US v. Burdett, No. CR 91-00340.

• Court: United States District Courts. 2nd Circuit. United States District Court (Eastern District of New York)
• Citation: 768 F. Supp. 409
• Docket Number: No. CR 91-00340.
• Parties: UNITED STATES of America, Plaintiff, v. Warren J. BURDETT, Defendant.
• Decision Date: 30 July 1991

768 F. Supp. 409

UNITED STATES of America, Plaintiff, v. Warren J. BURDETT, Defendant.

No. CR 91-00340.

United States District Court, E.D. New York.

July 30, 1991.

Andrew J. Maloney, U.S. Atty. by Douglas S. Burns, Asst. U.S. Atty., Garden City, N.Y., for plaintiff.

Larry M. Lopez, Denver, Colo., for defendant.

WEXLER, District Judge.

MEMORANDUM AND ORDER

Defendant Warren J. Burdett ("defendant" or "Burdett") moves to dismiss the counts of his indictment which charge him with knowingly and willfully attempting to evade income taxes, pursuant to 26 U.S.C. § 7203, owed for the years 1984 and 1985. Burdett alleges that the Internal Revenue Service ("IRS") failed to comply with the Paperwork Reduction Act of 1980 ("PRA" or "the Act"), 44 U.S.C. § 3501, et seq., by not displaying Office of Management and Budget ("OMB") control numbers or expiration dates on its Form 1040 instruction booklet and implementing regulations. For the reasons set forth below, this Court finds defendant's contentions to be without merit.

The PRA

The PRA was designed "to reduce and minimize the burden Government paperwork imposes on the public." S.Rep. No. 930, 96th Cong., 2d Sess. 2, reprinted in 1980 U.S.Code Cong. & Admin. News 6241, 6242 hereinafter S.Rep. No. 930. As codified at 44 U.S.C. § 3501, the purposes of the Act are:

(1) to minimize the Federal paperwork burden for individuals, small businesses, State and local governments, and other persons;

(2) to minimize the cost to the Federal Government of collecting, maintaining, using, and disseminating information;

(3) to maximize the usefulness of information collected, maintained, and disseminated by the Federal Government;

(4) to coordinate, integrate and, to the extent practicable and appropriate, make uniform Federal information policies and practices;

(5) to ensure that automatic data processing, telecommunications, and other information technologies are acquired and used by the Federal Government in a manner which improves service delivery and program management, increases productivity, improves the quality of decisionmaking, reduces waste and fraud, and wherever practicable and appropriate, reduces the information processing burden for the Federal Government and for persons who provide information to and for the Federal Government; and

(6) to ensure that the collection, maintenance, use and dissemination of information by the Federal Government is consistent with applicable laws relating to confidentiality, including section 552a of title 5, United States Code, known as the Privacy Act.

44 U.S.C. § 3501; see, generally, Dole v. United Steelworkers, 494 U.S. 26, 110 S.Ct. 929, 108 L.Ed.2d 23 (1990).

Under the Act, a federal agency must submit to the Director of the OMB any "written report form, application form, schedule, questionnaire, reporting or recordkeeping requirement, collection of information requirement or other similar method calling for the collection of information from the public." 44 U.S.C. §§ 3502(11), 3507. These forms and requirements are known throughout the Act as "information collection requests." The Director of the OMB must approve or reject the agency's proposed information collection request within sixty days of receiving it.¹ Id. at § 3507(b). If the Director approves the request, he must assign it a control number. Id. at § 3504. An agency may not engage in the collection of information unless the Director has assigned a control number to the appropriate form.² Id. at § 3507(f). This number must be displayed in the upper right hand corner of the front page of the form. Id.; see also 5 C.F.R. § 1320.7(e)(1).

Federal income tax forms were among the many paperwork burdens imposed on the public which the PRA was created to alleviate. S.Rep. No. 930 at 2; see also, Dole v. United Steelworkers, 494 U.S. 26, 110 S.Ct. 929, 108 L.Ed.2d 23 (1990); United States v. Collins, 920 F.2d 619, 630 (10th Cir.1990), cert. denied, ___ U.S. ___, 111 S.Ct. 2022, 114 L.Ed.2d 108 (1991). Accordingly, in 1981, the Treasury Department submitted approximately 700 IRS forms to the OMB for approval and assignment of control numbers. Alexander, Review of Tax Regulations and Rulings by The Office of Management and Budget (by the Committee on Tax Policy of the New York State Bar Association Tax Section), Tax Notes October 3, 1983 at 6. It is to be noted that in the case at bar, the tax return forms that Burdett failed to file — the IRS's 1040 forms for 1984 and 1985 — displayed OMB numbers as required by the Act.

