The opinion
BERNARD PEARL, PETITIONER, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT.
Pearl v. Commissioner
Docket No. 52281.
United States Board of Tax Appeals
27 B.T.A. 1198 ; 1933 BTA LEXIS 1232 ;
April 20, 1933 , Promulgated
*1232 Petitioner is the sole distributee of the assets of an estate against which the Board on November 19, 1929, redetermined a deficiency. Held, that a proceeding to collect such deficiency from him as a transferee was timely begun on December 4, 1930.
Brice Clagett, Esq., for the petitioner.
H. B. Hunt, Esq., for the respondent.
LANSDOX
*1198 The respondent has determined that under the provisions of section 280 of the Revenue Act of 1926 the petitioner is liable as a transferee for the unpaid Federal income tax of the estate of Ben Pearl for the year 1918. The only defense pleaded is that at the date of the determination the statute of limitations had run both as to the original deficiency and the transferee's liability. The parties have filed a stipulation, from which we make the following findings of fact.
FINDINGS OF FACT.
The petitioner is an individual, residing at Auguilla, Mississippi. He is the sole beneficiary and distributee of the estate of his father, Ben Pearl, who died testate on October 20, 1919, and in his will named Henry Kline as executor and the petitioner as sole legatee of his estate. Kline qualified as such *1233 executor October 23, 1919. On October 21, 1925, the Commissioner received a copy of the order of the Chancery Court of Sharkey County, Mississippi, dated September 23, 1925, discharging Kline as executor.
On February 13, 1923, and February 11, 1924, Kline executed unlimited waivers identical in form, except as to dates, extending the time for determination, assessment and collection of any taxes due under any return made for or in behalf of Ben Pearl for the years 1917, 1918 and 1919. On January 6, 1925, the Commissioner *1199 made an assessment under section 274(d) of the Revenue Act of 1924 of additional income tax for the year 1918 against the estate of Ben Pearl in the amount of $6,427.34. Within ten days after notice and demand for the payment of such assessment, a claim for abatement was filed. On March 30, 1926, the Commissioner denied such claim and mailed a notice asserting a deficiency in the amount thereof to the estate of Ben Pearl.
On May 26, 1926, an appeal from the determination of March 30, 1920, entitled "Estate of Ben Pearl, by Henry Kline, former executor and Bernard Pearl, sole distributee," was duly filed with the Board of Tax Appeals. On November 18, 1929, the *1234 Board promulgated its findings of fact and opinion in such appeal at . On November 19, 1929, it entered its order and decision in which the deficiency was redetermined in the amount of $6,427.34 as asserted by the Commissioner.
The deficiency redetermined by the Board in its order entered November 19, 1929, has not been paid. On December 4, 1930, the Commissioner mailed to the petitioner the letter upon which this proceeding is based and therein advised such petitioner of his liability as a transferee for the unpaid income tax of the estate of Ben Pearl for the year 1918 in the amount of $6,427.34.
OPINION.
LANSDON: The primary contention of the petitioner is that the determination of liability under section 280 of the Revenue Act of 1926 was not timely made because the statute of limitations ran against any liability of the estate of Ben Pearl for unpaid taxes for the year 1918 not later than March 20, 1927. If this contention is sound the petitioner must prevail, since the notice of liability upon which the proceeding is based was not mailed until December 4, 1930, which is more than one year after the date at which it is alleged that the original *1235 taxpayer's liability was tolled by the statute of limitations.
In support of his position the petitioner argues that the unlimited waivers filed as set out in our findings of fact and received and approved by the Commissioner could not extend the time for determination, assessment and collection since they were not signed by any one having authority to act for the estate of Ben Pearl. He further argues that if such waivers were void as alleged, then the appeal taken at Docket No. 16433 and all the proceedings in relation thereto were negatory and without effect to stay the running of the statute of limitations as provided at section 274(a) of the Revenue Act of 1926.
*1200 This identical question was submitted to the Board in the proceedings at , and we decided contrary to the contentions of the petitioner on the authority of ; Cf. . Since neither of these decisions has been overruled, modified or reversed by the Board or the courts, we are unable to agree with the petitioner that the proceedings at Docket *1236 No. 16433 should be regarded as a nullity.
The deficiency here involved was asserted against the original taxpayer on March 30, 1926, which was within the statutory period as extended by valid waivers. Estate of Ben Pearl, supra. On May 27, 1926, the appeal at Docket No. 16433 was filed and the running of the statute of limitations was thereby extended to the date on which the decision of the Board became final, which under section 1001(a) of the Revenue Act of 1926 was six months after such decision on November 19, 1929, or May 19, 1930. This proceeding under section 280 was begun on December 4, 1930, which was well within one year after May 19, 1930, and so was in time under the provisions of section 274(a) of the Revenue Act of 1926. It is stipulated that the petititioner here is the sole distributee of the original taxpayer's assets of a value in excess of the deficiency. He is liable for any unpaid Federal taxes against the estate of Ben Pearl for the year 1918. .
Decision will be entered for the respondent.