Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-94-05162/USCOURTS-ca10-94-05162-0/pdf.json

Nature of Suit Code: 422
Nature of Suit: Bankruptcy Appeals Rule 28 USC 158
Cause of Action: 

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PUBLISH 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

FILED 

United States Court of Appeals 

Tenth Circuit 

f1ST 2 4 1995 

PATRICK FISHER 

Clerk 

DONALD P. TAYLOR, 

Plaintiff-Appellant 

vs. No. 94-5162 

INTERNAL REVENUE SERVICE, 

Defendant-Appellee. 

APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF OKLAHOMA 

(D.C. No. 93-CV-608) 

E. John Eagleton, Eagleton, Eagleton & Harrison, Inc., Tulsa 

Oklahoma, for Plaintiff-Appellant. 

Teresa E. McLaughlin, Attorney, Tax Division, Department of 

Justice, Washington, D.C. (Annette M. Wietecha, Attorney, Tax 

Division, Department of Justice, Washington, D.C., Stephen Charles 

Lewis, U.S. Attorney, Tulsa, Oklahoma, with her on the brief), for 

Defendant-Appellee. 

Before BALDOCK, BRORBY, and LUCERO, Circuit Judges. 

BALDOCK, Circuit Judge. 

The Internal Revenue Code requires employers to withhold 

federal social security and income taxes from the wages of their 

employees and pay them over to the government. 26 U.S.C. 

§§ 3102(a), 3402(a), 3403. When an officer or employee of a 

corporation fails to remit withheld taxes to the government, he 

may be subject, inter alia, to the penalty provisions of 26 U.S.C. 

§ 6672. Specifically, the penalty under § 6672 can be assessed 

Appellate Case: 94-5162 Document: 01019280718 Date Filed: 10/24/1995 Page: 1 
against any officer or employee of a corporation who: (1) is 

under a duty to "collect, truthfully account for, and pay over any 

tax imposed by this title"--i.e., a "responsible person"; and (2) 

"willfully fails" to do so. 26 U.S.C. § 6672(a) .1 Plaintiff 

Donald P. Taylor, an officer of Delta Cattle Corporation 

("Delta"), appeals from a district court order holding him liable 

to Defendant Internal Revenue Service ("IRS") for tax penalties 

under 26 U.S.C. § 6672. We have jurisdiction under 28 U.S.C. 

§ 158 (d) . 

I. 

The record reveals the following. Plaintiff and his brother 

Oscar Taylor incorporated Delta in Oklahoma in 1981. Delta had a 

business office in Tulsa, Oklahoma and ranches in eastern 

Oklahoma. Delta's business was breeding, raising, and marketing 

cattle for investors throughout the United States. 

Oscar Taylor was the president of Delta and managed its 

business operations. Oscar owned all of Delta's stock. He made 

all the corporation's business decisions, determined what checks 

were to be written and which creditors to pay. 

1 Section§ 6672(a) provides that: 

Any person required to collect, truthfully account 

for, and pay over any tax imposed by this title who 

willfully fails to collect such tax, or truthfully 

account for and pay over such tax, or willfully attempts 

in any manner to evade or defeat any such tax or the 

payment thereof, shall, in addition to other penalties 

provided by law, be liable to a penalty equal to the 

total amount of the tax evaded, or not collected, or not 

accounted for and paid over. 

Id. at§ 6672(a). Section§ 6671(b) defines "person" for purposes 

of § 6672 as "an officer or employee of a corporation . . . who 

. . . is under a duty to perform the act in respect of which the 

violation occurs." 

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Plaintiff was the vice president of Delta and served on its 

board of directors, but owned none of Delta's stock. Plaintiff 

was an authorized signatory on fourteen Delta checking accounts 

and had authority to borrow funds on Delta's behalf. Plaintiff 

hired and fired employees. Plaintiff had checkwriting authority, 

instructed clerical help as to which bills to pay, and engaged in 

fiscal matters, but only at the direction of Oscar. Plaintiff 

spent very little time in the Tulsa business office, but managed 

the office in Oscar's absence. Plaintiff's principal 

responsibility was the "cowboy"--i.e., supervising the breeding, 

raising, and marketing of the cattle. It was not Plaintiff's duty 

within the corporate structure to prepare the payroll, ensure that 

employee taxes were withheld, file quarterly returns and make 

quarterly deposits. Plaintiff, however, signed one employment tax 

return for Delta in 1982. 

