice of Determination.

When P filed the Petition, its corporate status was

suspended under California law for its failure to file certain

state tax returns. P revived its corporate status after the

filing of the Petition and the expiration of the I.R.C.

§ 6330(d)(1) 30-day limitations period.

R moved the Court to dismiss this case for lack of

jurisdiction on the ground that P lacked capacity under Tax

Ct. R. Prac. & P. 60(c) to initiate this proceeding because

its corporate status was suspended under California law at

the time the 30-day period of limitations expired.

Held: P did not have the capacity to file a Petition

under Tax Ct. R. Prac. & P. 60(c) because under California

law its revival does not relate back to the date it filed its

Petition.

Served 03/16/26

2

Held, further, the doctrine of equitable tolling is

inapplicable in this case.

Held, further, this Court lacks jurisdiction.

—————

Eric G. Pearson, for petitioner.

Sarah A. Herson and Joanne H. Kim, for respondent.

OPINION

LANDY, Judge: On April 3, 2025, petitioner, Arbor Vita Corp.,

doing business as Hemediagnostics (Arbor Vita), petitioned this Court

for review, pursuant to sections 6320(c) 1 and 6330(d)(1), of a

determination by the Internal Revenue Service (IRS) Independent

Office of Appeals sustaining the filing of a notice of federal tax lien

(NFTL) to collect unpaid unemployment tax and civil penalty liabilities

for taxable year 2017. The Commissioner now moves this Court to

dismiss Arbor Vita’s Petition for lack of jurisdiction, contending that the

Petition was not filed by a party with capacity to maintain an action

under Rule 60(c). More specifically, the Commissioner maintains that

Arbor Vita lacked capacity to file a petition because its corporate status

was suspended when the 30-day period of limitations (30-day period)

expired.

For the reasons stated below, we agree with the Commissioner,

and we will grant the Motion to Dismiss for Lack of Jurisdiction

(Motion).

Background

On May 5, 1998, Arbor Vita was organized as a corporation under

California law. Pursuant to Cal. Rev. & Tax. Code §§ 23301 and 23302

(West 2025), Arbor Vita’s powers, rights, and privileges as a California

corporation were suspended as of July 1, 2024, for its failure to file

certain state tax returns. For taxable year 2017 the IRS determined that

1 Unless otherwise indicated, statutory references are to the Internal Revenue

Code, Title 26 U.S.C., in effect at all relevant times, and Rule references are to the Tax

Court Rules of Practice and Procedure.

3

Arbor Vita failed to pay its unemployment tax liability and further

assessed a section 6721 penalty for failure to file Forms W–2, Wage and

Tax Statement, with the Social Security Administration. The IRS

subsequently sent Arbor Vita notice that it had filed the NFTL to collect

the outstanding liability and penalty. Arbor Vita timely requested and

participated in a collection due process (CDP) hearing with the IRS

regarding the proposed collection action. While Arbor Vita’s corporate

status was suspended, the Commissioner sustained the filing of the

NFTL in a Notice of Determination Concerning Collection Actions

Under Sections 6320 or 6330 of the Internal Revenue Code (Notice of

Determination), dated March 6, 2025.

Arbor Vita’s corporate status remained suspended when it filed a

timely Petition with this Court on April 3, 2025. At that time, Arbor

Vita’s principal place of business was in California. 2 On September 17,

2025, Arbor Vita received a Certificate of Revivor, its corporate status

was reinstated, and it returned to being a corporation in good standing

with the California Franchise Tax Board (FTB).

Discussion

The Commissioner moves to dismiss this case for lack of

jurisdiction because Arbor Vita’s corporate status was suspended at the

time it filed its Petition and remained suspended through the expiration

of the 30-day period. Arbor Vita maintains that this Court should deny

the Motion because (1) a Certificate of Revivor retroactively validates a

timely petition filed by a suspended corporation under California law

and (2) good cause exists to apply equitable tolling.

First, because we apply state law to determine corporate capacity,

we must consider whether under California law Arbor Vita’s corporate

revival relates back to when it filed its Petition. See Rule 60(c). For the

reasons stated below, we determine that it does not. Thus, Arbor Vita

lacked capacity under Rule 60(c) to file its Petition. Consequently, we

must also determine whether equitable tolling applies to a timely filed

petition filed by a corporation without capacity. We hold it does not.

