United States Court of Appeals Fifth Circuit 

## FILED October 3, 2006 Charles R. Fulbruge III Clerk UNITED STATES COURT OF APPEALS

FIFTH CIRCUIT

____________ No. 05-10238

____________ UNITED STATES OF AMERICA,
Pl aint iff - Appellee,
versus EDWARD WESLEY ROUSH, JR, Defendant - Appellant.
Appeal from the United States District Court For the Northern District of Texas
Before GARZA, PRADO, and OWEN, Circuit Judges. EMILIO M. GARZA, Circuit Judge: Edward Wesley Roush, Jr. (“Roush”) appeals the belo w-guidelines sentence imposed after his guilt y- plea conviction for tax evasion, in violation of 26 U.S.C. § 7201. I On February 5, 1998, Roush rece ived income in t he form of WasteMasters, Inc. stock for legal services he had performed during 1997 and 1998. On September 30, 1998, Roush caused 20,191,500 shares to be issued to six business entities, none of which filed tax returns in 1998. In1 The individuals were involved in a scheme to use the threat of litigation to force

Wastemaster, Inc. to issue 63 million shares of its stock to the co-conspirators. -2- Roush’s 1998 tax return, which he filed in 2002, he declared a taxable income of $11,150. He did not report th e receipt of the WasteMasters stock, although he did claim charitable contri butions on his 1998 and 1999 tax returns fo r donating over 4 millio n shares to John Marshall Law School
. The government estimat ed that the value of the stock received in 1998 was approximately $3.4 millio n and estimat ed th at th e corresponding tax lo ss was approximately $1,148,409. Roush and others were indict ed on 47 counts of wire fraud, securities fraud, mo ney laundering, and conspiracy. 1 Roush was also indicted on one count of tax evasion. When he pleaded guilty to tax evasion, the remainder of th e charges were dismissed. The Probation Officer who prepared the Presentence Report (“PSR”) calculated the amo unt of tax lo ss fo r sentencing purposes at $1,148,409, establishing a Base Offense Level of 22. S ee U.S. S ENTENCING G UIDELINES § 2T4.1 (2004) (hereinafter U.S.S.G.). Aft er a two-level increase for failure to report inco me in excess of $10,000 derived from criminal activit y, U.S.S.G. § 2T1.1(b)(1),
a two-level increase fo r use of “sophisticated means,” U.S.S.G. § 2T1.1(b)(2), and a three-level reduction fo r acceptance of responsibility, U.S.S.G. § 3E1.1(a) & (b), the Probation Officer determ ined Roush’s Total Offense Level was 23, resulting in a sentencing range of 46 to 57 mo nt hs. Roush objected to th e adjustments fo r failure to report inco me derived from criminal activit y and fo r
use of sophisticated means. He also objected to the calculation of the tax loss. The district court held
a sentencing hearing on th e question of the appropri ate measure of the tax lo ss. Testimo ny fo cused
on whether th e stock, which was restricted, was valueless by the end of 1998 and what impact that had on the tax loss calculation.2 Due to shareholder lit igation and actions by the Securities and Exchange Com missio n (“SEC”), related to th e fraud charges that were eventually filed against Roush, the shares were cancelled )) and thus rendered valueless )) in mid-December.

3 By doing so, th e district court did not take into account the total number of shares Roush received as income.

4 The record is unclear as to the substance of thes e f ilings. However, neither party objected at th e time and no party raises concerns on appeal as to this additional ten-month reduction. -3- The district court ult imat ely adopted the PSR, specifically noting th at it believed th at the tax lo ss calculation in th e PSR was correct. However, the district court expressed concerns about the severity of th e sentence in light of the fact that the stock was worthless by the end of 1998, 2 stating

“ th at that com

putation significantly overstates the actual seriousness of the offense here.” Rather th an using the PSR’s $0.5160 p er share value f or the stock, the di strict court used the total value Roush had placed on th e shares donated to John Marshall Law School in both 1998 and 1999, approximately $1,666,800. 3 The district court stated at sentencing: “But I think in terms of trying to determ ine a fair sentence and a fair reflection of the g ravam en of the offense, I think taking the defendant ’s own cl aimed amount of contribution, charitable contribution, is a fair reflection [ ].” Applying th e 39.6 percent tax bracket to the total value of the charitable donations to determ ine the tax lo ss, the district court determined that the Total Offense Level would be 21, resulting in a sentencing range of 37 to 46. After being reminded of additional filings, the district court reduced th e s entence again t o 27 m onths. 4 The district court also required restitution in the amount of $652,000, a special assessment of $100, and two years of supervised release. Roush now appeals, contesting the calculation of th e guidelines range contained in the PSR and arguing th at the sentence impo sed is unreasonable. II5 This discount was applied because the stock was restricted. Restricted stock, under