In March 1984, Delta filed a petition for relief under 

Chapter 11 of the Bankruptcy Code. Delta owed $117,162.26 in 

withholding taxes to the IRS. In February 1985, the IRS sent 

Plaintiff a Notice of Proposed Assessment of 100% Penalty. The 

notice identified the specific quarterly tax periods for which 

there was an unpaid tax liability, the amount of unpaid taxes, and 

the penalty amounts. The notice specified that because efforts to 

collect the unpaid taxes from Delta had failed, the IRS intended 

to assess the $117,162.26 in accumulated penalties against 

Plaintiff because he was a "responsible person" at Delta pursuant 

to 26 U.S.C. § 6672. 

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In March 1985, the IRS assessed the § 6672 penalties against 

Plaintiff under a Form 4340 Certificate of Assessments and 

Payments ("Form 4340"). The Form 4340 identified Plaintiff and 

explained that the IRS had assessed a 100% penalty against him in 

connection with Delta. The assessing officer signed the Form 

4340, which provided the following additional information in 

pertinent part: 

Explanation Assessment 

of Transaction 

Penalty Assessment $117,161.16 

23C Date Period Ending 

03-18-85 12-31-81-

12-31-82 

06-30-83-

03-31-84 

In March 1986, the IRS filed a notice of federal tax lien 

against Plaintiff with the Tulsa County Clerk. In December 1986, 

Plaintiff filed a petition for relief under Chapter 7 of the 

Bankruptcy Code and in June 1987 received a discharge. In August 

1987, the IRS refiled its notice of federal tax lien. In 

September 1990, Plaintiff filed a complaint to determine and 

discharge tax liability in the bankruptcy court. Plaintiff denied 

he was liable to the IRS for the $117,166.26 in tax penalties. 

The IRS moved for partial summary judgment and asserted 

Plaintiff was liable for tax penalties under § 6672 because he was 

a "responsible person" as a matter of law. Plaintiff filed a 

response and contended that he was not a "responsible person" 

under § 6672 and did not willfully fail to pay over taxes owed to 

the government. The bankruptcy court denied the IRS's motion for 

partial summary judgment. 

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After a bench trial, the bankruptcy court specifically found 

that Plaintiff was not a "responsible person" under § 6672. The 

bankruptcy court explained that a "responsible person" under 

§ 6672 "is the person who within the corporate structure has the 

job to see that the withheld taxes are paid"--i.e., the person who 

is "actually responsible within the corporation for the payment of 

payroll taxes." Applying this standard, the bankruptcy court 

found that Oscar Taylor, rather than Plaintiff, was the corporate 

officer at Delta who had the specific responsibility to ensure 

that the withheld taxes were paid. 

The court found that Oscar was the "boss" of Delta, made all 

the business decisions of the company, dealt with creditors, and 

determined what checks were to be written and what bills were to 

be paid. The court found that Plaintiff, in contrast, was Delta's 

"cowboy," with responsibility for breeding, raising, and marketing 

cattle. The bankruptcy court noted that Plaintiff had certain 

"badges of authority" because he was an officer and director of 

Delta, an authorized signatory on five checking accounts,2 had 

authority to borrow funds on behalf of Delta, and hired and fired 

employees. The court noted, however, that Plaintiff signed checks 

and engaged in fiscal matters only at Oscar's direction and that 

Plaintiff was not responsible for ensuring employee taxes were 

withheld and paid over to the government. As a result, the 

bankruptcy court concluded that Plaintiff was not a "responsible 

person" under § 6672. Because the court concluded Plaintiff was 

2 The record reflects Plaintiff was actually an authorized 

signatory on fourteen checking accounts. See infra note 4. 

