Court Opinion

ID: 9482945
Source: CourtListenerOpinion
Date Created: 2023-08-05 09:05:52.570905+00
Date Added: 2024-06-11T17:49:18.547441
License: Public Domain

SCIRICA, Circuit Judge,
concurring.
I join the majority opinion on Counts 4, 5, and 6. Although I concur in the judgment on Counts 7 and 8,1 cannot join the majority’s interpretation of § 7201’s affirmative act requirement.
The majority holds that, “unless a taxpayer is in the situation of giving voluntary *243admissions during an investigation or a forced response to a subpoena, the failure of the taxpayer to report the opening of an account in his or her own name in his or her own locale cannot amount to an affirmative act of evasion.” Majority Typescript at 22. Extending this holding to the facts here, the majority concludes that, even assuming McGill deposited the $9,000 in City legal fees subject to levy in his PSFS account, there is insufficient evidence to support the jury’s convictions on Counts 7 and 8. I cannot agree.
In Spies v. United States, 317 U.S. 492, 499, 63 S.Ct. 364, 368, 87 L.Ed. 418 (1943), the Supreme Court said that an “affirmative willful attempt [of tax evasion] may be inferred from ... any conduct, the likely effect of which would be to mislead or to conceal.” This is an expansive definition, one which takes into account that not “all tax payment evaders approach their problem in the same way.” United States v. Conley, 826 F.2d 551, 557 (7th Cir.1987). See also United States v. Hook, 781 F.2d 1166, 1169 (6th Cir.), cert. denied, 479 U.S. 882, 107 S.Ct. 269, 93 L.Ed.2d 246 (1986). Where there is sufficient evidence, the question whether conduct supports a legitimate inference of willful attempt to evade taxes is for the jury, see Spies, 317 U.S. at 500, 63 S.Ct. at 368, whose findings we must accord deference.
At the time McGill opened the PSFS account in August 1988, he was the target of a criminal investigation for tax evasion and had been the subject of five years of civil collection efforts by the IRS. The $9,000 the Government alleges he deposited in the PSFS account consisted of City legal fees which had escaped an IRS levy. Although McGill was aware these funds were subject to levy, he admitted expending them on personal and business items. Nevertheless, he claims to have reported them on his income tax return for that year.
I agree that, in the ordinary case, opening a personal banking account and depositing funds in it will not by itself amount to an affirmative act of tax evasion. But it seems to me that under the proper circumstances, this conduct may support a legitimate inference that a taxpayer has attempted to evade payment of federal tax liabilities. Cf. United States v. White, 417 F.2d 89, 92 (2d Cir.1969), cert. denied, 397 U.S. 912, 90 S.Ct. 910, 25 L.Ed.2d 92 (1970) (allowing jury to infer affirmative act of tax evasion from fact that defendant had “maintained a separate personal banking account in a neighboring town in which he deposited large amounts of [unreported] currency from unidentified sources”).
Assuming McGill deposited the $9,000 in City legal fees subject to levy in the PSFS account, I would find these circumstances present here. Even though McGill claims to have reported the $9,000 on his tax return, because he was aware these funds were subject to levy and was the target of a criminal investigation for tax evasion at the time, I would hold that his deposit and expenditure of the $9,000 without first notifying the IRS supports a legitimate inference that he committed an affirmative act of tax evasion under § 7201. See United States v. Eley, 314 F.2d 127, 132 (7th Cir. 1963) (upholding jury instruction which listed as an “affirmative, willful attempt” to evade taxes the “failure] during the course of an investigation to supply any information for purposes of a computation, assessment or collection of income tax when such failure is found ... to be unjustified”).
However, because I agree with the majority that the Government has failed to meet its burden in establishing that McGill in fact deposited the $9,000 which had escaped the IRS levy in the PSFS account in August 1988, see Majority Opinion at 234, n. 24, I concur in the result on Counts 7 and 8.