Opinion ID: 1460160
Heading Depth: 2
Heading Rank: 2

Heading: Garnishment proceedings

Text: An order for payment of restitution becomes a lien on all property and rights to property of the defendant upon entry of judgment, see 18 U.S.C. § 3613(c), which in this case was on February 24, 2005. The lien is subsequently perfected when a notice of lien is filed, see § 3613(d); 26 U.S.C. § 6323(f), which in this case was on March 1, 2005. Liens to pay restitution debts are treated like tax liens, see § 3613(c); 26 U.S.C. § 6321 (discussing tax liens), so that they are effective against every interest in property accorded a taxpayer by state law, United States v. Denlinger, 982 F.2d 233, 235 (7th Cir. 1992). We look initially to state law to determine what rights the taxpayer [or in this case, the criminal defendant] has in the property the Government seeks to reach, then to federal law to determine whether the taxpayer's state-delineated rights qualify as `property' or `rights to property' within the compass of the federal tax lien legislation. Drye v. United States, 528 U.S. 49, 58, 120 S.Ct. 474, 145 L.Ed.2d 466 (1999); United States v. Nat'l Bank of Commerce, 472 U.S. 713, 727, 105 S.Ct. 2919, 86 L.Ed.2d 565 (1985). In Indiana marital property is held as a tenancy by the entireties, so that each spouse has an undivided interest in the whole, provided title to the property is held by both husband and wife. [4] Denlinger, 982 F.2d at 236. Indiana law permits a husband to convey property he owns in his own name without the consent of his wife  an act which extinguishes any right the wife may have in the property by virtue of marriage. Id.; IND. CODE § 29-1-2-3.1. Thus, a tax lien can attach to property held in the husband's name when the wife's name is not on the title. Denlinger, 982 F.2d at 235. Federal law determines whether the government's liens attach to the Assets. The primary consideration is the breadth of control the taxpayer could exercise over the property. Drye, 528 U.S. at 61, 120 S.Ct. 474 (quoting Morgan v. Comm'r, 309 U.S. 78, 83, 60 S.Ct. 424, 84 L.Ed. 585 (1940)). For example, the Supreme Court has held the following constitute rights to property: a taxpayer's right under a life insurance policy to compel his insurer to pay him the cash surrender value, United States v. Bess, 357 U.S. 51, 78 S.Ct. 1054, 2 L.Ed.2d 1135 (1958); a taxpayer's right under state law to withdraw the whole of the proceeds from a joint bank account, Nat'l Bank of Commerce, 472 U.S. at 724-25, 105 S.Ct. 2919; and a taxpayer's right to receive the entire value of an estate, even if he immediately elects to pass that value on to someone else, Drye, 528 U.S. at 61, 120 S.Ct. 474. In this case, most of the Assets are in Frank Kollintzas's name alone. Only the Peoples Bank checking accounts are held by Frank and Joanna jointly, and because Frank had the right to withdraw all of the money at any time without Joanna's permission, the government's lien attached to the full value of the account. IND. CODE 32-17-11-22(b) (Any multiple party account may be paid, on request, to any one (1) or more of the parties.); see Nat'l Bank of Commerce, 472 U.S. at 724-25, 105 S.Ct. 2919. After the government's liens attached and after she filed for divorce, Mrs. Kollintzas had an opportunity to establish her claimed interest in the Assets in the garnishment proceedings before the district court. The government conceded in its brief in the district court that Mrs. Kollintzas may establish ownership of all or part of these account funds in this action by producing evidence that she has made contribution of the funds representing these balances. She did not attempt to do so, however. Instead, she argued that the property sought by the government was marital property and as such it was the province of the state trial court, not the federal court, to determine the extent of her interest in the Assets. But the government's liens were perfected and the garnishment proceedings commenced before Mrs. Kollintzas filed for divorce; her opportunity to establish her interest in the property sought to be garnished was therefore in the district court. Her claim that she has a presumptive right to half of the marital property in her divorce action under Indiana law is subject to the government's previously perfected liens, which encumber the Assets to the extent they are part of the marital estate. Mrs. Kollintzas asserted a generalized marital property interest in the district court, but made no effort to establish the amounts (if any) she contributed to the various Assets subject to garnishment. Accordingly, the district court properly concluded that Mrs. Kollintzas failed to establish a claim to the Assets superior to that of the government. AFFIRMED.