Opinion ID: 361300
Heading Depth: 1
Heading Rank: 3

Heading: The amount of Simpkins' tax liability

Text: 27 Simpkins was both writer and pick up man. He does not argue that he was not liable for the wagering tax that the jury found he owed. Rather the government contends that he is liable for more. The government seized $24,719.00 from Simpkins' home. He filed this refund suit seeking to recover a portion of this money, alleging that he had handled only about $100 of bets a day during the relevant period. The 10% Tax due on this volume of bets would be more than satisfied by the $24,719.00 seized from Simpkins, and he asked for refund of the excess. The government counterclaimed, seeking payment of $76,686.76 in unpaid wagering taxes. IRS' calculation of wagering taxes owed by Simpkins was based on its estimate that he had handled $475.05 a day in wagers during the relevant period. The jury was given special interrogatories on this issue, and they found that Simpkins had handled $101.00 a day during the relevant period. Acting on this special verdict, the district judge ordered refund of part of the money seized from Simpkins and dismissed the government's counterclaim. The government argues that the judge erred in submitting this issue to the jury because Simpkins had not introduced sufficient evidence to meet his burden of disproving IRS' estimate of his tax liability. We disagree. 28 If, as here, a taxpayer fails to keep a daily record of all wagers placed with him as required by law, the Commissioner of Internal Revenue may estimate the amount of tax liability. See U. S. v. Firtel, 446 F.2d 1005 (CA5, 1971). In a refund suit by the taxpayer, he bears a double burden of proof. To recover he must first prove that the Commissioner's estimate is inaccurate and then prove the correct amount of tax owed. U. S. v. Janis, 428 U.S. 433, 440, 96 S.Ct. 3021, 3025, 49 L.Ed.2d 1046, 1052 (1976). For purposes of this opinion we assume that the rule in this circuit is that the taxpayer bears the same burden of proof with respect to a government counterclaim for additional taxes due. See Heyman v. U. S., 497 F.2d 121 (CA5, 1974). 19 Finally, the law of this circuit is that a taxpayer cannot meet either his burden of proving the Commissioner's assessment inaccurate, Heyman v. U. S., supra, or his burden of proving the correct amount owed, Heyman; Carson v. U. S., 560 F.2d 693, 699 (CA5, 1977), solely by his own uncorroborated oral testimony about the amount of wagers handled. 29 Simpkins testified by deposition that he took in about $100 in wagers a day, rather than the $475 claimed by the government. If this were the sole evidence introduced it would be insufficient to meet his burden of proof, but additional pieces of evidence tend to corroborate Simpkins' testimony. He testified that he kept his day's take from the numbers operation separate from his other money and that on the day his house was raided he had wrapped the previous day's take in a one pound paper bag, which he had placed in a drawer. He also testified that he did not know precisely how much money was in the bag the day of the seizure. This bag was seized from the drawer by FBI agents and found to contain $101 in cash. The bulk of the money seized, some $27,000, was found in a small steel chest that Simpkins had concealed behind his bed. 20 30 That $101 was found wrapped separately, taken in conjunction with the rest of the money being found in places not readily accessible, was sufficient corroboration of Simpkins' oral testimony that he took in about $100 a day for the judge to allow the issue to go to the jury. 21 Simpkins did not rely only on his uncorroborated testimony; thus Carson and Heyman do not control. From the evidence introduced the jury could reasonably conclude that Simpkins had carried his burden of proving that the government's estimate of the amount of wagers he handled was incorrect and his burden of proving that he had instead handled about $100 a day.