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not a "responsible person" under § 6672, it did not reach the 

question whether Plaintiff willfully failed to pay the withholding 

taxes. 

On appeal, the district court reversed. After reviewing the 

record as a whole, the district court concluded Plaintiff was a 

"responsible person" pursuant to § 6672 as a matter of law: 

[Plaintiff] instructed clerical help as to what bills to 

pay, managed day-to-day operations when his brother was 

absent, hired employees, served as vice-president and 

controller, had checkwriting authority, signed at least 

one employment tax return, and was aware that taxes were 

not paid at least in 1982. While he may not have had as 

much authority over corporate decisionmaking as his 

brother, the record establishes that he possessed a 

sufficient degree of authority over corporate 

decisionmaking to make him a "responsible person." 

The district court also concluded the record established that 

Plaintiff's failure to pay the taxes was willful. As a result, 

the court concluded the IRS had a valid claim for $117,162.26 

against Plaintiff. 

Plaintiff filed a motion to alter or amend the judgment. In 

addition to his prior arguments, Plaintiff contended the § 6672 

penalty was void because it was improperly assessed as a lump sum 

instead of on a quarterly basis.3 The district court denied 

Plaintiff's motion with regard to the responsible person and 

willfulness issues. The district court remanded to the bankruptcy 

court, however, for a determination whether the IRS's lump sum 

assessment against Plaintiff was valid. On remand, the bankruptcy 

court upheld the lump sum assessment. The district court 

affirmed. This appeal followed. 

3 The district court concluded Plaintiff had previously raised 

this argument in a hearing before the bankruptcy court. 

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II. 

A. 

On appeal, Plaintiff first contends the district court erred 

by concluding he was a "responsible person" under § 6672. 

Specifically, Plaintiff maintains the district court erred by 

overturning the bankruptcy court's factual finding that he was not 

a responsible person pursuant to § 6672 because the bankruptcy 

court's factual findings were not clearly erroneous. We conclude 

Plaintiff's argument misapprehends the scope of the district 

court's appellate review of the bankruptcy court's determination 

that he was not a "responsible person." 

Our review of the district court's factual and legal 

determinations is governed by the same standards the district 

court used to review the bankruptcy court. See Travelers Ins. Co. 

v. American AgCredit Corp. (In re Blehm Land & Cattle Co.), 859 

F.2d 137, 138 (lOth Cir. 1988) ("In reviewing an order of the 

bankruptcy court, the appellate court applies the same standard as 

the district court."). The district court reviews the factual 

determinations of the bankruptcy court under the clearly erroneous 

standard, Rowe Int'l, Inc. v. Herd (In re Herd), 840 F.2d 757, 759 

(lOth Cir. 1988), and reviews the bankruptcy court's construction 

of§ 6672 de novo. In re Blehm Land & Cattle Co., 859 F.2d at 

138. We agree with the Second and Eleventh Circuits that the 

bankruptcy court's ultimate determination whether an individual 

constitutes a "responsible person" pursuant to § 6672 involves an 

application of law to fact, which is subject to de novo review by 

the district court. Hochstein v. United States, 900 F.2d 543, 547 

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(2d Cir. 1990); Thibodeau v. United States, 828 F.2d 1499, 1503 

(11th Cir. 1987); cf. Barnett v. I.R.S., 988 F.2d 1449, 1454 (5th 

Cir.) (court notes that although it has generally treated the 

determination whether a person is responsible as a question of 

fact, certain facts demonstrate a person is responsible as a 

matter of law), cert. denied, 114 S. Ct. 546 (1993); but see 

Caterino v. United States, 794 F.2d 1, 3 (1st Cir. 1986) (treating 

district court's determination that Plaintiff was a responsible 

person as a factual question subject to clearly erroneous review), 

cert. denied, 480 U.S. 905 (1987); Maggy v. United States, 560 

F.2d 1372, 1375 (9th Cir. 1977) (same), cert. denied, 439 U.S. 821 

(1978). Thibodeau, 828 F.2d at 1503. In its de novo review, the 

district court may review the record as a whole to determine 

whether the facts demonstrate that an individual constitutes a 

responsible person pursuant to § 6672. Thibodeau, 828 F.2d at 

1503-05; see Denbo v. United States, 988 F.2d 1029, 1032-33 (lOth 

Cir. 1993). 