I. Jurisdiction and corporate capacity

We are a legislatively created court; consequently, our

jurisdiction flows directly from Congress. David Dung Le, M.D., Inc. v.

2 Absent stipulation to the contrary, this case is appealable to the U.S. Court

of Appeals for the Ninth Circuit. See § 7482(b)(1)(G)(ii), (2).

4

Commissioner, 114 T.C. 268, 269 (2000) (and cases cited thereat), aff’d,

22 F. App’x 837 (9th Cir. 2001); see § 7442. This Court is a court of

limited jurisdiction and lacks general equitable powers. Commissioner

v. McCoy, 484 U.S. 3, 7 (1987); Commissioner v. Gooch Milling &

Elevator Co., 320 U.S. 418, 420 (1943). “Whether we have jurisdiction to

decide a matter is an issue that a party, or this or an appellate court sua

sponte, may raise at any time.” David Dung Le, M.D., Inc., 114 T.C.

at 269.

Arbor Vita bears the burden of proving all facts necessary to

establish our jurisdiction. See id. at 270; Patz Tr. v. Commissioner, 69

T.C. 497, 503 (1977). First, Arbor Vita must establish that the

Commissioner issued to it a valid Notice of Determination. Craig v.

Commissioner, 119 T.C. 252, 256 (2002). Second, Arbor Vita must

demonstrate it had the requisite capacity to initiate and participate in a

proceeding before this Court. See Rule 60(a), (c). There is no dispute that

the Commissioner issued a Notice of Determination to Arbor Vita. Thus,

Arbor Vita must establish it met the capacity requirements. Rule 60(c)

provides that “[t]he capacity of a corporation to engage in . . . litigation

[in this Court] shall be determined by the law under which it was

organized.” See NT, Inc. v. Commissioner, 126 T.C. 191, 193 (2006);

David Dung Le, M.D., Inc., 114 T.C. at 270. Arbor Vita was organized

under the laws of California, and thus, California law controls our

capacity determination.

A. Revivor and relation back of corporate status under

California law

In California the FTB may suspend the “powers, rights, and

privileges of a domestic taxpayer” if the corporation fails to pay “any tax,

penalty, or interest, or any portion thereof, that is due and payable” at

specified times. Cal. Rev. & Tax. Code § 23301 (West 2025); accord Grell

v. Laci Le Beau Corp., 87 Cal. Rptr. 2d 358, 362 (Ct. App. 1999) (citing

Reed v. Norman, 309 P.2d 809, 812 (Cal. 1957)). Once a corporation’s

powers are suspended, it “may not prosecute or defend an action.” Reed,

309 P.2d at 812. A corporation may revive its status upon payment of its

tax liability and written application to the FTB. Cal. Rev. & Tax. Code

§ 23305 (West 2025).

California law, however, provides that “[p]rocedural acts in the

prosecution or defense of a lawsuit are validated retroactively by

corporate revival,” and “[m]ost litigation activity [is] characterized as

procedural for purposes of corporate revival.” Benton v. Cnty. of Napa,

5

277 Cal. Rptr. 541, 545 (Ct. App. 1991). Consequently, “[o]n revivor of

its corporate powers a corporation may continue an action commenced

during the period of suspension and not previously dismissed, even

though the opposing party pleaded the suspension prior to the revivor.”

A.E. Cook Co. v. K S Racing Enters., Inc., 79 Cal. Rptr. 123, 123–24 (Ct.

App. 1969). To the contrary, substantive acts are not validated upon

revival. Welco Constr., Inc. v. Modulux, Inc., 120 Cal. Rptr. 572, 575 (Ct.

App. 1975).

Any revival “shall be without prejudice to any action, defense, or

right which has accrued by reason of the original suspension or

forfeiture.” Cal. Rev. & Tax. Code § 23305a (West 2025). In other words,

if relation back of revival would prejudice or invalidate an opposing

party’s defense that accrued because of the suspension of corporate

status, regardless of the nature of that defense, then revivor cannot

retroactively validate an otherwise procedural act. Cmty. Elec. Serv. of

L.A., Inc. v. Nat’l Elec. Contractors Ass’n, 869 F.2d 1235, 1240 (9th Cir.