17 C.F.R. § 230.144, “may not be sold publicly wit hin two years of it s acquisition
. . . unless it is fir st registered wit h th e SEC.
. . . Rule 144 does not normally prohibit private placement sales or pledges of such stock, however, alt hough th e restrictions of transferability apply also to the transferees or assignees.” McDonald v. C.I.R. , 764 F.2d 322, 323 n.3 (5th Cir. 1985). -4- Roush, on appeal, fir st challenges the district court’s acceptance of the PSR’s calculation of th e tax lo ss, th e use of th e 39.6 percent tax bracket, and the application of t he enhancements for failure to report income derived from criminal activity and the use of sophisticated means. A Tax lo ss is “t he total amo unt of lo ss th at was th e object of the offense.” U.S.S.G. § 2T1.1(c)(1); see also United States v. Clements , 73 F.3d 1330, 1339 (5th Cir. 1996) (holding th at tax lo ss “means th e tax deficiency assessed
. . . rather th an the amo unt th at the IRS could actually recover”). To calculate the total tax loss for purposes of the PSR, the probation officer used the fair market value (“FMV”) of th e stock on February 5, 1998, the date th at Roush became able to request delivery of the stock (average trading price of $0.5160). This amount was then m ult iplied by t he number of shares (20,191,500). The value of the shares was then discounted by 67 percent. 5 The total actual gross receipts were th erefore $3,435,543. The probation officer then subtracted $38,874 of reported gross inco me to reach th e total unreported inco me of $3,396,669. Aft er subtracting the it emized deductions and using the 39.6 percent tax bracket, the total tax loss was $1,148,409. Roush argues, as he did at sentencing, that the tax loss used to determ ine t he Base Offense Level in th e PSR was inco rrect. Roush asserts that the stock should be valued at the close of the taxable year. He then argues that the value of the stock by the end of 1998 was de minimus (worth $0.01 per share) if not utterl y valueless because of the stock’s cancellation. He also argues that even during 1998, th e restricted nature of th e stock further suppressed the value of the shares. We review6 Roush did not request issuance of the shares until Septem ber 30, 1998. The value of th e shares increased during th e fir st part of 1998 and were, in fact, mo re valuable in Septem ber 1998 th an they were in Feburary. -5- th e application of th e guidelines de novo and factual findings fo r clear error. U nited States v. Clark , 139 F.3d 485, 490 (5th Cir. 1998) (reviewing the district court’s computation of the tax loss). Under th e Internal Revenue Code, when prope rty is t ransferred in connection with the performance of services, “t he excess of (1) the fair market v alue of such property (determ ined wit hout regard to any restriction oth er than a restriction which by its terms will never lapse) at the fir st time th e rights of th e person having the beneficial int erest in such property are transferable or are not subject to a substantial risk of forfeiture, whichever occurs earlier, over (2) the amo unt (if any) paid fo r such property , shall be included in the gross inco me o f t he person who perf orm ed such services in the fir st taxable year. . . .” 26 U.S.C. § 83(a). For the purposes of the PSR, the stock was valued on February 5, 1998, th e date th at Roush was fir st able to request the issuance of the shares. 6 The Government argues th at this is th e correct date. In contrast, Roush argues that the stock should be valued at the end of the taxable year. On February 5, 1998 Roush had the right to request immediat e issuance of the stock and thus, constructively received th e stock. S ee Arnw ine v. C.I.R. , 696 F.2d 1102, 1111 (5th Cir. 1983) (“[A] cash basis taxpayer will be deemed to be in constructive receipt of inco me when it becomes available to him wit hout substantial restrictions.”); see also Reed v. C.I.R. , 723 F.2d 138, 142 (1st Cir. 1983) (“[U]nder the constructive receipt doct ri ne, a taxpayer recognizes taxable income when he has an unqualified, vested right to receive immediat e payment.”). Ty pically, stock is valued on the date the shares are issued. See Champion v. C.I.R. , 303 F.2d 887, 891 (5th Cir. 1962) (applying the “wellsettled rule that stock received as com pensation fo r services rendered to the issuing corporation is-6-