" [A] corporate officer or employee is responsible if he or 

she has significant, though not necessarily exclusive, authority 

in the 'general management and fiscal decisionmaking of the 

corporation.'" Denbo, 988 F.2d at 1032 (quoting Kizzier v. United 

States, 598 F.2d 1128, 1132 (8th Cir. 1979)). In this circuit, we 

have set forth a non-exclusive list of factors demonstrating 

"indicia of responsibility." Specifically, we examine whether the 

person: (1) held corporate office; (2) controlled financial 

affairs; (3) had authority to disburse corporate funds; {4) owned 

stock; and (5) had the ability to hire and fire employees. Id. 

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If an individual possesses sufficient indicia of responsibility, 

he is a "responsible person" under § 6672 regardless whether he: 

(1) has the final say as to which creditors should be paid, Bowlen 

v. United States, 956 F.2d 723, 728 (7th Cir. 1992); Gephardt v. 

United States, 818 F.2d 469, 475 (6th Cir. 1987); or (2) has the 

specific job within the corporate structure to see that the taxes 

are paid over to the government, see Denbo; 988 F.2d at 1032; 

McGlothlin v. United States, 720 F.2d 6, 8 (6th Cir. 1983) (" [I]t 

is not necessary that a [responsible] person be the one who 

prepared the tax returns, kept the books and records, paid the 

wages or withheld the taxes."). "The crucial inquiry is whether 

the person had the 'effective power' to pay the taxes--that is, 

whether he had the actual authority or ability, in view of his 

status within the corporation, to pay the taxes owed." Barnett, 

988 F.2d at 1454. Liability under § 6672 extends to all 

responsible corporate officers or employees, not just to the 

single "most" responsible individual. Turnbull v. United States, 

929 F.2d 173, 178 (5th Cir. 1991); see Denbo, 988 F.2d at 1032 

("[T]here may be more than one responsible person."); accord 

Keller v. United States, 46 F.3d 851, 854 (8th Cir.), cert. 

denied, slip op. (U.S. Oct. 2, 1995); Thomas v. United States, 41 

F.3d 1109, 1113 (7th Cir. 1994); Gephardt, 818 F.2d at 476. 

Applying these principles to the facts of the instant case 

and based upon our review of the record, we conclude the district 

court correctly determined Plaintiff constituted a "responsible 

person" pursuant to § 6672. Contrary to Plaintiff's contention 

that the district court overturned factual findings of the 

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bankruptcy court when it determined he was a "responsible person," 

the district court properly determined de novo the mixed question 

of law and fact whether Plaintiff constitutes a "responsible 

person" under § 6672. Hochstein, 900 F.2d at 547; Thibodeau, 828 

F.2d at 1503. In its de novo review, the district court relied on 

facts found by the bankruptcy court, as well as facts apparent in 

the record. The district court determined that Plaintiff 

possessed several indicia of responsibility and had significant 

authority in the general management and fiscal decisionmaking at 

Delta. We agree. 

The record reflects that Plaintiff: (1) was vice president 

of Delta and a corporate director; (2) was an authorized signatory 

on fourteen Delta checking accounts;4 (3) had authority to borrow 

funds on Delta's behalf; (4) hired and fired employees; (5) 

instructed clerical help as to which bills to pay and engaged in 

4 The bankruptcy court found that Plaintiff was an authorized 

signatory on five Delta checking accounts. Aplee. Supp. App. at 

17. The district court stated that Plaintiff was an authorized 

signatory on fourteen Delta checking accounts. Id. at 30. At 

oral argument, Plaintiff's counsel cited this discrepancy in 

arguing that the district court erroneously overturned factual 

findings of the bankruptcy court. The district court was of 

course bound by this factual finding of the bankruptcy court 

unless the district court determined the bankruptcy court's 

factual finding was clearly erroneous. In re Herd, 840 F.2d at 

759. Based upon our review of the record, we conclude the 

district court did not err in overturning the bankruptcy court's 

finding that Plaintiff was an authorized signatory on five Delta 

checking accounts. The record clearly reflects that Plaintiff was 

an authorized signatory on fourteen Delta checking accounts. 

