Josephine C. Toscano AKA Josephine C. Zelasko v. Commissioner of Internal Revenue

This case presents two questions:

1. Did the Tax Court have jurisdiction, after its decision had become final under 26 U.S.C. § 7481 , to grant leave to *931 file a motion to vacate its decision on the ground of fraud on the court ?

2. If the Tax Court had such jurisdiction, should it have granted leave and afforded the taxpayer an evidentiary hearing in this case? We answer both questions in the affirmative and remand to the Tax Court for further proceedings.

The question arises in this way. One John J. Toscano, with whom petitioner Josephine C. Zelasko was then living, but to whom she claims that she was never married, filed joint income tax returns for the two of them, as husband and wife, for the years 1946 through 1950. The Commissioner assessed deficiencies. A joint petition was filed with the Tax Court, and a settlement stipulation was filed with that court, on the basis of which deficiencies were determined for 1947, 1949, and 1950. Decision was entered March 28, 1955. It became final three months later ( 26 U.S.C. § 7483 ), no petition for review having been filed ( 26 U.S.C. § 7481 ).

Miss Zelasko alleges, and has submitted considerable documentary evidence to…

I respectfully dissent.

This case presents a graphic illustration of how litigants in their efforts to avoid the finality of judgments, contribute to the log jam in our courts resulting from repetitious hearings.

On July 15, 1953, the Commissioner of Internal Revenue determined deficiencies in the income taxes of John J. Toscano and Josephine Toscano as husband and wife. This determination was reached after reviewing the Toscanos’ joint returns for the years 1946 through 1950. John and Josephine Toscano jointly petitioned the Tax Court for a redetermination of the said deficiencies.

On March 21, 1955, John and Josephine, through their attorney, Franklin C. Laven, filed a settlement stipulation with the Tax Court. The petitioners stipulated to deficiencies and additions for the years 1947, 1949 and 1950; the years 1946 and 1948 were deemed to be free of such deficiencies. The Tax Court entered a decision pursuant to the stipulation.

After John Toscano’s death in July, 1962, the Commissioner sought to collect from Josephine. This Court, in 1965, rejected the contention of Josephine and her wholly owned corporation, that the Commissioner should be enjoined from making such…

441 F.2d 930 24 A.L.R.Fed. 683, 71-1 USTC P 9382 Josephine C. TOSCANO aka Josephine C. Zelasko, Petitioner-Appellant, v. COMMISSIONER OF INTERNAL REVENUE, Respondent-Appellee. No. 24595. United States Court of Appeals, Ninth Circuit. April 28, 1971. George H. Zeutzius (argued), Pasadena, Cal., for petitioner-appellant. Grant W. Wiprud (argued), Lee A. Jackson, Elmer J. Kelsey, Issie L. Jenkins, Attys., Johnnie M. Walters, Asst. Atty. Gen., Tax Div., K. Martin Worthy, Chief Counsel, I.R.S., Washington, D.C., respondent-appellee. Before CHAMBERS and DUNIWAY, Circuit Judges, and BYRNE, District judge. * DUNIWAY, Circuit Judge: This case presents two question: 1 1. Did the Tax Court have jurisdiction, after its decision had become final under 26 U.S.C 7481, to grant leave to file a motion to vacate its decision on the ground of fraud on the court? 2 2. If the Tax Court had such jurisdiction, should it have granted leave and afforded the taxpayer an evidentiary hearing in this case? We answer both questions in the affirmative and remand to the Tax Court for further proceedings. 3 The question arises in this way. One John J. Toscano, with whom petitioner Josephine D. Zelasko was then…