taxable as ordinary inco me of an amo unt equal to the value of the stock at the date of issuance”); see also Pledger v. C.I.R. , 641 F.2d 287, 291 (5th Cir. 1981) (“[ T]he val ue of [defendant’s]
com pensation fo r purposes of taxation could be determ ined by reference to the fair market value of th e stock on th e day of purchase.”). Because Roush took constructive receipt of the stock on February 5, that is th e correct date on which to establish valuation. S ee Wolder v. C.I.R. , 493 F.2d 608, 612-13 (2d Cir. 1974) (observing th at stock is valued on the date of constructive receipt). The Revenue Ruling cit ed by Roush in support of his argument th at the stock should be valued at the end of 1998 is inapposite as it deals wit h th e recission of a contract th at voided the transfer of property , thus extinguishing all taxable inco me. S ee Rev. Rul. 80-58, 1980-1 C.B. 181. Roush’s argument that th e stock should have been valued at the end of the year fails. Furthermore, th e fact th at th e stock was restricted at all times during 1998 did not render it s fair market value eit her zero or de minimus fo r the purposes of inco me calculations. S ee McDonald , 764 F.2d at 325 (di scussing how th e fair market value of a share of stock i s determined without regard to restrictions). This court has analyzed a situation in which a taxpayer purchased corporate stock pursuant to a stock option plan th at wa s subj ect to certain restrictions on subsequent sale. Pledger , 641 F.2d at 288. The sales agreement in P ledger sti pulated th at the restricted stock was worth only 65 percent of it s fair market value if sold pursuant to a private placement sale. I d. at 289. The taxpayer argued th at I.R.C. § 83(a) unconstitutionally allo wed Congress to tax in excess of the value for which the stock could be sold. Id. In rejecting this argument, we wrote: When he purchased th e stock, the value of his com pensation fo r purposes of taxation could be determined by reference to the fair market value of the stock on the day of purchase. Alt hough taxpayer argues that t he stock subj ect to the securi ties restrictions was worth only 65 percent of it s fair market value, taxpayer ignores the fact that the sti

pulation regarding the 65 percent value pertained only to the7 We note th at th e tax lo ss analysis ult imat ely did take int o account the restricted nature

of th e stock, di scounting its value by 67 percent. -7- discounted value if th e sto ck were sold in another private placement sale. A sti pulation as t o th e value of property if so ld under certain circumstances does not necessarily reflect th e value of the property in the hands of the current owner. . . . The full value of th e stock existed from the mo ment of purchase; it was only tem porarily subject to a diminution in value if exchanged because of the securities restrictions. Despite taxpayer’s claim to th e contrary , there was no nonexistent value upon which he was taxed. Id. at 291. The court went on to note that the fact that a stock could radically decrease in value after th e init ial purchase was simply “part of the ri sk any stockholder encounters when he purchases stock” and concluded th at “Congr ess may constitutionally tax the full fair market value at the time of purchase without regard to the temporary restriction.” Id. This analy s is is inst ructive. Alt hough Roush’s shares were restricted, he c ould in fact sell th em; alt hough a restricted stock cannot be sold publically, it can be sold in a private sale. Indeed, Roush reported a sale of 925,122 of th e shares on December 6, 1998, valuing them at approximately $0.59 per share. As this court observed in Pledger , the fact that stock i s restricted, or even specifically valued fo r th e purposes of private sales at less th an the fair market value, does not affect th e valuation of the shares for income purposes. 7 Therefore, th e district court did not clearly err when it used the fair market value of the shares on February 5, 1998 to determine the tax loss. B Roush argues th at th e district court erred in placing him in the 39.6 percent tax bracket when determ ining th e total tax lo ss. He contends that under the Sentencing Guidelines, “the tax loss shall be tre a ted as equal of 28 percent of the unreported gross inco me . . . unless a mo re accurate-8-