Aplee. Supp. App. at 95-96. In any event, both courts agree 

Plaintiff had checkwriting authority. Whether that authority 

extended to five or fourteen accounts in the instant case is not 

critical. Rather, the critical point is that Plaintiff had 

checkwriting authority, which is another indicia of responsibility 

in the total calculus of whether he constituted a "responsible 

person" under § 6672. 

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fiscal matters at Oscar's direction; (6) managed day-to-day 

operations in the Tulsa business office when Plaintiff was there 

and Oscar was absent; (7) had checkwriting authority; and (8) 

signed at least one employment tax return. Applying the Denbo 

factors, Plaintiff: (1) held corporate office; (2) had authority 

to disburse corporate funds; and (3) had the ability to hire and 

fire employees. Denbo, 988 F.2d at 1032. Although Plaintiff 

owned none of Delta's stock and engaged in fiscal matters only at 

the direction of Oscar, Plaintiff nonetheless possessed sufficient 

control over corporate finances, had authority to borrow funds and 

write checks and thereby had the "effective power" to pay the 

taxes. Barnett, 988 F.2d at 1454; see Denbo, 988 F.2d at 1033 

(" [W]hile it is clear that Allred exercised greater control over 

the corporation than Denbo ... [i]t suffices that Denbo had 

'significant, as opposed to absolute, control of the corporation's 

finances.'"). Because Plaintiff had the effective power to pay 

Delta's taxes based upon his significant corporate authority, 

Plaintiff constitutes a responsible person at Delta regardless 

whether he had the final say as to which creditors would be paid, 

Bowlen, 956 F.2d at 728, and regardless whether it was his 

specific job within the corporate structure to see that the taxes 

were paid over to the government. Denbo; 988 F.2d at 1032; 

McGlothlin, 720 F.2d at 8. We therefore conclude the district 

court did not err in holding Plaintiff was a "responsible person" 

pursuant to § 6672. 

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B. 

Plaintiff next contends the district court erred by 

concluding he willfully failed to pay over taxes to the government 

in the absence of any factual determination on that point from the 

bankruptcy court. Specifically, Plaintiff argues the district 

court sitting as a court of appeal should have remanded to the 

bankruptcy court to make a factual finding on the issue of 

willfulness. The IRS maintains it is apparent on the face of the 

record that Plaintiff willfully failed to pay over the taxes to 

the government and therefore the district court's determination 

was proper. 

"Willfullness, in the context of section 6672, means a 

'voluntary, conscious and intentional decision to prefer other 

creditors over the Government.'" Denbo, 988 F.2d at 1033. "A 

responsible person's failure to investigate or to correct 

mismanagement after being notified that withholding taxes have not 

been paid satisfies the section 6672 willfulness requirement." 

Id. Both this court and the district court are bound by the 

factual findings of the bankruptcy court unless those findings are 

clearly erroneous. In re Herd, 840 F.2d at 759. Additionally, 

the district court [acting as an appellate court] may 

not make its own independent factual findings. If the 

bankruptcy court's factual findings are silent or 

ambiguous as to an outcome determinative factual 

question, the district court may not engage in its own 

factfinding but, instead, must remand the case to the 

bankruptcy court for the necessary factual 

determination. 

Wegner v. Grunewaldt, 821 F.2d 1317, 1320 (8th Cir. 1987); accord 

Rush v. JLJ Inc. {In re JLJ Inc.), 988 F.2d 1112, 1116 (11th Cir. 

