Opinion ID: 729641
Heading Depth: 3
Heading Rank: 2

Heading: Calculation of Kraig's Base Offense Level

Text: 48
49 Kraig's base offense level was established pursuant to U.S.S.G. § 2T1.9, Conspiracy to Impair, Impede or Defeat Tax. Kraig does not contest the correctness of using this guideline, but contends that the wrong subsection of the guideline was used in determining his base offense level. Subsection (a) provides that the greater of (1) the base offense level for section 2T1.1 or section 2T1.3, whichever is applicable depending on the underlying conduct, or (2) base offense level 10 should be applied. Section 2T1.1, Tax Evasion, and section 2T1.3, Fraud and False Statements Under Penalty of Perjury, provide that the base offense level for these crimes is to be determined by applying the tax tables contained in section 2T4.1. 50 The District Court determined that section 2T1.9(a)(1) applied and therefore looked to section 2T1.1 and section 2T1.3 as directed. The District Court determined that either section 2T1.1 or section 2T1.3 could be applied in this case and because they both use the tax table in the same way, as a practical matter, therefore, it was not necessary to determine which section applied. Both sections 2T1.1 and 2T1.3 direct the user to establish the tax loss caused by the conduct and to then look to the tax loss table in section 2T4.1 to determine the base offense level. Kraig contends that because there was no tax loss as defined in the sections 2T1.1 and 2T1.3 and his offense is not similar to either of the tax offenses covered by sections 2T1.1 or 2T1.3, the District Court should have defaulted to section 2T1.9(a)(2) and imposed a base offense level of 10. 51 We do not agree with Kraig's interpretation. The plain language of section 2T1.9 states that the applicable statutory provision is 18 U.S.C. § 371. Application Note 2 provides that the base offense level should come from sections 2T1.1 or 2T1.3, whichever is most applicable, if the base offense level is more than 10. As the base offense level applicable here under either section is greater than 10, the plain language of the guideline directs that one of these two sections is to be used. The case law is in agreement. See, e.g., United States v. Moore, 997 F.2d 55, 60 (5th Cir.1993); United States v. Hunt, 25 F.3d 1092 (D.C.Cir.1994). 52
53 Kraig asserts that if this Court determines that the tax loss table under § 2T4.1 does apply to determine his base offense level, the District Court's calculation of the tax loss here was based on improper valuations of the properties involved. Kraig maintains that the tax loss did not exceed $1,500,000 and that the base offense level, therefore, should have been 17. We do not agree. The trial court conservatively estimated the tax loss at between $1,500,000 and $2,500,000 for a base offense level of 18. 54 In assessing the amount of tax loss, the district court is to make a reasonable estimate of the amount of the loss that defendant intended to inflict, not the actual amount of the government's loss. United States v. Moore, 997 F.2d at 55. See also Sentencing Memorandum at 3, J.A. at 51. 55 The trial court estimated the value of four properties in arriving at the estimated amount that the conspiracy attempted to conceal from the government to be in excess of $1,500,000 but less than $2,500,000. This is a conservative estimate and is supported by the evidence. The trial court purposely omitted including the value of two properties where it found the amounts more tentative. Sentencing Memorandum Opinion at 4, J.A. at 52. The District Court's loss valuation is not clear error and is affirmed.