Scardina v. Commissioner
| Decision Date | 14 January 1988 |
| Docket Number | Docket No. 26778-84. |
| Citation | 1988 TC Memo 20,54 TCM(CCH) 1544 |
| Parties | Theodore J. Scardina, as Possessor of Certain Cash v. Commissioner. |
| Court | U.S. Tax Court |
Stanley P. Gimbel, 2301 W. Sample Rd., Pompano Beach, Fla., for the petitioner. Andrew A. Vanore III, for the repondent.
Memorandum Findings of Fact and Opinion
The Commissioner determined that petitioner, an artificial entity, the "possessor of certain cash," created by operation of section 6867, I.R.C. 1954, had a deficiency in Federal income tax in the amount of $26,500 for the taxable year ending December 31, 1983. The primary issue before us is whether petitioner is liable for the deficiency under section 6867, I.R.C. 1954. For convenience, our findings of fact and opinion are combined.
Some of the facts have been stipulated. The stipulation of facts and related exhibits are incorporated herein by this reference. Theodore J. Scardina (Scardina) is a resident of Ft. Lauderdale, Florida.
On the evening of September 9, 1983, Scardina went to Logan International Airport (Logan Airport or the airport) in Boston, Massachusetts, and attempted to board a Delta Airlines flight to Ft. Lauderdale, Florida. At the security checkpoint for passengers departing on Delta Airlines, he placed a soft, blue suitcase on the conveyor belt leading to the X-ray machine. On examination of the bag under X-ray, the security guard manning the X-ray machine became suspicious that the bag contained a large amount of cash. The guard brought the bag to the attention of a Massachusetts state trooper who was present at the security checkpoint. That state trooper questioned Scardina about the bag and its contents, and then called other state troopers, who were patrolling the airport, to the security checkpoint. Two troopers arrived at the checkpoint, questioned Scardina, and then brought him to the state police office located at the airport. They then called for John J. Kelley (Kelley or Detective Kelley), the police detective then on duty at Logan Airport.1
At the time of trial, Detective Kelley had been a Massachusetts State Trooper for 15 years. In 1983, he was stationed at Logan International Airport in Boston. As a detective at the airport, Kelley's duties were to investigate crimes occurring in or around the airport. In fulfilling these duties, Kelley would often cooperate with Federal authorities such as the Customs Service, the Drug Enforcement Agency, the FBI, the Federal Aviation Administration, and the Coast Guard.
By the time Detective Kelley arrived at the police office, the troopers had opened the bag Scardina was carrying and had found it to be filled with money. The troopers explained to Kelley in the presence of Scardina that Scardina had attempted to put the bag through the X-ray machine at the security checkpoint for Delta Airlines, that they had determined the bag to be full of money, and that on questioning Scardina had denied that either the bag or the money belonged to him.
At that point, Kelley himself questioned Scardina. Scardina recounted to Kelley only the barest outline of the events that led up to his being stopped at Logan Airport. He told Kelley that while he was in Ft. Lauderdale, he was given a bus ticket to Boston, $200 in cash, and an airplane ticket back to Ft. Lauderdale. He was asked to travel to Boston, pick up a package there, and bring the package back to Ft. Lauderdale. He said he had left Ft. Lauderdale by bus on September 6, 1983 and arrived in Boston early on September 8th. During the next one and one half days in Boston, "he just goofed off." At some point while in Boston, he visited a Holiday Inn where he was given the soft, blue suitcase which he had been sent to pick up. He claimed that he did not remember at which Holiday Inn he picked up the suitcase or even where he spent the night before being stopped at the airport. On his return to Ft. Lauderdale, he was to put the bag in a locker at the Ft. Lauderdale airport.
Outside of these basic facts, Scardina's story was vague. He professed not to remember the details of the few days leading up to the airport incident. He could not tell Kelley on what bus line he traveled to Boston, what he did when he arrived in Boston, or where he stayed in Boston. Further, he claimed that he did not know the person for whom he was bringing the bag back to Florida. While Scardina admitted that he had been given the bag and had been carrying it to the security checkpoint, he was evasive when asked for details about how he received possession of the bag. Further, he claimed that he did not know the person who gave him the bag. He told Kelley that on his return to Ft. Lauderdale, he was supposed to put the bag in a locker at the Ft. Lauderdale airport, but he could not remember which locker he was to put it in.