1993); In re Apex Oil Co., 960 F.2d 728, 731 (8th Cir. 1992); Oaks 

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of Woodlake Phase III. Ltd .. v. Hall, Bayoutree Assocs .. Ltd. (In 

re Hall, Bayoutree Assocs., Ltd.), 939 F.2d 802, 804 (9th Cir. 

1991); Hardin v. Caldwell (In re Caldwell), 851 F.2d 852, 857 (6th 

Cir. 1988). 

Applying these standards to the instant case, the district 

court erred by concluding Plaintiff willfully failed to pay over 

taxes to the government in the absence of fact findings on this 

issue from the bankruptcy court. ~, Wegner, 821 F.2d at 1320. 

"In a bankruptcy proceeding, the bankruptcy court is the finder of 

fact," In re Caldwell, 851 F.2d at 857, and the district court 

functions as an appellate court. The bankruptcy court did not 

reach the issue of willfulness and therefore made no findings on 

the issue. As a result, the district court determined this issue 

without a proper record. We therefore reverse the district 

court's determination that Plaintiff willfully failed to pay taxes 

to the government under § 6672. We remand with instructions to 

the district court to remand to the bankruptcy court to make 

findings of fact on the issue of willfulness. 

c. 

Plaintiff also contends the district court erroneously 

concluded that the penalty assessment made by the IRS was valid. 

Specifically, Plaintiff argues that the assessment made by the IRS 

in the instant case was invalid because it was made in an 

aggregate, lump sum amount representing nine quarters, instead of 

separate quarterly assessments. Plaintiff maintains that just as 

the IRS collects employment taxes quarterly, it must assess a 

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§ 6672 penalty quarterly instead of in an aggregate lump sum 

amount. 

The IRS responds that there is no requirement in the Internal 

Revenue Code or regulations that a § 6672 penalty be assessed 

quarterly instead of in a lump sum amount. Rather, the IRS 

asserts that a § 6672 penalty is not a tax liability imposed for a 

particular tax period, but is instead an aggregate sum penalty 

equal to the total amount of unpaid withholding taxes. See 26 

U.S.C. § 6672 (a responsible party is "liable to a penalty equal 

to the total amount" of the unpaid withholding taxes) (emphasis 

added). We review de novo the district court's determination that 

the IRS's lump sum assessment was valid. Thomas, 44 F.3d at 886. 

Section 6672 renders a responsible person who willfully fails 

to pay over taxes "liable to a penalty equal to the total amount" 

of the unpaid withholding taxes. Section 6671 of the Internal 

Revenue Code provides that "[t]he penalties and liabilities 

provided by this subchapter . shall be assessed and collected 

in the same manner as taxes." Section 6203 provides that "[t]he 

assessment shall be made by recording the liability of the 

taxpayer in the office of the Secretary in accordance with rules 

or regulations prescribed by the Secretary." The pertinent 

Treasury regulation provides: 

The assessment shall be made by an assessment officer 

signing the summary record of assessment. The summary 

record, through supporting records shall provide 

identification of the taxpayer, the character of the 

liability assessed, the taxable period if applicable, 

and the amount of assessment. 

Treas. Reg. § 301.6203-1. "Certificates of Assessments and 

Payments are routinely used to prove that tax assessment has in 

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fact been made . . . [and] are presumptive proof of a valid 

assessment." Guthrie v. Sawyer, 970 F.2d 733, 737 (lOth Cir. 

1992) (quotation omitted) . 

In support of his argument that § 6672 penalties must be 

assessed on a quarterly basis, Taxpayer relies on a passage from 

Stallard v. United States, 12 F.3d 489 (5th Cir. 1994): 

Bureaucratic ineptitude and indifference--coupled with 

judicial admissions made as part of a confused 

litigation strategy--have combined to produce an 

untenable argument by the government: that the 

assessment of a penalty tax under § 6672 need not refer 

to particular tax periods to be valid. We reject this 

argument as unsound, contrary to precedent and contrary 

to the strictures of the IRS's own regulations. 

Consequently, we conclude that the IRS's failure here to 

assess taxes under § 6672 for the proper tax period 

renders that assessment void. 