determ inat io n of th e tax lo ss can be made.” U.S.S.G. § 2T1.1(c)(1)(A); s ee also United States v. Cseplo , 42 F.3d 360, 364 (5th Cir. 1994). Roush did not object to the use of the 39.6 percent tax bracket during sentencing and we th erefore review fo r plain error. S ee United States v. Hoover , 175, F.3d 564, 567-68 (7th Cir. 1999) (applying the clear error standard of review to the district court’s choice of applicable tax br acket where appellant objected below); s ee also United States v. McCaskey , 9 F.3d 368, 376 (5th Cir. 1993) (noting th at unobjected to findings of fact are subject to plain error review). Roush’s brief simply asserts th at th e 39.6 percent tax bracket is incorrect, but offers no
reasons why the use of the 39.6 percent tax bracket constitutes plain error. The probation officer applied th e 39.6 percent tax bracket when calculating the total tax lo ss. A PSR bears sufficient indicia of reliabilit y to considered evidence. United States v. Cothran , 302 F.3d 279, 286 (5th Cir. 2002). In addition, during th e sentencing hearing, the IRS analyst also used the 39.6 percent f igure. S ee United States v. Thomas , 12 F.3d 1350, 1372 (5th Ci r. 1994) (“Sworn testimo ny given by a government agent at a sentencing hearing generally bears sufficient indicia of reliabilit y t o be considered by th e tri al judge during sentencing.”); United States v. Aubin , 87 F.3d 141, 150 (5th Cir. 1996) (upholding th e tax lo ss calculation of IRS invest igative agents). Roush has offered no rebuttal evidence that the 39.6 percent tax bracket was inco rrect and thus, the district court did not pl ainly
err. C Roush challenges th e two-level enhancement fo r use of “sophisticated means.” S ee U.S.S.G. § 2T1.1(b)(2) (mandating a two-level increase if the offense involved sophisticated means.). “We review th e district court’s factual finding th at [the de fendant] used sophisticated means to impede-9-

discovery of his of

fense fo r clear error.” U

nited States v. Clements , 73 F.3d 1330, 1340 (5th Cir. 1996). When Roush requested th e issuance of the WasteMasters stock, he had the shares issued to six com panies, which t h e PSR characterized as “shell com panies.” The relevant guidelines
com ment ary notes th at “hiding assets or transactions, or both, through the use of fictitious entities, corporate shells, or of

fsho re financial accounts ordinarily indicates sophisticated means.” U.S.S.G. § 2T1.1, cmt . n.6. “We must consider the commentary to the Guidelines as authoritative.” U nited S tates v. Wise , 447 F.3d 440, 446 (5th Cir. 2006); U.S.S.G. § 1B1.7 (“Failure to follow such
com ment ary could consti

t ute an inco rrect application of the guidelines.”). Roush asserts, without further elaboration, th at th e existence of six pass-through corporate entities does not trigger the twolevel adjustment. Because Roush has not demonstrated that the district court was incorrect to follow th e guidelines com

ment ary , th e district court did not clearly err in impo sing a two-level enhancement fo r use of sophisticated means. S ee Clements , 73 F.3d at 1340 (hold ing t hat defendant’s use of mult iple cashiers checks and his wife’s separate bank account to “o bscure the link” between the
mo ney and himself constituted sophisticated means). D Roush challenges the two-level enhancement fo r failure to report inco me over $10,000 th at resulted from criminal activit y, in this case, the fraudulent suit against Wastemasters. S ee U.S.S.G. § 2T1.1(b)(1). Again, we review for clear error. S ee United States v. Creech , 408 F.3d 264, 270 n.2 (5th Cir. 2005). Roush contends th at th e government failed to adduce evidence th at the source of the inco me
was criminal activit y. He does not, however, support thi s argument. Roush thus fails to rebut the-10-

PSR’s finding th at th e stock was derived from a criminal fraud conspiracy to use a lawsuit to force WasteMasters to issue 63 millio n shares of it s stock to the co-conspirators. As discussed above, info rmation in th e PSR th at is unrebutted by the defendant bears sufficient indicia of reliabilit y to be considered evidence by the district court. See Cothran , 302 F.3d at 286. Roush also argues fo r th e fir st time on appeal th at this provision vio lat es the Fift h Amendment right against self-incrim

