The perils of filing state tax returns and protests of tax assessments on the last day for filing are highlighted by a recent Final Order Dismissing Appeal of the Alabama Tax Tribunal (the “Tribunal”). The Tribunal ruled that the taxpayer’s protest of an income tax assessment was a day late, did not qualify for the State “mailbox rule,” and therefore the Tribunal did not have jurisdiction to hear the case. Tokrica S. Mack v. Alabama Dep’t of Rev., Docket No. 25-0309-RC (Ala. Tax Trib., Mar. 26, 2026).
The Facts: Under Alabama law, a taxpayer has 30 days from the date of mailing of a final assessment notice to file an appeal with the Tribunal. On April 15, 2025, the Department of Revenue (the “Department”) mailed a final assessment to the taxpayer, which gave her until May 15, 2025, to file her appeal.
On May 15, 2025, the taxpayer sent her appeal to the Tribunal by United Parcel Service (“UPS”). The package was delivered to the Tribunal the next day, May 16, 2025. The Tribunal noted that it was “an absolute certainty that the Taxpayer sent her package on or before May 15, 2025.”
Under the Alabama “mailbox rule,” where a tax return or other document required to be filed by a prescribed date is delivered to the state agency after that date, the U.S. Postal Service “postmark date is considered the date of delivery.” The rule also applies to “postmarks” made by other designated delivery services approved by the Internal Revenue Service (“IRS”). In the case of UPS, there are seven designated delivery services that qualify for the federal income tax mailing rules set out in IRC § 7502, such as “UPS Next Day Air” and “UPS 2nd Day Air.” However, those seven are the only UPS delivery services designated by the IRS (there are similar lists of approved FedEx and DHL services). In this case, however, the taxpayer used “UPS Ground,” which is not one of the designated delivery services.
The Decision. The Tribunal held that while there was no dispute that the taxpayer sent her appeal to the Tribunal on May 15, 2025, the fact that she used UPS Ground and that the package arrived at the Tribunal on May 16, 2025, meant it was filed one day late. The Tribunal reluctantly held that Alabama law gave it no jurisdiction to hear the case.
The Tribunal concluded that under the law and regulations, the timeliness of the taxpayer’s appeal depended entirely on which of the several UPS delivery services was used. Noting that it was “inconceivable” that any taxpayer would be aware of the consequential distinction between the various delivery services offered by UPS (or by FedEx or DHL), the judge concluded:
“This result is absurd. If there was a way to rule otherwise in accordance with the law as written, I would gladly take it. As it stands, this absurd result is the one that the statutes and regulations require. The Tribunal has no choice but to apply the law exactly as written.”
Notwithstanding this result, pursuant to its authority under Alabama law, the Tribunal referred the matter to the Department’s Taxpayer Advocate for equitable consideration, with these words:
“I have practiced in the area of state and local tax law for 25 years and served as a litigator for the Department for a dozen of those and this is the first time I had heard of this incredibly fine distinction. That does not mean, of course, that the rule is ineffective or somehow invalid; but I hope that it is a factor that the Taxpayer Advocate might take into consideration.”
Observation: Although the Tribunal was sympathetic to the taxpayer’s plight of being deprived of the ability to contest a tax assessment on such technical grounds, it ultimately concluded it had no choice. The decision is a stark reminder that whenever possible, tax returns and protest documents should be filed sufficiently in advance of the statutory deadline to ensure timely receipt. Of course, that is not always possible, but it is critical when using a private delivery company on the last day for filing that filing via the delivery service selected will qualify as timely under the state’s mailing rules.
