- 5 -
Petitioners failed to present any corroborating evidence as to
the purported mailing of Form 2553. See Anderson v. United States,
966 F.2d 487, 491 (9th Cir. 1992) (holding that under the common-
law mailbox rule, a rebuttable presumption of delivery arises where
there is evidence of timely mailing). As a paralegal who owned a
business that prepared legal documents, petitioner should have
understood the significance of complying with the requirements for
Legal Search's making an S corporation election. He should have
taken steps to verify that the election was properly made. He
failed to do so.
At trial, respondent presented credible evidence that the Form
2553 was not delivered. Consequently, we hold that petitioners
have failed to satisfy their burden and thus may not deduct the
claimed 1995 loss arising from Legal Search.
On their 1994 Federal income tax return, petitioners reported
a $25,565 loss arising from Legal Search's activities and received
a $1,783 refund. Petitioners alternatively maintain that because
the IRS did not challenge the loss reflected on their 1994 tax
return, pursuant to the doctrine of equitable estoppel, the IRS
cannot now argue that for tax year 1995, Legal Search is not an S
corporation. We disagree.
Page: Previous 1 2 3 4 5 6 7 Next
Last modified: May 25, 2011