Boudreau v. Dep't of Treasury (In re Boudreau)
| Decision Date | 09 August 2018 |
| Docket Number | BK No: 15-10162,A.P. No. 16-01001 |
| Citation | 587 B.R. 799 |
| Parties | IN RE: Jason D. BOUDREAU, Debtor Jason Boudreau, Plaintiff v. Department of Treasury, IRS, et al, Defendants |
| Court | U.S. Bankruptcy Court — District of Rhode Island |
Jason Boudreau, Central Falls, RI, pro se.
Kate Constance Brody, Department of the Attorney General, Bernard J. Lemos, State of RI-Taxation, Providence, RI, Mary Rogers, US Attorney's Office, Providence, RI, James M Strandjord, U.S. Department of Justice, Washington, DC, Brian J. Lamoureux, Pannone Lopes Devereaux & O'Gara LLC, Johnston, RI, for Defendants.
DECISION ON CROSS-MOTIONS FOR SUMMARY JUDGMENT
Debtor Jason Boudreau commenced this adversary proceeding against the Internal Revenue Service ("IRS") seeking a determination that his federal income taxes assessed for the years 2008, 2009, 2010, and 2011 are dischargeable.1 (For ease of reference, these tax years will be referred to collectively as the "Tax Years.") The parties filed cross-motions for summary judgment, and the Court heard oral argument on June 14, 2018 and took the motions under advisement. See IRS's Motion for Summary Judgment (Doc. # 249) and Mr. Boudreau's objection (Doc. # 268); Mr. Boudreau's Motion for Summary Judgment (Doc. # 267) and IRS's objection (Doc. # 270). The determination of the issue hinges entirely on the date Mr. Boudreau filed his tax returns for the Tax Years. While that date is disputed, the parties concur that under the unique circumstances presented, its resolution raises a purely legal issue: what is the evidentiary proof necessary to establish that filing date? Accordingly, the IRS and Mr. Boudreau agree this matter is ripe for adjudication by summary judgment.2
In support of their respective motions, Mr. Boudreau relies on an expansive application of the so-called prison mailbox rule, and the IRS relies on Internal Revenue Code § 7502. Alternatively, the IRS maintains that the prison mailbox rule is inapplicable to determine tax return filing dates, or at the very least, that case law requires a more circumscribed application of the rule. After careful consideration of the parties' arguments, the relevant statutes and regulations, and case law, the Court finds the IRS's motion meritorious.
The Court has jurisdiction over this matter under 28 U.S.C. §§ 157(a) and 1334, and DRI LR Gen 109(a). This is a core proceeding under 28 U.S.C. § 157(b)(2)(A), (B), (I), and (O).
Mr. Boudreau filed a voluntary petition under chapter 7 of the Bankruptcy Code on January 26, 2015, and received a discharge of his debts on April 21, 2015.3 The motions for summary judgment relate to Mr. Boudreau's surviving claims against the IRS as asserted in his second amended complaint. See Second Amended Complaint ("Complaint," Doc. # 98).4 Relevant to these remaining claims, the Complaint alleges that "no pre-petition assessment for unpaid taxes was assessed by the IRS for tax years 2008, 2009, 2010, and 2011," and that Mr. Boudreau "was incarcerated during 2012-2013, during which time [he] requested data from the IRS and filed his tax returns." Complaint at 2-3. The relief he seeks is: (i) "a full or partial discharge" of his federal income taxes for the Tax Years; (ii) a determination of when he filed his 2008, 2009, 2010 and 2011 income tax returns; and (iii) a determination of "whether any assessment for those tax years is time-barred."5 Complaint at 13.
The IRS counters that it has no record of the filing of tax returns for the Tax Years prior to January 2017, when it received returns from Mr. Boudreau, triggering the IRS's post-bankruptcy assessment of taxes due for the Tax Years. Mr. Boudreau maintains that the returns the IRS acknowledges receiving in early 2017 were actually duplicates of the returns he had previously filed that he re-created from records obtained from the IRS during this adversary proceeding. He asserts that he mailed them to the IRS only intending them to be "copies" of the returns allegedly filed in 2012.
Mr. Boudreau alleges that sometime in April 2012 he placed the returns for the Tax Years in a mailbox used by inmates at the Rhode Island Adult Correctional Institutions ("ACI"), where he was incarcerated, for mailing by prison officials through the United States postal system. He acknowledges that he did not send the returns by registered mail or certified mail, instead electing to use first class mail. He also did not request that prison officials create a prisoner mail log for him as a record of the mailing of the returns. At the hearing he stated that he did not use registered mail or request a prisoner mail log to be created because he did not give it much thought and did not consider it might be necessary. Mr. Boudreau has no copies of the returns allegedly mailed in 2012 and no copy of the postmarked envelope in which he states he placed them. He explained that subsequent to his release from the ACI he was evicted from his rented apartment and the landlord disposed of all of his belongings.
