The coronavirus pandemic has forced the IRS to temporarily suspend processing of mailed tax documents at many of its campuses and office locations. The IRS recently communicated plans to its employees for a phased re-opening that is expected to begin June 1. It will take time for the IRS to restore full operations, and presently the IRS remains unable to process many types of paper tax returns and correspondence, including all individual paper tax returns. The situation forced the IRS to store unprocessed mail in trailers, yet many tax returns are still due July 15, 2020. The predicament makes it more important than ever to ensure that there is proof of timely mailing. But if no one is available to sign for the delivery, how is this accomplished?
USPS Registered or Certified Mail
The most common way to obtain proof of mailing for paper forms sent to the IRS is via United States registered or certified mail. Section 7502(c) of the Code establishes that the postmark date on the mailing receipt for these United States Postal Service (USPS) options will serve as evidence of the mailing date. However with either of these options, Section 508.1.1.7 of the USPS Domestic Mail Manual specifies that the “mailpiece may not be opened or given to the recipient before the recipient signs . . . the applicable form or label and returns the form or label to the USPS employee.” The USPS offers an electronic signature service which alleviates the need for a physical signature, but Sections 188.8.131.52.1 and 184.108.40.206.4.8 of the IRS Internal Revenue Manual indicate that the IRS must sign and physically stamp the mail label. Hence, it is possible that the item could be returned as undeliverable when there is no one present to sign or date stamp the item. In practice, the USPS mail carrier might bypass the signature requirement, but this is at the discretion of the carrier and leaves open the possibility that the item will be returned.
USPS certified mail is offered with or without a “return receipt” option to the sender. However, omitting the return receipt option does not remove the recipient’s signature requirement. It merely means that the sender will not receive physical confirmation that the item was delivered. The return receipt is unnecessary under the Section 7502(c) proof of mailing standard; the sender needs proof that an item was mailed, but does not need proof that it was received. Thus, the possibility remains that the item could be returned for lack of a signature, even if the sender does not request a return receipt.
There is another service that the USPS mistakenly touts on its own website as providing adequate proof of mailing for tax documents. The USPS suggests a “certificate of mailing” for this purpose, which does not require signature. Although a certificate of mailing seemingly could alleviate the signature problem, the USPS unfortunately is mistaken about the availability of this service for Section 7502 proof of mailing purposes. The tax court addressed this issue specifically in Haaland v. Comm’r, T.C. Memo 1984-335. The IRS also addressed this issue previously in SCA 1998-051 (12/4/1998). In short, a certificate of mailing does not constitute valid proof of timely mailing.
The only USPS options that provide acceptable proof of mailing evidence for tax documents is registered or certified mail, each of which require signature by the recipient. Fortunately, there are other options that can be used to obtain proof of mailing.
Private Delivery Services
A less common but acceptable way to obtain proof of mailing for tax documents may now be the most reliable option, at least until the IRS is able to return to normal operations. Section 7502(f) adds IRS-specified private delivery services (PDS) to the list of acceptable means to obtain proof of mailing, and the IRS provided in Notice 2016-30 that many DHL Express, FedEx, and UPS options will meet the standard. It is very important to use one of the specific options that the IRS listed for these PDSs; other options that may be available from any of these PDSs will not qualify.
Currently, these PDSs are the most reliable, albeit more costly, option to mail tax documents with the appropriate proof of timely mailing. Unlike the USPS registered or certified mail options, the PDS options can be arranged without the recipient’s signature. Hence, these PDS options should be used with instructions to leave the item without the recipient’s signature any time proof of mailing is needed and there is a concern about the recipient’s ability to sign, as noted above.
The coronavirus pandemic continues to challenge every-day thinking and ways to accomplish formerly routine tasks. Proof of mailing evidence for paper-filed tax returns and correspondence is one example, and fortunately there are other PDS options available. Until the IRS is able to return to normal operations, it is more important than ever to obtain proof of mailing for paper-filed tax returns and correspondence. Currently, the most reliable way to do this is through PDS options. For more information about proof of mailing options, please contact your local CBIZ tax professional. You may also visit our COVID-19 Resource Center for up-to-date information on how the coronavirus may affect your organization.
Published on May 28, 2020