After obtaining Scardina's consent, Kelley searched Scardina. In a purse that Scardina was carrying, Kelley found a receipt showing that Scardina had spent the previous night in the Sheraton Inn at La Guardia Airport in New York. In the same purse, he found a white envelope containing two hundred dollars and "an official document of the Hialeah Police Department questioning the criminal background of" a person with a Hispanic surname. Scardina was also carrying a leather garment bag, in which Kelley found a device used to detect police radar. Scardina gave inconsistent and evasive explanations of how he got to the hotel in New York the night before and how he planned to use the radar detector. He had previously told Kelley that he had come straight to Boston from Ft. Lauderdale by bus. When confronted with the hotel receipt, he said he had driven from Boston to New York with a friend the night before. When asked to describe the car in which they drove, he said they had taken a bus. Similarly, when Kelley questioned Scardina about the radar detector, Scardina responded that he had used it for the trip to Boston. When reminded that he had taken a bus, he said it was for the ride back to Ft. Lauderdale. When asked how it would be of help to him when he was flying back, his response was that he was bringing it back to Ft. Lauderdale for a friend. Scardina did acknowledge ownership of the $200 found in the purse. Kelley returned the $200 to Scardina and obtained a receipt therefor, signed by Scardina.
Kelley then counted the money discovered in the bag in the presence of Scardina and found there to be $53,000, in bundles of $1,000 each. Scardina again denied that the $53,000 belonged to him. Kelley seized the $53,000 and told Scardina that it would be turned over to the District Attorney pending further investigation. He provided Scardina with a receipt, signed by Kelley and the two other troopers involved, stating that the money was taken from him at Logan Airport. Scardina was not arrested and no criminal action was thereafter taken against him in connection with the $53,000.
On September 30, 1983, an assistant district attorney, acting for the Commonwealth of Massachusetts, petitioned the Superior Court for Suffolk County in a proceeding in rem to order forfeiture of $26,500 of the cash taken from Scardina. The petition took the form of a complaint against "TWENTY SIX THOUSAND FIVE HUNDRED DOLLARS IN U.S. CURRENCY," half of the $53,000 seized from Scardina. The complaint was based upon the allegations that the money was owned by Scardina, and that it "was intended to be used in the procurement, manufacturing, compounding, processing, delivery or distribution of a controlled substance, or that it constitutes the proceeds of a sale of a controlled substance" in violation of Massachusetts law. Also on September 30, 1983, the Commonwealth of Massachusetts requested that the court issue a preliminary order "authorizing the securing and holding of the above money pending the outcome of the forfeiture proceeding against the money." The request was made based, at least in part, on an affidavit prepared by Detective Kelley. On December 13, 1983, a default judgment was entered against the cash and it was forfeited to the Commonwealth of Massachusetts. The remaining $26,500 was turned over to the Internal Revenue Service in connection with the events set forth in the next paragraph herein.
Within a few days of the September 9 incident, Detective Kelley's supervisor and the Internal Revenue Service were in contact in connection with an IRS levy against the $53,000 seized. In accordance with sections 6851 and 6867, the IRS then sent Scardina, in his capacity as possessor of certain cash under section 6867, a "Notice of Termination Assessment of Income Tax." That notice stated that the IRS had "found that the collection of income tax for the period January 1, 1983 to September 13, 1983 is jeopardized or rendered ineffectual" because Scardina was found in possession of the $53,000 which he did not claim as belonging to himself or to an individual whose identity could be readily ascertained. As a result, $26,500 in income tax for the shortened 1983 year was determined, under the presumptions contained in section 6867(a) and (b), to be due and payable from the cash seized.
On April 26, 1984, as required under section 6851(b), the Commissioner sent Scardina, as possessor of certain cash, a notice of deficiency for the tax year ended December 31, 1983. In the notice, the Commissioner determined a deficiency of $26,500 based on Scardina's possession of $53,000 which "you did not claim as yours or belonging to another person whose identity the Secretary can readily ascertain and who acknowledges ownership of such cash." The deficiency was determined to be payable from the cash found in Scardina's possession. The notice informed Scardina that the determination therein "is independent of and has no effect upon your personal income tax liability for the calendar year 1983." It used a taxpayer identification number different from Scardina's individual social...
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