Mailing Stuff from Abroad— Tax Traps for the Unwary
By Orlando Gotay
When dealing with tax matters, a critical issue is timely filing and paying whatever is required. When I was a kid, I remember going with my dad—and many others—to the post office late at night on April 15 for the coveted postmark. Did you know that the “regular” deadline for 2016 (2015 returns) is April 18? The two-month automatic extension for filers from abroad takes us to June 20.
A US postmark with a date on or before the due date makes the return timely filed or the payment timely made. What about a foreign postmark? What about private delivery services?
For tax returns and payments, the IRS considers as valid a foreign postmark that bears the date the item was mailed. There is a myth that the IRS has postmark reader machines. Truth is that the IRS conducts test mailings to its different centers. Mail arriving within the time windows is opened, envelopes are discarded, and the filings are treated as timely. Anything arriving afterwards will have the envelope attached to the return when processed, and a human will actually look at the postmark.
If you have mailed anything from Mexico, you know how speedy the post is. Count on needing that postmark to prove that the mailing was done by the date due. If you are close to a deadline, do not drop the item off in a mail slot. Take it to the counter and ask for the postmark to be placed right then and there. Mexico also offers “track and trace” (similar to USPS delivery confirmation).
When it comes to the US Tax Court, the benefit of postmark date as filing date is only for US postmarks. Foreign postmarks do not count and may put your Tax Court filing in grave danger of being untimely and dismissed outright. Get someone to mail your filing in the US or with enough time to make absolutely sure it is received by the Tax Court in time. Because Tax Court mail is irradiated (remember the anthrax scare?), that process adds risky time to a delivery.
You can also use specific private delivery services for both the IRS and Tax Court filings. The filings count as “timely filed” as of the date the item is with the delivery company. The IRS website specifies both company and type of service that qualify. Of note, only specific FedEx and UPS delivery types are designated. DHL is not on the list anymore.
When it comes to tax matters, timeliness is paramount. You bear the risk of losing if you don’t heed.
Orlando Gotay is a California-licensed tax attorney (with a Master of Laws in Taxation) admitted to practice before the IRS, the U.S. Tax Court, and other taxing agencies. His love of things Mexican has led him to devote part of his practice to the tax matters of US expats in Mexico. He can be reached at email@example.com.