inat io n because it penalizes failure to self-report criminal activity. This argument also fails. The point of the enhancement, as discussed in the Application Notes, is to further deterrence, particularly in light of th e chronic under-reporting of criminally-derived inco me. S ee U.S.S.G. § 2T1.1(b)(1) cmt . background. The two-level increase does not itself force an individual to d isclo se the income, but merely takes into account the source of income when penalizing nondisclosure. S ee United States v. Sullivan , 274 U.S. 259, 263 (1927) (holding th at the requirement th at inco me from “illicit traf fic in liquo r” be disclosed did not vio lat e the Constitution, stating “[i]t would be an extreme if not extravagant application of the Fift h Amendment to say th at it authorized
a man to refuse to state th e amo unt of his inco me because it had been made in crime”); United States v. Johnson , 577 F.2d 1304, 1310-11 (5th Cir. 1978) (holding that requiring disclosure of inco me,
even inco me deriv ed from illegal activity, on a tax return does not violate the Fifth Amendment, noting that the individual retains th e option of disclosing the inco me wit hout revealing its source). Thus, th e district court did not clearly err in impo sing the two-level enhancement fo r failure to report
mo re than $10,000 derived from criminal activity. III In addition to his objections to the PSR, Roush contends th at the district court’s sentence was
u nreasonable because it was based on an inco rrect tax lo ss value. To support thi s argument, he8 We note that th e 46 to 57 m onth sentencing range is the district court’s original guideline range calculation and does not reflect the filings alluded to by the district court to revise the deviating, non-guideline sentencing range from 37 to 46 mo nt hs to 27 to 37 mo nt hs. Because the record fails to reflect th e substance of th ese filings, we cannot evaluate the reduction on the r ecord b efore us. The basis fo r this reduction should appear in the record. S ee e.g. , United States v. Smith , 440 F.3d 704, 706-07 (5th Cir. 2006) (“Wit hout a properl y- calculated Guideline range, we cannot ensure th at th e disparity between [the defendant’s] sentence and the Guideline range is warranted.”) Since we are remanding fo r re-sentencing, any party wishing the court to consider this reduction on subsequent appeal should ensure that these filings are on the record. -11- reasserts his contention th at th e stock was valueless by the end of the year. He also argues that it was unreasonable to include the 1999 charitable donations in the calculations because there was no evidence in the record that his 1999 tax returns were falsified. Here, th e calculated guidelines range was 46 to 57 mo nt hs. 8 Roush received a 27-month sentence. The district court expressed its discomfort with the 46 to 57 month guidelines range based
on it s understanding of th e relative worthlessness of the defendant’s stock at the end of the tax year and, thus, impo sed a lo wer sentence, basing it s calculation on the reported charitable deductions fo r gift s of the stock. The district court stated during sentencing:

It’s my view that the government is correct wit h regard to the calculation of inco me tax. I am going to vary from the Guidelines because I t hink under these circumstances, alt hough th e tax calculation I believe is correct, given the fact th at wit hin th e same tax year th e sto ck became essenti ally wo rthless, I think that that com putation significantly overstates the actual seriousness of the offense here. It may be technically a correct calculation of what the Internal Revenue Code calls fo r, but I think under the circumstances with regard to the seriousness of t he criminal o ffense, that that’s just not a fair basis for sentencing. . . . I think a mo re fair representation of the of fense would be fo und by attri buting as income the amount of th e charitable contributions that was claimed and applying to th at a tax rate of 39 percent, which, if done, would result in a t wo-level decrease of th e of fense level. These were the only reasons given by the district court for its decision to deviate downwards. As mandated by United States v. Booker , 543 U.S. 220 (2005), we review a sentence for-12-

unreasonableness. U

nited States v. Duhon , 440 F.3d 711, 714 (5th Cir. 2006). Here, the di strict court deviated from th e guidelines, rather th an fo rmally departing as permitted by the guidelines. Roush does not argue otherwi se. “Before imposing a non-Guideline sentence, a district court must consider th e Sentencing Guidelines.” I d. at 715 (citing United States v. Smith , 440 F.3d 704, 707 (5t h Cir. 2006), U

nited States v. Mares , 402 F.3d 511, 518-19 (5th Cir. 2005)). According to Duhon , consideration of th e guidelines requires th at the dist ri ct court “ calculate the appropriate Guideline range” and “articulate fact-specific reasons” fo r deviating from the guideline range. D uhon , 440 F.3d at 715. In this case, the district court did calculate the appropriate guideline range and did articulate fact-specific reasons fo r th e deviation, namely th at the guidelin e sentence overstates the seriousness of the offense because the stocks were essentially worthless at the end of the tax year. However, a mere articulation of fact-specific reasons fo r the deviation is not sufficient to meet th e reasonableness standard. Rather, “[t]hose reasons should be ‘consistent with the sentencing factors enumerated in section 3553(a).’” I d
. ( cit ing Smith , 440 F.3d at 707). “A no n-Guideline sentence unreasonably fails to ref lect the statutory sentencing factors where it 1) does not account fo r a factor that should have received significant weight, 2) gives significant weight to an irrelevant or improper factor, or 3) represents a clear error of judgment in balancing the sentencing factors.” Smith , 440 F.3d at 707 (applying th e framework articulated in United States v. Haack , 403 F.3d 997, 1004 (8th Cir. 2005)). Based on th e explanation th e district court provided at the sentencing hearing, this nonguideline sentence gives significant weight to an irrelevant or improper factor and therefore fails. The district court deviated from th e guideline sentence because it gave significant weight to the year-end value of the stock. But th e year-end value of the stock is not relevant to the crime of tax evasion.-13-