To rebut the IRS's summary judgment motion and in support of his own motion, Mr. Boudreau relies on his declaration attesting to the placement of the tax returns in the ACI mailbox in 2012. See Declaration of Jason Boudreau ("Declaration," Doc. # 267, Exh. 1). All of this boils down then to one dispositive question: is Mr. Boudreau's Declaration legally sufficient to defeat the IRS's motion and to entitle him to a judgment declaring he has no tax debts for the Tax Years?
" Federal Rule of Bankruptcy Procedure 7056 incorporates Federal Rule of Civil Procedure 56 as the mechanism for adjudicating summary judgment motions." Harrington v. Simmons (In re Simmons) , 810 F.3d 852, 857 (1st Cir. 2016). "The Court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a) ; see also Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). "[A]n issue is ‘genuine’ if the record permits a rational factfinder to resolve that issue in favor of either party ... [and] a fact is ‘material’ if its existence or nonexistence has the potential to change the outcome of the suit." Jarvis v. Vill. Gun Shop, Inc. , 805 F.3d 1, 7 (1st Cir. 2015) (internal citations and quotations omitted). Proving a genuine issue of material fact requires "significantly probative" assertions, Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986), going beyond "conclusory allegations, improbable inferences or unsupported speculation ...." Razzaboni v. Schifano (In re Schifano) , 378 F.3d 60, 66 (1st Cir. 2004).
While Bankruptcy Code § 727(a) generally grants a debtor a discharge of debts, § 523(a) "addresses the nondischargeability of certain types of debts, including three categories of tax debts that are excepted from discharge." Berry v. Mass. Dept. of Rev. (In re Berry) , No. 15-41218-CJP, 2016 WL 3676528, at *2 (Bankr. D. Mass. June 30, 2016) (citing 11 U.S.C § 523(a)(1)(A)-(C) ). "If the debt for such taxes meets the standard under § 523(a)(1)(A), (B) or (C), then the debt is nondischargeable." Nilsen v. Mass. Dept. of Rev. (In re Nilsen) , 542 B.R. 640, 643 (Bankr. D. Mass. 2015). The party seeking to establish an exception to discharge bears the burden of proof to show by the preponderance of the evidence that its claim falls "squarely within an exception to discharge." Comm. v. Richmond (In re Richmond) , 351 B.R. 6, 10 (Bankr. D.N.H. 2006) (citing Palmacci v. Umpierrez , 121 F.3d 781, 786 (1st Cir. 1997) ); see also In re Nilsen , 542 B.R. at 643 ; In re Ryan , 504 B.R. 686, 700 (Bankr. D. Mass. 2013).
The IRS asserts that Mr. Boudreau's tax debts for the Tax Years, assessed post-petition in 2017, are nondischargeable by virtue of § 523(a)(1)(A)"because they are of the kind specified under 11 U.S.C. § 507(a)(8) ‘not assessed before, but assessable, under applicable law or by agreement, after, the commencement of the case[.]’ " IRS's Motion for Summary Judgment at 3 (quoting § 507(a)(8) ). Mr. Boudreau concedes that if he cannot establish that he filed the returns in 2012, the IRS is correct and his tax liabilities are nondischargeable. On the other hand, if the Court determines the returns were filed in 2012, then Mr. Boudreau and the IRS agree that he would have no tax liability for those years because the IRS did not assess the taxes against him within three years of the filing of the returns. See 26 U.S.C. § 6501(a).6
The IRS argues that: (a) it has produced documentary evidence sufficient to establish that the tax returns were not filed in 2012; (b) as a matter of law, the exclusive methods for Mr. Boudreau to rebut that evidence and show that he filed the returns in 2012 are to produce direct proof of actual delivery of the returns to the IRS or of mailing of the returns by registered or certified mail; and (c) he has failed to provide any evidence of delivery of the returns by any of these methods.
Mr. Boudreau argues that: (a) the IRS's documentary evidence does not show that the tax returns were not actually received by the IRS in 2012; (b) he may establish that he filed the returns on the date alleged by use of the prison mailbox rule; and (c) his Declaration is sufficient as a matter of law to satisfy that rule. Challenging his arguments, the IRS maintains that even if the Court applies a "mailbox rule" to determine whether the returns were filed in 2012, Mr. Boudreau has not satisfied the evidentiary requirements of the rule. Therefore, as a matter of law the Court must find that the returns were not filed in 2012.
The Court finds that the IRS has met its initial burden and submitted documentary...
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