Source: http://federaltaxprocedure.blogspot.com/2015/12/good-discussion-of-burden-of-proof-when.html?utm_source=feedburner&amp;utm_medium=email&amp;utm_campaign=Feed%3A+FederalTaxProcedure+%28Federal+Tax+Procedure%29
Timestamp: 2019-04-25 11:05:11+00:00

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Cases are replete with burden of proof discussions as if burden of proof played a role in case outcomes. Of course, in criminal cases, burden of proof beyond a reasonable doubt is critical and a constitutional requirement. But in most civil cases the assignment of the ultimate burden of proof -- the burden of persuasion -- merely determines who wins and who loses if the trier of fact is in equipoise -- i.e., is unable to find that the fact more likely than not existed or didn’t exist. If the trier believes that the evidence establishes that the fact more likely than not existed, then it doesn't matter which of the parties had the burden of proof or any component of it. Similarly, if the trier believes that the evidence establishes that the fact more likely than not did not exist, then it also doesn’t matter which of the parties had the burden of proof or any component of it. It is only where the trier is unable to make the affirmative finding that the case is affected by which party bore the burden of proof (or any component).n1928 Most trial observers feel that it is rare that a trier – whether judge or jury – is in this state of equipoise so that the assignment of the burdens of proof may not ultimately be that important an issue, but it is important in framing and trying a case, of course.n1929 In fact, in judge tried cases, it is common for the trial judge to discuss in the opinion the burden of proof (i.e., the burden of persuasion) to a greater or lesser extent, but then to say that, after all, the discussion is irrelevant because he is not in a state of equipoise as to any issue. n1930 n1928 An interesting case illustrates the phenomenon where the trier is in equipoise so that the resolution turns upon the assignment of the burden of proof, meaning in this case the burden of persuasion. In Forste v. Commissioner, T.C. Memo 2003-103, the issue was whether the taxpayer could exclude $45,615 from income under a prior version of § 104. The court first determined that then recently enacted § 7491 which I discuss in more detail below applied to assign the burden of proof to the IRS as to $25,130. The Court held that the IRS had failed to meet that burden and thus, without an affirmative finding, held that that portion was excluded under § 104. As to the balance of the payment, the Court held that the taxpayer bore the burden of proof and held for the IRS because the taxpayer had not met his burden of proof. In other words, as to both components, the Court was in equipoise so that the assignment of the burden of proof controlled the result. For an application of this type of analysis in a criminal sentencing, see United States v. Safiedine, 2013 U.S. Dist. LEXIS 179364 (ED MI 2013) (where the preponderance of the evidence standard applied to tax loss and restitution issues; as to tax loss, the taxpayer bore the burden of persuasion on unclaimed deductions and as to restitution, the Government bore the burden of persuasion; since the court was in equipoise on unclaimed deductions, the tax loss was computed without the unclaimed deductions but as to restitution, the amount was determined with the unclaimed deductions).
n1929 Cigaran v. Heston, 159 F.3d 355, 357 (8th Cir. 1998) (“The shifting of an evidentiary burden of preponderance is of practical consequence only in the rare event of an evidentiary tie . . . .”); see also Polack v. Commissioner, 366 F.3d 608, 613 (8th Cir. 2003) (citing the Cigaran case); Blodgett v. Commissioner, 394 F.3d 1030, 1039 (8th Cir. 2004); and Knudsen v. Commissioner, 131 T.C. 185, 188 (2008); Estate of Bongard v. Commissioner, 124 T.C. 95, 111 (2005) (declining to decide who has the burden of proof (persuasion) because the Tax Court decides the case on the preponderance of the evidence).
n1930 In doing so, the judges often cite the cases cited in the preceding footnote to this text or cases with the applicable circuit’s variation of this theme. Estate of Jorgensen v. Commissioner, 2011 U.S. App. LEXIS 9203 (9th Cir. 2011) (“When, as here, the tax court decides the case based on the preponderance of the evidence and without regard to presumptions of correctness, § 7491's burden-shifting is simply not relevant”); see also Scheidelman v. Commissioner, 755 F.3d 148 (2d Cir. 2014) (burden of proof shift under § 7491 is immaterial because the position sustained is “more persuasive, regardless of the burden of proof”) . Moreover, if a trial judge does not expressly say that he is not in equipoise, a court of appeals may effectively so determine by saying that the allocation of the burden of persuasion did not affect the decision. See e.g., Whitehouse Hotel Ltd. Partnership v. Commissioner, 615 F.3d 321, 332-333 (5th Cir. 2010) (“there is no indication that the tax court's decision turned on the allocation of the burden”).

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