Defendant argues that the Internal Revenue Service failed to comply with the Paperwork Reduction Act in that the IRS Form 1040 instruction booklets and implementing regulations do not display OMB control numbers and expiration dates. In particular, he cites the "public protection" provision of the PRA and United States v. Smith, 866 F.2d 1092 (9th Cir.1989), in support of the theory that noncompliance by a federal agency with the PRA precludes the government from imposing civil or criminal penalties on persons who fail to answer information collection requests. The "public protection" provision of the PRA, 44 U.S.C. § 3512, states:

Notwithstanding any other provision of law, no person shall be subject to any penalty for failing to maintain or provide information to any agency if the information collection request involved was made after December 31, 1981, and does not display a current control number assigned by the Director, or fails to state that such request is not subject to this chapter.

In Smith, 866 F.2d 1092, the appellants challenged their convictions for residing and working on an unpatented mining claim without having filed a Plan of Operations with the United States Forest Service, in violation of 36 C.F.R. § 228.4. They argued that the Alaska Placer Mining Application Form, which the Forest Service would have accepted as a Plan of Operations, was an information collection request which did not satisfy the PRA because it lacked a current control number. The Ninth Circuit agreed with the appellants and reversed the convictions.³ The court held that "PRA section 3512 by its terms prohibits the imposition of `any penalty' against the appellants, including criminal convictions, for their failure to comply with the Plan of Operations filing requirement." Id. at 1099.

The public protection provision was designed to create an incentive for federal agencies and the OMB to comply with the requirements of the PRA. See Funk, The Paperwork Reduction Act: Paperwork Reduction Meets Administrative Law, 24 Harv.J. on Legis. 1, 70-78 (1987). This section encourages the public to ignore information collection requests which do not display current control numbers. Persons who receive information collection requests which do not conform with the Act may consider the requests as "bootleg" and avoid penalty. S.Rep. No. 930 at 52.

The PRA and the Case at Bar

However, Congress did not intend the IRS regulations and instruction booklets to be information collection requests within the meaning of the PRA. Brewer v. United States, 764 F.Supp. 309 (S.D.N.Y.1991); United States v. Crocker, 753 F.Supp. 1209, 1216 (D.Del.1991) ("1040 form instruction booklets are not themselves `information collection requests' that must display OMB control numbers"); United States v. Stiner, 765 F.Supp. 663 (D.Kan.1991) (instruction booklets do not constitute information collection requests under 44 U.S.C. § 3502(11)); United States v. Karlin, 762 F.Supp. 911, 913 (D.Kan. 1991). ("instruction booklets are not covered by the PRA's requirements"). The Senate Report described an "information collection request" as "the actual instrument used for a collection of information." S.Rep. No. 930 at 39. Thus, in the Court's view, materials which the government provides to assist taxpayers with the completion of tax forms are not information collection requests. Likewise, regulations such as those of the IRS which are not classified as "collection of information requirements" under section 3502(11) are not required to comply with the PRA. Therefore, the PRA does not require the IRS to display OMB control numbers or expiration dates on the regulations or instruction booklets.

Burdett also asserts that the public protection provision mandates that he may not be penalized for failing to file his tax returns since the 1040 Forms do not display an OMB expiration date. Although the public protection provision requires control numbers on information collection requests to be "current," there is no explicit requirement in the PRA that forms must display an expiration date. See United States v. Collins, 920 F.2d at 631. On the contrary, one of the functions of the Director of the OMB is to insure that all information collection requests "are inventoried, display a control number, and when appropriate, an expiration date." 44 U.S.C. § 3504(c)(3)(A) (emphasis supplied). Each 1040 Form contains the year of its effective coverage, United States v. Collins, 920 F.2d at 631, and an expiration date on the form may confuse taxpayers.⁴See also United States v. Pottorf, No. 91-20017-01, ___ F.Supp. ___ 1991 WL 119997 (D.Kan. June 26, 1991). Accordingly, the 1040 Forms do not need expiration dates to notify the public that they are "current" within the meaning of the public protection provision.

In the relatively brief history of the PRA, the Second Circuit has faced very few cases in which an appellant has used the Act as an affirmative defense. In United States v. Weiss, 914 F.2d 1514 (2d Cir.1990), cert. denied sub nom., Gleicher v. United States, ___ U.S. ___, 111 S.Ct. 2888, 115 L.Ed.2d 1053 (1991), the appellants challenged their convictions for mail fraud, mail fraud conspiracy, and making false representations of material facts on Medicare and Medicaid claims. The appellants asserted that the government failed to comply with the Act by not displaying an OMB control number on Form 1500, the official form...