Opinion ID: 491532
Heading Depth: 2
Heading Rank: 1

Heading: Burden of Proof Jury Instruction

Text: 5 Ruth contends on appeal that he was improperly required to prove that he was not liable under section 6672 as a responsible person who willfully failed to collect, account for or pay over taxes withheld from employees of Custom Packaging. According to Ruth, the government bears the risk of nonpersuasion if Ruth is able to present evidence attacking the correctness of the assessment. We disagree and conclude instead that the taxpayer bears the risk of nonpersuasion with regard to claims brought under section 6672. 6 The operation of section 6672 is well established in this circuit and elsewhere--responsible persons who succumb to the temptation to divert the ready cash of wage withholdings out of the clutches of the IRS face serious consequences. See Purdy Co. v. United States, 814 F.2d 1183 (7th Cir.1987); Wright v. United States, 809 F.2d 425 (7th Cir.1987); Garsky v. United States, 600 F.2d 86 (7th Cir.1979); Haffa v. United States, 516 F.2d 931 (7th Cir.1975); see also Slodov v. United States, 436 U.S. 238, 98 S.Ct. 1778, 56 L.Ed.2d 251 (1978); United States v. Sotelo, 436 U.S. 268, 98 S.Ct. 1795, 56 L.Ed.2d 275 (1978); Gephart v. United States, 818 F.2d 469 (6th Cir.1987); Wood v. United States, 808 F.2d 411 (5th Cir.1987); Godfrey v. United States, 748 F.2d 1568 (Fed.Cir.1984). The elements of a violation of section 6672 are likewise well established: the taxpayer must be a responsible person who willfully fails to collect, account for or pay over a tax due under other provisions of the tax code. See, e.g., Purdy Co., 814 F.2d at 1187-88; Wright, 809 F.2d at 427-28. 7 This circuit has not as yet specifically determined, however, how the burdens of producing evidence and persuading the jury are allocated in a section 6672 claim. We agree with the many courts that have held that once the government presents an assessment of liability, the taxpayer bears the burdens of production and persuasion. 2 8 In general, of course, a taxpayer challenging a tax assessment in federal district court must first pay the full amount of the tax assessed and then pursue a refund. Flora v. United States, 357 U.S. 63, 78 S.Ct. 1079, 2 L.Ed.2d 1165 (1958); Curry v. United States, 774 F.2d 852 (7th Cir.1985); 28 U.S.C. Sec. 1346(a)(1). The taxpayer in such a case bears the burdens both of production and of persuasion. United States v. Janis, 428 U.S. 433, 440, 96 S.Ct. 3021, 3025, 49 L.Ed.2d 1046 (1976); Krahmer v. United States, 9 Cl.Ct. 49, 52 (1985), aff'd in part and rev'd in part, 810 F.2d 1145 (Fed.Cir.1987). Section 6672 claims are slightly different--although we hold here insignificantly so--because they involve divisible taxes. The taxpayer is permitted to challenge an assessment in the district court merely by paying a portion of the assessment and then seeking a refund. The government typically brings a counterclaim for the remainder of the tax due. If each moving party had the burden of production or persuasion, identical issues would be reviewed subject to inconsistent risks of nonpersuasion. This is untenable, and we agree with the several other courts which have concluded that the taxpayer must bear the risk of nonpersuasion as to all the issues presented by a section 6672 assessment case. See supra note 2. Thus we reject Ruth's claim of error based on jury instructions allocating the burdens of proof. 9