Opinion
CASE NO. 1:02CV2446, Docket #23
October 29, 2003
MEMORANDUM OPINION
This case is before the magistrate judge on consent. Pending is the motion of plaintiff, the United States of America ("the government"), for summary judgment ("PI. mot."; Docket #23) against defendant, Tony Biondic ("Biondic"). Biondic has not opposed the government's motion. For the reasons given below the court grants the government's motion for summary judgment.
I.
The government alleges, and Biondic has admitted the following. In 1979 and 1980 Biondic filed false tax returns, understating his income by $195,791 in 1979 and by $187,405 in 1980. In 1986 Biondic pleaded guilty to one count of filing a false and fraudulent tax return and was sentenced to three years' probation and fined $10,000.
In 1993 Biondic filed for bankruptcy. In 1994 the bankruptcy court granted a motion for summary judgment in favor of the government, determining that Biondic's tax obligations to the government were not discheargeable in bankruptcy. Biondic unsuccessfully appealed the bankruptcy court's decision.
On September 2, 1994 the bankruptcy court confirmed Biondic's fourth plan for reorganization. Included in the plan was a requirement that Biondic pay $2,000 per month for six years to the Internal Revenue Service ("IRS") on its secured claim of $120,000. The plan also provided that Biondic would pay his remaining obligations to the IRS over eight years beginning in October 1994. If Biondic did not pay in full at the end of eight years, the IRS would be able to proceed with collecting the remainder of the debt.
Biondic filed a Form 900 Tax Collection Waiver with respect to his 1979 and 1980 tax years on July 14, 1997. This extended the collection statute through December 31, 2008. The Internal Revenue Restructuring and Reform Act of 1998, however, reduced this extension to December 31, 2002. The IRS is now able to proceed with collecting the remainder of Biondic's unpaid obligations.
The parties disagree as to the amount currently owed by Biondic. Biondic contends, in his Answer, that he has already paid the IRS $621,591.14 and that this was the amount of non-dischargeable tax debt allowed by the bankruptcy court. The government alleged in its Complaint that Biondic's unpaid balance of assessed and accrued tax and interest total $850,754 as of October 31, 2002 for his 1979 tax obligations and $828,823 as of December 9, 2002 for his 1980 tax obligations, plus interest and statutory additions from those dates. The government now moves for summary judgment on its claim and offers evidence that Biondic's unpaid tax liabilities as of September 30, 2003 are $1,208,873.
II.
Summary judgment is appropriate only when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317 (1986). The substantive law of the case identifies which facts are material. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The moving party must demonstrate to the court through reference to pleadings and discovery responses the absence of a genuine issue of material fact. Id. at 323. The nonmoving party must then show the existence of a material fact which must be tried. Id. at 324.
When evaluating a motion for summary judgment, "the inferences to be drawn from the underlying facts . . . must be viewed in the light most favorable to . . . the party opposing the motion" United States v. Diebold, Inc., 369 U.S. 654, 655 (1962); see also Roller v. Columbia Broad. Sys., Inc., 368 U.S. 464, 473 (1962); Aetna Ins. Co. v. Loveland Gas Elec. Co., 369 F.2d 648 (6th Cir. 1966). This includes taking the nonmoving party's uncontradicted allegations as true and giving the benefit of the doubt to the nonmoving party's assertions when they conflict with those of the movant. Bishop v. Wood, 426 U.S. 341 (1976); Bosely v. City of Euclid, 496 F.2d 193, 197 (6th Cir. 1974).
The court's treatment of facts and inferences in a light favorable to the nonmoving party does not relieve that party of its obligation "to go beyond the pleadings" to oppose an otherwise properly supported motion for summary judgment under Rule 56(e). See Celotex, 477 U.S. at 324. The nonmoving party may oppose a proper summary judgment motion "by any of the kinds of evidentiary material listed in Rule 56(c), except the mere pleadings themselves . . .," id., or by any other evidentiary material admissible at trial. Horta v. Sullivan, 4 F.3d 2, 8 (1st Cir. 1993); see also CHARLES ALAN WRIGHT ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE, 10A, § 2721 (1998). Conclusory allegations of an affidavit do not create specific fact disputes for summary judgment purposes. Lujan v. National Wildlife Fed'n, 497 U.S. 871 888-89 (1990). There must be enough evidence that a reasonable jury could find for the nonmoving party. Street v. J.C. Bradford Co., 886 F.2d 1472, 1477 (6th Cir. 1989).
III.
Title 26 U.S.C. § 6201 (a) authorizes the IRS to "make . . . assessments of all taxes . . . which have not been duly paid. . . . "Section 6203 provides that an assessment is made "by recording the liability of the taxpayer in the office of the Secretary in accordance with rules or regulations prescribed by the Secretary." 26 U.S.C. § 6203. Courts understand such an assessment to be "essentially a bookkeeping notation . . . made when the Secretary or his delegate establishes an account against the taxpayer on the tax roles." Laing v. United States, 423 U.S. 161, 170 n. 13 (1976).
A taxpayer challenging the correctness of the IRS's assessment of taxes owed has the burden of proving that the assessment is incorrect. United States v. Janis, 428 U.S. 433, 440-41 (1976); Sinder v. United States, 655 F.2d 729, 731 (6th Cir. 1981); see also United States v. Schroeder, 900 F.2d 1144, 1148 (7th Cir. 1990) ("`It is axiomatic that . . . the Commissioner's tax deficiency determinations are to be presumed correct.'") (quoting Barnes v. Commissioner, 408 F.2d 65, 68 (7th Cir. 1969)). If a taxpayer fails to overcome this presumption, the government is entitled to judgment in the amount assessed. Gentry v. United States, 962 F.2d 555 (6th Cir. 1992).
The government has assessed Biondic's unpaid tax liabilities as of September 30, 2003 as being $1,208,873. The government attaches to its motion for summary judgment the Declaration of Fred Yellon, an Insolvency Advisor with the IRS in support of the correctness of its calculations. PI. mot., Exh. A. Biondic overs no evidence to rebut the presumption of correctness accorded this assessment. The court must, therefore, assume that the IRS's assessment is correct.
IV.
For the reasons given above the court grants the government's motion for summary judgment and enters judgment against Biondic in the amount of $1,208,873.