1989) (holding that revivor did not relate back to validate the otherwise

timely commencement of an action when revivor occurred after the

expiration of the period of limitations because relation back would

prejudice the opposing party’s statute of limitations defense);

see Benton, 277 Cal. Rptr. at 545–46.

B. Change in this Court’s treatment of section 6330(d)(1)

deadline after Boechler

Statutes of limitations are generally procedural because they

“‘promote the orderly progress of litigation’ but do not bear on a court’s

power.” Boechler, P.C. v. Commissioner, 142 S. Ct. 1493, 1497 (2022)

(quoting Henderson ex rel. Henderson v. Shinseki, 562 U.S. 428, 435

(2011)); see also United States v. Wong, 575 U.S. 402, 410 (2015). A

statute of limitations that also serves as a jurisdictional grant is

substantive rather than procedural because it confers rights upon a

party and “failure to comply with the [time] bar deprives a court of all

authority to hear a case.” Wong, 575 U.S. at 408–09.

In Boechler, P.C. v. Commissioner, 142 S. Ct. 1493, the Supreme

Court considered whether the 30-day period to file a petition is

jurisdictional. The Supreme Court held that section 6330(d)(1) provides

“an ordinary, nonjurisdictional deadline subject to equitable tolling.”

Boechler, P.C. v. Commissioner, 142 S. Ct. at 1501. Therefore, for

purposes of CDP cases arising out of California, lack of corporate status

6

at the time of filing a petition does not inherently bar relation back upon

revival. See Cal. Rev. & Tax. Code § 23305a (West 2025).

The holding in Boechler distinguishes this case from our

precedent regarding corporate revival of California corporations. Past

jurisprudence primarily addressed petitions filed pursuant to section

6213(a) and held that revival of corporate status did not relate back

because this Court, as well as the Ninth Circuit, treats the 90-day

deadline as a jurisdictional, and therefore substantive, rule. 3 See David

Dung Le, M.D., Inc., 114 T.C. at 270; see also John C. Hom & Assocs. v.

Commissioner, 140 T.C. 210, 215 (2013); Timbron Int’l Corp. v.

Commissioner, T.C. Memo. 2019-31, at *10–11; Matthews v.

Commissioner, T.C. Memo. 2015-78, at *3, *8. 4 In sum, Boechler created

some flexibility for corporate taxpayers that file a petition while their

corporate status is suspended but is revived before the expiration of the

30-day period.

II. Whether Arbor Vita had corporate capacity to file its Petition

Arbor Vita did not have the requisite corporate status when it

received the Notice of Determination because the FTB had suspended

its status on July 1, 2024. Arbor Vita remained without corporate status

when it filed its Petition on April 3, 2025 (within the 30-day period), and

until September 17, 2025, when the FTB deemed it to be in good

standing. Following Boechler, Arbor Vita’s lack of good standing at the

time it filed its Petition does not itself bar our jurisdiction over its case

because section 6330(d)(1) provides a nonjurisdictional, procedural

deadline. See Boechler, P.C. v. Commissioner, 142 S. Ct. at 1501; see also

Benton, 277 Cal. Rptr. at 544–45.

3 Both the Ninth Circuit and this Court have addressed petitions filed pursuant

to section 7428, see AMA Enters., Inc. v. Commissioner, 523 F. App’x 455 (9th Cir.

2013); see also XC Found. v. Commissioner, T.C. Memo. 2023-3, aff’d, No. 23-70060,

2024 WL 2843037 (9th Cir. June 5, 2024), which this Court also treats as jurisdictional,

e.g., CRSO v. Commissioner, 128 T.C. 153, 157 (2007).

