Helfrich v. Commissioner

Alma Helfrich, Petitioner, v. Commissioner of Internal Revenue, Respondent Helfrich v. Commissioner Docket No. 38038 United States Tax Court 25 T.C. 404; 1955 U.S. Tax Ct. LEXIS 33; December 7, 1955, Filed *33 Decision will be entered for the petitioner. 1. The notice of deficiency was sent by registered mail to petitioner and her former husband at their last known address. Accordingly, the requirements of section 272 (a) and (k), Internal Revenue Code of 1939, are satisfied. 2. Petitioner did not file a joint return with her husband in 1947, nor did she intend to file a joint return with him in that year. Robert Kratky, Esq., for the petitioner. Richard C. McLaughlin, Esq., for the respondent. Bruce, Judge. BRUCE *404 This proceeding involves a determination by the Commissioner of a deficiency and additions to tax in the joint and several income tax liability of petitioner Alma Helfrich and her former husband, Carl W. Helfrich, for the year 1947 in the following amounts: Addition to tax sec. 294 (d) Deficiency Addition to tax sec. 293 (b) (1) (A) $ 118,353.87 $ 59,176.94 $ 11,835.39 Respondent has made a jeopardy assessment of the deficiency and additions to tax. Although the statutory notice of deficiency was mailed to Carl W. Helfrich and Alma Helfrich, Carl W. Helfrich did not join in the petition filed with this Court. Petitioner, Alma Helfrich, *34 has contested the merits of respondent's determination and has also alleged that she is not a proper party to the proceeding. At the hearing this Court granted a joint motion of the parties to sever and try separately the following issues: (1) Whether the deficiency notice from which the appeal in this proceeding was taken satisfied the requirements of section 272 (a) and (k) of the Internal Revenue Code of 1939. (2) Whether petitioner filed with her husband a joint return for the year 1947. *405 (3) Whether petitioner's divorce from Carl W. Helfrich in November 1951 relieves her of liability for deficiencies in income tax and additions to tax for the year 1947. FINDINGS OF FACT. Petitioner is Alma Lucille Walton Helfrich. In 1947 she was the wife of Carl W. Helfrich whom she married in January of that year. They had previously been married for a period of approximately 2 months in 1946. A Federal income tax return for 1947 was filed in the names of "Carl & Alma Helfrich, First and Missouri Ave., East St. Louis, Illinois," with the collector of internal revenue for the first district of Illinois. The question on the return, "Is your wife (or husband) making a separate return*35 for 1947?" was answered "No." The return was signed "Carl W. Helfrich" and "Alma L. Helfrich." Petitioner did not file a separate income tax return for 1947. The signature appearing on the return and purporting to be that of petitioner is not hers. She did not authorize anyone to sign her name to the return; she did not authorize the filing of the return; participate in its preparation; or know that it had been filed. The first time she saw the return was at the office of the collector of internal revenue in East St. Louis, Illinois, in 1952. In the latter part of 1950 petitioner joined with Carl in the execution of a power of attorney authorizing their representation before the Treasury Department relating to Federal taxes for the year 1947 and in the execution of a consent, Form 872, extending the period for assessment of taxes for 1947 to June 30, 1952. The power of attorney did not authorize the Commissioner to send communications to Carl and Alma in care of their attorney. The address appearing on the consent was the same as that appearing on the return under review. In May 1946, during their first marriage, Carl and Alma acquired in both their names a 4-story apartment building*36 (hereinafter referred to as the apartment building) at No. 9 Topton Way, also known as 8209 Topton Way, Clayton, Missouri. The property was sold by them in September 1949. In 1947 they occupied one of the units in this building and rented the other three. Rent and deductions from this building were reported on the return filed in their names for the year 1947. In 1947 petitioner was a housewife. She had no trade or business of her own and she did not at any time know anything about Carl's business. She did not personally rent any of the units in the apartment building. Petitioner drew checks against a joint checking account which she had with Carl in the Mercantile-Commerce Bank *406 & Trust Co., St. Louis, Missouri, in payment of operating expenses of the apartment building and for personal expenses. In August 1951 Carl and Alma went to Mexico to live. At that time petitioner did not advise the Treasury Department of her change of address but she did leave a forwarding address for the post office. That address was 461 Columbia Place, East St. Louis, Illinois, the residence of her mother. In Juarez, Mexico, in November 1951, petitioner divorced Carl the second time (the*37 first having taken place around June 1946). Thereafter petitioner returned to the United States and lived with her mother from December 17, 1951, to January 1, 1952. Subsequently petitioner returned to Mexico and lived with Carl in Mexico City during the years 1952 and 1953. Upon her return to the United States in 1951 petitioner was served with a subpoena and her hotel room was sealed by revenue agents. She consulted an attorney who investigated and found that respondent had determined the deficiency here involved. The deficiency notice had been sent by registered