Nebraska – Three-Day Rule Did Not Apply to an Untimely Filed Petition for Redetermination

SALT Report 2288 – A Nebraska District Court issued a ruling regarding the 3 day mailing rule provided in Neb. Ct. R. Pldg. §6-1106(e) which extends the 60 day period within which a Petition for Redetermination must be filed by a taxpayer.

In this case, the Department conducted an audit of the Taxpayer’s books and records which indicated that over a 3 year period the Taxpayer had under reported its sales tax liabilities. The Department issued the Taxpayer a Notice of Deficiency Determination stating that the Taxpayer owed $247,545.94 in unpaid taxes, interest, and penalties. The Deficiency Notice was mailed on April 16, 2012 and received by the Taxpayer on April 17, 2012. On June 18, 2012 the Taxpayer mailed its protest petition to the Department, three days after the expiration of the 60-day period for requesting a redetermination. Because of this, the Department denied the Petition for Redetermination, which the Taxpayer is now appealing.

Upon review, the Court stated that the sole issue in this case was whether the 3 day rule applied to the Deficiency Notice sent to the Taxpayer on April 16, 2012. If so, then the Taxpayer’s June 18, 2012 Protest Petition was timely filed and the Department erred in finding otherwise. If not, then the Protest Petition was not timely filed and the determination of the Department is final as provided in Nebraska Revised Statute § 77-2709 (7).

The statute states that, “any person against whom a determination is made under subsection (1) and (2) of this section or any person directly interested may petition for a redetermination within sixty days after service upon the person of notice thereof… If a petition for redetermination is not filed within the sixty-day period, the determination becomes final at the expiration of the period.”

Based on the plain language of the statute, the Court determined that “service of a notice of deficiency determination is complete at the time of mailing and the person against whom the deficiency is made must file a petition seeking redetermination within 60 days. At 60 days the determination becomes final.”

Additionally, the Court referred to Nebraska Revised Statute §77-27,125, which states that the postmark date of a tax petition or protest is the date on which it is considered delivered to the Commissioner, even if the document arrives days later.

Based on the above, the Court found that the 3 day rule does not extend the 60-day period set forth in the Nebraska Revenue Act. Furthermore, the Court found that there is no language found within the Supreme Court rules or statutes regarding the 3 day rule to suggest that it applies to a Deficiency Notice issued by the Department. Therefore, the Court denied the Taxpayer’s petition for redetermination of its sales tax deficiency because it was not timely filed and the assessment was upheld.

For Further Information

Nebraska Department of Revenue – 3rd District Court, Case #CI12-3031