4 We note that our characterization of statutes of limitations in Matthews as

“substantive,” Matthews, T.C. Memo. 2015-78, at *7, remains valid as it applies to

section 6213(a) (and other jurisdictional statutes of limitations) because section

6213(a) grants rights to taxpayers rather than merely facilitating those rights, see

Boechler, 142 S. Ct. at 1497; see also Organic Cannabis Found., LLC v. Commissioner,

962 F.3d 1082, 1092–95 (9th Cir. 2020); Hallmark Rsch. Collective v. Commissioner,

159 T.C. 126, 166–67 (2023).

7

Notwithstanding, 31 days after issuing the Notice of

Determination, the Commissioner accrued a statute of limitations

defense against any petition filed by Arbor Vita. See Cmty. Elec. Serv. of

L.A., 869 F.2d at 1240. To retroactively validate Arbor Vita’s Petition at

this juncture would prejudice the Commissioner’s defense by effectively

nullifying it because Arbor Vita’s Petition would be considered valid and

timely filed. Therefore, under California law, we cannot relate Arbor

Vita’s corporate revival back to the time it filed its Petition. See Rule

60(c); Cal. Rev. & Tax. Code § 23305a (West 2025); Cmty. Elec. Serv. of

L.A., 869 F.2d at 1241.

The Ninth Circuit addressed a nearly identical situation in

Community Electric Service of Los Angeles, 869 F.2d 1235. In that case,

Community Electric was without corporate status at the time it filed an

otherwise timely antitrust complaint, and its status was not revived

until after the nonjurisdictional period of limitations expired. Id.

at 1238–39. The Ninth Circuit applied California law to determine

whether Community Electric’s revival could relate back. The Ninth

Circuit held that the statute of limitations defense barred relation back

because relation back would prejudice that defense. Id. at 1240–41.

Similarly, we are obligated to follow California law, and we decline to

retroactively validate Arbor Vita’s Petition.

Arbor Vita maintains that “[b]ecause the 30-day [period] in CDP

cases is not jurisdictional, California’s retroactive rule for procedural

deadlines for notices of appeal applies” and that this Court should

retroactively validate its Petition. Obj. to Mot. to Dismiss for Lack of

Jurisdiction 6. Although California courts may relate back an entity’s

corporate status to retroactively validate the filing of a notice of appeal,

see Bourhis v. Lord, 295 P.3d 895, 900–01 (Cal. 2013), statutes of

limitations provide a defense contemplated by Cal. Rev. & Tax. Code

§ 23305a, and the expiration of the time to file a notice of appeal does

not, Bourhis, 295 P.3d at 900–01. Furthermore, this Court is not an

appellate court, as evidenced by the Supreme Court’s characterization

of this Court’s “role in the federal judicial scheme [as] closely

resembl[ing] [that] of the federal district courts.” Freytag v.

Commissioner, 501 U.S. 868, 891 (1991). Arbor Vita has supplied no

reason why this Court should now consider its Petition a notice of

appeal, and we see no reason to do so.

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III. Whether equitable tolling applies

Arbor Vita urges this Court to apply the doctrine of equitable

tolling if revival does not relate back to the date the Petition was filed.

“Equitable tolling ‘effectively extends an otherwise discrete limitations

period set by Congress.’” Belagio Fine Jewelry, Inc. v. Commissioner, 164

T.C. 163, 167 (2025) (quoting Lozano v. Montoya Alvarez, 572 U.S. 1, 10

(2014)). “To be entitled to equitable tolling, a taxpayer must establish

(1) that it pursued its rights diligently and (2) that extraordinary

circumstances outside of its control prevented it from filing on time.” Id.

at 172. While this Court may equitably toll the section 6330(d)(1)

deadline following Boechler, P.C. v. Commissioner, 142 S. Ct. at 1501,

Arbor Vita timely filed its Petition. Consequently, there is no extension

we can grant Arbor Vita, and equitable tolling does not apply.

IV. Conclusion

For the reasons discussed, we determine that Arbor Vita did not

have the requisite corporate capacity, pursuant to Rule 60(c), when it

filed its Petition, and the doctrine of equitable tolling is inapplicable in

this case. Consequently, we will grant the Commissioner’s Motion.

We have considered all remaining arguments and, to the extent

not addressed above, find them to be moot, irrelevant, or without merit.

To reflect the foregoing,

An order of dismissal for lack of jurisdiction will be entered.