-7-
itself. This Court has applied the doctrine of substantial
compliance to excuse taxpayers from strict compliance with
procedural regulatory requirements such as the manner in which an
election must be made. See Estate of Chamberlain v.
Commissioner, T.C. Memo. 1999-181 (and cases cited therein),
affd. 9 Fed. Appx. 713 (9th Cir. 2001). Other Federal courts
also have applied the doctrine in the setting of regulatory
requirements. See id.
Although neither party has argued that the substantial
compliance doctrine may also apply in the setting of a statutory
requirement, the Court of Appeals for the Ninth Circuit, the
court to which an appeal of this case lies, has indicated that
the doctrine may apply to “statutory prerequisites”. Sawyer v.
County of Sonoma, 719 F.2d 1001, 1008 (9th Cir. 1983). However,
the court stated:
in the context of statutory prerequisites, the doctrine
can be applied only where invocation thereof would not
defeat the policies of the underlying statutory
provisions. * * * In addition, the doctrine of
substantial compliance can have no application in the
context of a clear statutory prerequisite that is known
to the party seeking to apply the doctrine. [Id.]
Petitioner asserts that the choice of 60 days in the 60-day
rule was “arbitrary and procedural” and that the policy of the
statute is to promote the maintenance of funds in a retirement
account. Petitioner concludes that this policy is preserved in
this case, given that he has paid the $118,000 into the second
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