mail on September 21, 1951, to Carl and Alma at First Street and Missouri Avenue, East St. Louis, Illinois, which is the address shown on the return here involved. Respondent's records did not show any address for petitioner and Carl different from that set forth in the notice of deficiency. The deficiency notice was returned to the internal revenue agent in charge in Springfield, Illinois, by the Post Office Department. Afterwards an officer of the Bureau of Internal Revenue conducted an unsuccessful personal investigation of the whereabouts of Carl and Alma. Upon learning of the deficiency determination petitioner*38 authorized the filing of the petition in these proceedings and this petition was filed on December 17, 1951, personally signed by her. The petition set forth facts, as indicated above, relating to the purported joint return, petitioner's second divorce from Carl, and expressly challenged the sufficiency of the deficiency notice on the ground that petitioner never received the notice or a copy thereof. The last known address of petitioner was First Street and Missouri Avenue, East St. Louis, Illinois. Petitioner did not file a joint return nor did she intend to file a joint return with Carl W. Helfrich for the year 1947. OPINION. The first question for decision is whether the notice of deficiency satisfies the requirements of section 272 (a) and (k), Internal Revenue Code of 1939. Petitioner contends that the deficiency notice was invalid because it was never received by her. The only address for petitioner and Carl Helfrich shown on the records of the office of the internal revenue *407 agent-in-charge at Springfield, Illinois, was that shown on the return filed in their names for the year 1947. At the time the deficiency notice was issued Alma and Carl were in Mexico. However, *39 the Commissioner had no notice of that fact. Therefore, we can only conclude that as there was but one address known to the Commissioner, it, of necessity, was the last known address and that the provisions of section 272 (a) and (k) were met by sending the deficiency notice by registered mail to that address. Gregory v. United States, (Ct. Cl., 1944) 57 F. Supp. 962, certiorari denied 326 U.S. 747. Moreover, in enacting section 272 (a), Congress was primarily concerned with giving the taxpayer notice within ample time to file a timely petition. When, as here, a timely petition was filed, it is obvious that sufficient notice was received. Cf. Clement Brzezinski, 23 T. C. 192. We must next consider whether petitioner and her former husband filed a joint return for the year 1947. The answer to this question depends upon the intent of the parties, which must be gleaned from the facts and circumstances surrounding the filing of the return. There is no doubt that the return on its face purports to be the joint return of Carl and Alma Helfrich. It was filed in their joint names. The question*40 as to whether the wife (or husband) is making a separate return is answered in the negative, and it bears signatures purporting to be those of Carl W. Helfrich and Alma L. Helfrich. We have found, however, and we hereby hold, that petitioner had no intention of filing a joint return and did not in fact file a joint return with Carl W. Helfrich for the year 1947. The signature "Alma L. Helfrich" on the return is not hers. Furthermore, she did not authorize anyone to sign her name to the return; she did not know the return had been filed; she did not participate in its preparation; and the first time she saw it was in the collector's office in East St. Louis in 1952. See Arlington F. Brown, 24 T. C. 256; Myrtle O. Calhoun, 23 T. C. 4. Moreover, we are unable to find that the execution with Carl of a power of attorney and consent relating to 1947 taxes is an admission that the return was intended to be a joint return. Such execution would appear to be a proper course of action for any taxpayer whose tax liability for a certain year is questioned by the Commissioner whether or not any return had been filed. In argument *41 both parties have assumed that petitioner and Carl were co-owners of the apartment building during the year 1947, and therefore petitioner was entitled to a portion of the income therefrom. Petitioner testified that she received no part of the rentals and that she was unaware that she was entitled to share in them. Assuming that in 1947 petitioner was entitled to some portion of the income from the apartment building by reason of co-ownership, we are unable to find without more that the inclusion of this income in the return is *408 indicative of an intent to file a joint return. Cf. McCord v. Granger, 201 F. 2d 103. Moreover, we have held under similar circumstances that while it was incumbent upon the taxpayer to report her share of income from the property so held, the taxpayer was free to select the method of reporting it. She could have filed either a separate or joint return. Therefore, as petitioner herein did not intend to and did not in fact file a joint return she incurs no joint and several liability based on a joint return. Respondent has not asserted that petitioner is liable for any deficiency by reason of unreported separate*42 income realized by her in the year 1947. Accordingly, the joint and several liability attributed to her in the deficiency notice is improper. Myrtle O. Calhoun, supra;Elsie S. Bour, 23 T. C. 237. By reason of our conclusions as to issues 1 and 2 it becomes unnecessary to consider issue 3. Decision will be entered for the petitioner.