United States v. Trevitt
| Citation | 196 F.Supp.3d 1366 |
| Decision Date | 15 July 2016 |
| Docket Number | No. 5:13-CV-174 (CAR),5:13-CV-174 (CAR) |
| Parties | UNITED STATES of America, Plaintiff, v. Carmen D. TREVITT, Jr., Barbara B. Trevitt, Defendants. |
| Court | U.S. District Court — Middle District of Georgia |
Bruce T. Russell, United States Department of Justice, Washington, DC, for Plaintiff.
Neal Weinberg, Macon, GA, Charles Robert Melton, Forsyth, GA, for Defendants.
ORDER ON MOTION FOR SUMMARY JUDGMENT
Plaintiff United States of America (the "Government") filed the present action to reduce to judgment the federal income tax liabilities of Carmen and Barbara Trevitt (collectively, the "Trevitts") and to foreclose federal tax liens against certain real property. The parties have settled the foreclosure claim: the property has been sold to a third party, and the net proceeds have been paid to the Government.1 Now, remaining before the Court, are the Government's requests to reduce to judgment the income tax liabilities and penalties of Carmen Trevitt for 2002, 2004, 2005, and 2011, and the joint and several income tax liabilities of the Trevitts for 2003, 2006, and 2007.
This case is currently before the Court on the Government's Motion for Summary Judgment. The Trevitts were granted a Surreply, and the Government's Motion is now fully briefed and ripe for the Court to rule on. As set forth below, the Motion for Summary Judgment [Doc. 83] is GRANTED in part , and DENIED in part.
Under Rule 56 of the Federal Rules of Civil Procedure, summary judgment must be granted "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."2 A genuine issue of material fact only exists when "there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party."3 Thus, summary judgment must be granted if there is insufficient evidence for a reasonable jury to return a verdict for the nonmoving party or, in other words, if reasonable minds could not differ as to the verdict.4 When ruling on a motion for summary judgment, the Court must view the facts in the light most favorable to the party opposing the motion.5
The moving party "always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact" and that entitle it to a judgment as a matter of law.6 If the moving party discharges this burden, the burden then shifts to the nonmoving party to go beyond the pleadings and present specific evidence showing that there is a genuine issue of material fact.7 This evidence must consist of more than mere conclusory allegations or legal conclusions.8
It is undisputed the Trevitts failed to timely file federal income tax returns (Forms 1040) for all tax years from 2002 to 2007. Due to this failure, in 2007 the IRS began an investigation to determine the Trevitts' income and the amount of taxes they owed for each year.9 The examination lasted until early 2010, which was "due to the Trevitts nearly complete lack of cooperation, as well as the need to conduct a full examination of their many business interests," according to IRS's revenue agent, Pamela Caldwell.10 In May and July of 2010, the Trevitts signed separate waiver forms (Forms 870) with the IRS, agreeing to the amount of tax deficiencies stated in the Forms 870. The waivers also allowed the IRS to make an immediate assessment of the Trevitts' liabilities without first sending a notice of deficiency.11 However, shortly before the waivers were signed, the Trevitts filed delinquent Forms 1040, claiming "married filing jointly" status for the tax years 2003, 2006, and 2007.12 Revenue agent Caldwell did not receive these forms until after she completed the audit and assessed the Trevitts' tax liabilities separately based on the Forms 870.13 The IRS rejected the delinquent Forms 1040, claiming it was unable to determine the correct amount of liabilities from the submitted forms. Nonetheless, the IRS accepted the Trevitts' "married filing jointly" election and reassessed their income tax liabilities. Though the election is a tax benefit and reduced the Trevitts' total amount of tax liabilities, it also caused the Trevitts to be jointly and severally liable for the newly assessed 2003, 2006, and 2007 tax deficiencies.14
The IRS determined the Trevitts' newly assessed tax liabilities to be as follows:
[Editor's Note : The preceding image contains the reference for footnote15 ].
Because the Trevitts refused to agree to a "married filing jointly" election for the remaining years,16 the IRS determined Carmen Trevitts' individual tax liabilities to be as follows:
[Editor's Note : The preceding image contains the reference for footnote17 ].
To help dispute the IRS's assessment, the Trevitts hired an accountant to recalculate their income and tax liabilities. The accountant determined the following amounts represent the Trevitts' correct tax liabilities:
Trevitts' Income Tax Liabilities18
CPA's Tax Assessment
Tax Period (Principal Amount)
2004 $ 22,115.00
2005 $ 23,610.00
2006 $ 27,315.00
2007 $ 19,269.00
$ 92,309.00
[Editor's Note : The preceding image contains the reference for footnote18 ].
The Government now seeks to reduce to judgment the Trevitts' income tax liabilities. The Government claims the total balance for the Trevitts' joint and several tax assessment, plus accrued statutory additions, is $276,002.83, and the total balance for Carmen Trevitt's tax assessment, plus accrued statutory additions, is $411,116.54, as of September 30, 2015.19 The Government also seeks to reduce to judgment the tax penalties assessed against the Trevitts for 2005 and 2011 in the total amount of $6,465.63.20 The Trevitts do not contest the assessment for 2003,21 nor do they contest that they are responsible to the IRS for some amount of tax liabilities for the other years. Instead, the Trevitts claim the IRS's assessment for 2002 and 2004 through 2007 is invalid, and the amounts stated therein are incorrect; therefore, summary judgment is improper.
The Court will first discuss the parties' evidentiary requests and then turn to the validity of the IRS's tax assessment against the Trevitts.
In their Surreply, the...
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