Aplt. Br. at 14 (quoting Stallard, 12 F.3d at 496). Taxpayer's 

reliance on Stallard is misplaced. The Fifth Circuit in Stallard 

concluded that an IRS assessment of § 6672 penalties was invalid 

where the Certificate of Assessments and Payments referred to the 

wrong tax period. Thus, the court concluded the IRS's assessment 

was invalid in Stallard because the taxpayer "was assessed for but 

one tax period, one for which he owed nothing." Stallard, 12 F.3d 

at 495. 

The Stallard court acknowledged, however, that an aggregate, 

lump sum assessment of § 6672 penalties is permissible, as long as 

the IRS identifies the particular tax period for which the 

taxpayer is liable: 

As the government correctly notes, § 6672 liability 

applies to the total amount due; of course, the "total 

amount due" for a responsible party is predicated on 

accruals for each tax period in which that taxpayer is a 

responsible party. Nonetheless, an assessment based on 

the last period for which the taxpayer is a responsible 

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party would be sufficient as that assessment would be 

for a particular tax period in which the taxpayer is 

liable, and that assessment would accurately reflect 

that an accrued amount is due for that period. 

Thus, our holding today would not necessarily 

affect the typical case in which the government assesses 

a taxpayer for the last of several periods for which 

that taxpayer had § 6672 liability. 

Id. at 495. Contrary to Plaintiff's contention, therefore, the 

Stallard court recognized that a lump sum assessment of § 6672 

penalties by the IRS is permissible. Other courts have also 

recognized that the IRS may make a lump sum assessment of § 6672 

penalties. Carr v. United States, 72 A.F.T.R.2d (P-H) ~ 93-5311 

(W.D. Mo. 1993) (collecting cases); Ronsberg v. United States, 798 

F. Supp. 582, 583-86 (D.N.D. 1992). We agree. 

Under § 6672 a responsible person is "liable to a penalty 

equal to the total amount" of the unpaid withholding taxes, rather 

than for distinct, separate amounts based upon particular tax 

periods. See 26 U.S.C. § 6672 (emphasis added). Because § 6672 

renders a responsible person who willfully fails to comply with 

the statute liable for the total amount of unpaid withholding 

taxes, we agree with the Fifth Circuit that the IRS may make a 

lump sum assessment of § 6672 penalties, provided that it 

otherwise complies with pertinent regulations. See Stallard, 12 

F.3d at 496; see also Carr, 72 A.F.T.R. at ,I 93-5311; Ronsberg, 

798 F. Supp at 583-86. 

In the instant case, the Form 4340 provided Plaintiff with 

all of the information required under Treasury Regulation 

§ 301.6203-1. Specifically, the Form 4340 identified Plaintiff, 

informed him of the character of the liability assessed, 

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applicable tax periods and amount of the assessment, and was 

signed by the assessing officer. See Treas. Reg. § 301-6203-1. 

Accordingly, the IRS's assessment complied with pertinent 

regulations and the Form 4340 was therefore presumptive proof that 

a valid assessment was made. Guthrie, 970 F.2d at 737. We agree 

with the district court that Plaintiff has not overcome this 

presumption in the instant case. As a result, we conclude the 

IRS's lump sum assessment of § 6672 penalties was permissible. We 

note, however, that although we conclude the IRS's lump sum 

assessment was permissible, if the bankruptcy court on remand 

determines Plaintiff did not willfully fail to pay over taxes to 

the government, Plaintiff would not be liable for the $117,162.26 

in penalties assessed under § 6672. 

In sum, we AFFIRM the district court's determination that 

Plaintiff constitutes a "responsible person" pursuant to § 6672. 

We also AFFIRM the district court's determination that the IRS's 

aggregate assessment in the instant case was valid. We REVERSE 

the district court's determination that Plaintiff willfully failed 

to pay over withholding taxes to the government. We REMAND with 

instructions to the district court to REMAND to the bankruptcy 

court for further proceedings consistent with this opinion. 

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