The purpose of th e tax evasion statute is to punish the tax lo ss to the government and not to punish th e personal enrichment of the defendant. See 18 U.S.C. § 7201 (stating th at the object of the tax evasion statute is “[a]ny person who willfully at tem pts in any manner to evade or defeat any tax impo sed by this ti

tle or payment th ereof”); see also Spies v. United States , 317 U.S. 492, 497 (1943) (finding felo ny tax evasion to b e “the capstone of a system of sanctions which singly or in
com binat io n were calculated to induce prom pt and fo rthright fulfillment of every duty under the inco me t ax law and to provide a penalty suitable to every degree of delinquency.”). The sentencing guidelines further emphasize t h is pol icy goal
. U.S.S.G. § 2T1.1 cm t. background (“This guideline relies mo st heavily on the amount of loss that was the object of the of fense. Tax offenses, in and of themselves, are serious offenses; however, a greater tax loss is obviously mo re harmful to the treasury and more serious than a smaller one wit h otherwise similar chara cteri sti cs.”). That the purpose of the tax evasion statute is to punish tax evasion and not personal enrichment is true regardless of whether the district court impo ses a guideline sentence or a non-guideline sentence. A district court’s determ

inat io n of the seriousness of the of fense under § 3553(a)(2)(A) must be rationally rel ated to the nature of the of fense. Without such a limitation, the district court’s discretion would become unbounded and would make applying the reasonableness standard on appeal impo ssible. Because there is no apparent connection between the year-end stock value and the
s eriousness of th e of

fense, and because the district court did not articulate such a connection, w e determ ine th at th e district court significant ly relied upon an irrelevant factor. Therefore, the district court’s non-guideline sentence “fails to advance sufficient ly the sentencing objectives enumerated in section 3553(a)(2)(A)--(B).” Duhon , 440 F.3d at 720.-14-

As a result of this analysis, we agree wit h Roush th at it was improper fo r the district court to scale Roush’s sentence to his 1999 charitable contri butions. Aft er submitting that the actual tax loss was “not a fair basis fo r sentencing,” the district court fo und th at the charitable contri butions were
a “mo re fair representation of th e of fense.” Because the district court relied on an improper factor to determ ine what should be a fair basis fo r sentencing, namely the year-end stock value, the district court’s substitution of the charitable contributions is similarly improper. In holding th at th e district court gave significant weight to an irrelevant factor, we do not suggest th at a non-guideline sentence fo r tax evasion must be scaled to the tax lo ss. To do so would improperly limit th e district court’s d iscretion in sentencing. Further, we do not hold that the seriousness of th e of

fense must be limit ed to a consideration of the tax lo ss. A district court may find th at oth er factors enumerated in § 3553(a) justify a deviation, eit her upward or downward, from the sentencing range. However, the justifications for any deviation must be reasonably tied to the factors enumerated in § 3553(a). In this case, the district court’s reliance o n t he year-end stock value to mit igate th e seriousness of th e of fense, wit hout elaboration justifying th at reliance, fails to meet this standard. Because th e district court of fered no justification reasonabl y r elated to the factors under § 3553(a) for its decision to deviate from the guidelines, we hold th at the sentence is unreasonable. Alt hough we ult imat ely agree wit h Roush as to the unreasonableness of his sentence, we d isagree th at, under th e guidelines, th e value of the stock should be assessed at t he end of the year. Accordingly, we VACATE Roush’s sentence and REMAND to the district court fo r re-sentencing9 Roush raises th ree further arguments as to his sentence. First he argues that he was entitled to notice of th e district court’s decision to deviate from the guidelines. Second he argues that th e amount of restitution ordered by the district court was improperly based on the district court’s recalculation of th e tax lo ss. Thir d he argues that his enhancements were not proven beyond a reasonable doubt. He acknowledges, however, that this argument is foreclosed, s ee United States v. Mares , 402 F.3d 511 (5th Cir. 2005), and he has raised it only to preserve it for further review. Because we vacate and remand on oth er grounds, we need not reach these arguments except to note th at th e district court failed to state any underlying reason fo r the $652,000 in restitution, an amo unt considerably lo wer th an th e approximate $1,666,800 value he placed on the stock. See Part I, s upra . -15- not inconsistent with this opinion. 9