A New York State Administrative Law Judge has held that an action brought by Infusiondev Corporation to challenge alleged overpayment of withholding tax on behalf of its employees was time-barred. Matter of Infusiondev Corporation, DTA No. 825737 (N.Y.S. Div. of Tax App., May 1, 2014).

In April 2009, Infusiondev filed amended quarterly withholding tax returns seeking a refund of withholding tax that it allegedly overpaid.  The request was denied by a letter dated June 3, 2009, additional information was submitted, and the refund was again denied in a letter dated October 23, 2009, which also advised that a request for a conciliation conference with the Bureau of Conciliation and Mediation Services (“BCMS”) or a petition for a hearing before the Division of Tax Appeals had to be filed within two years. A request for a BCMS conference was filed, dated March 21, 2013, with a postage meter stamp bearing the same date.  It was received by BCMS on May 9, 2013, and BCMS issued an Order on May 24, 2013 dismissing the request as untimely since it was not filed within two years of October 23, 2009, the date of the denial of the claim for refund.

Infusiondev then filed a petition with the Division of Tax Appeals, challenging the denial of its request for a conciliation conference. The petition was mailed using the U.S. Postal Service on June 26, 2013 and received on June 28, 2013.

Timeliness issues: The ALJ dealt first with the issue of whether the Division of Tax Appeals lacked jurisdiction to hear the matter, since the Department had argued that the petition was untimely because it was filed more than 90 days after the notice of refund denial. This argument was quickly rejected, since Infusiondev challenged the refund denial not by going directly to the Division of Tax Appeals, but by filing a request with BCMS. Infusiondev then timely filed a petition challenging the BCMS Order, since the petition was filed well within the 90-day period for challenging an order from BCMS. Tax Law § 170[3-a][e].

However, notwithstanding the timeliness of the petition, on the question of the timeliness of the original request to BCMS, the ALJ found that the request was untimely, since it had been filed more than two years after the refund denial. Because the request to BCMS filed by Infusiondev bore only a private postage meter stamp of March 21, 2013, the date on which the petition was received – May 9, 2013 – is the governing date, and the postage meter date is disregarded. Since the BCMS request was not received until three and a half years after the notice of denial of refund, the Conciliation Order dismissing it as untimely was upheld.

Additional Insights

While the ALJ’s opinion focused on the method of mailing, in this case the mailing method was not actually determinative because even the postage meter date was well after the two- year period for protesting a refund denial.  Nevertheless, the case highlights the importance of carefully following New  York’s rules on methods of mailing jurisdictional documents. While New York generally follows the “timely mailing is timely filing” rule, the rule’s application depends on how the document is mailed.  If a document is sent by United States Postal Service – whether to BCMS or to the Division of Tax Appeals -- it will be considered timely mailed if the USPS postmark is within the statutory period, but the sender runs the risk of having an illegible postmark, or one that cannot be established.  If the document is sent by registered mail, the date of the registration governs, and if it is sent by certified mail and the receipt is postmarked by the post office, the date of the postmark governs.  The Department has also designated certain private delivery services, and certain specific delivery services they offer, identified in the Department’s Publication 55, as having records that will be accepted as evidence of timely mailing. Publication 55 is updated from time to time, most recently in December 2013, and it is important to check the current version, since the designation of approved delivery services can change.