Citation Numbers: 3 Or. Tax 242
Judges: Howell
Filed Date: 7/12/1968
Status: Precedential
Modified Date: 11/13/2024
Decision rendered for plaintiff July 12, 1968.
The only issue presented in this appeal is whether the notice of deficiency and proposed income tax assessment for 1963 which was sent by defendant to the plaintiffs' accountant was proper notice under ORS
Generally ORS
Subsection (7) of ORS
The defendant contends that mailing the notice of proposed deficiency assessment to plaintiffs' accountant is sufficient compliance with ORS
Prior to March 24, 1967, the commission's auditor in Eugene had been conducting an audit of plaintiffs' tax returns for 1963, 1964 and 1965. (Plaintiffs' returns *Page 244 for 1964 and 1965, however, are not directly involved in this case.) The auditor wrote to plaintiffs at their address at 1705 Fairmont Boulevard in Eugene and requested certain information. The request was answered by a certified public accountant who advised the auditor that his firm was representing the plaintiffs. Various conferences followed between the auditor and the accountant, including one conference in Salem. On March 24, 1967, the tax commission issued a notice of proposed deficiency and assessment for 1963 and addressed it to:
Donald and Sylvia Furtick c/o Charles Larson, Certified Public Accountant 261 East 12th Avenue Eugene, Oregon 97401
On April 25, 1967, the commission issued notices of deficiency and proposed assessments for 1964 and 1965 and addressed them to Donald R. and Sylvia Furtick, 1705 Fairmont Boulevard, Eugene, Oregon.
The plaintiffs' accountant, Charles Larson, testified that he had not been given any power of attorney by the plaintiffs, that he could not recall whether or not he called plaintiffs and advised them he had received the notice of proposed deficiency dated March 24, 1967, or whether he placed it in his file until after April 15, and that he did not have any authority to commit the plaintiffs to payment of any deficiencies.
The auditor who represented the commission in the audit of plaintiffs' returns for 1963 through 1965 testified to the various conferences he conducted with plaintiffs' accountant. He also stated that in the majority of cases he mailed the notice of proposed deficiency directly to the taxpayers although all preliminary negotiations and conferences had been conducted with the taxpayers' accountant. *Page 245
1. The commission auditor did not comply with ORS
2. Neither is the commission entitled to rely on ORS
As it is agreed that plaintiffs did not file any written authorization appointing Larson as their agent, it is necessary that the auditor be satisfied that Larson had actual authority to represent plaintiffs even to the extent of receiving the notice of deficiency assessment for them. Apparently the auditor was not satisfied as to Larson's authority to do so or he would not have sent the 1964 and 1965 notices directly to the plaintiffs instead of their accountant. Moreover, the auditor's testimony that in most cases the notice of deficiency is sent directly to the taxpayer even though he has been represented throughout the conferences *Page 246
by an accountant would indicate that the commission does not place total reliance on ORS
The notice of the deficiency and proposed assessment was insufficient for the reasons mentioned. The order of the commission is set aside.
*Page 247"Recognizing representative of taxpayer. No attorney, accountant or agent shall be recognized as representing any taxpayer in regard to any claim, appeal or other matter relating to the tax liability of such taxpayer in any hearing before, or conference with, the commission, or any member or agent thereof, unless there is first filed with the commission a written authorization or unless it appears to the satisfaction of the commission, or member or agent thereof, that the attorney, accountant or agent does in fact have authority to represent the taxpayer."