United States District Court, N.D. Alabama, Northwestern Division
K. KALLON UNITED STATES DISTRICT JUDGE
United States filed this lawsuit against Neil Taylor
(individually and as the executor of the Estate of Haffred
Neil Taylor), Lanette Taylor, Nancilu Underwood, C. Wilbur
Underwood, and Laura Stewart to reduce to judgment the
federal income and employment tax liabilities of Neil Taylor
and to foreclose federal tax liens which have attached to two
real properties in which Neil Taylor holds an interest. Doc.
1. The United States has reached stipulations regarding the
property interests of Lanette Taylor, the Underwoods, and
Stewart. Docs. 24, 28, 30. Presently before the court is the
United States' motion for summary judgment against Neil
Taylor. Doc. 34. As of the date of this order, Neil Taylor
has not filed a response to the motion. For the reasons
below, the motion is due to be granted.
LEGAL STANDARD FOR SUMMARY JUDGMENT
Rule 56(a) of the Federal Rules of Civil Procedure, summary
judgment is proper “if the movant shows that there is
no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed.R.Civ.P.
56. “Rule 56 mandates the entry of summary judgment,
after adequate time for discovery and upon motion, against a
party who fails to make a showing sufficient to establish the
existence of an element essential to that party's case,
and on which that party will bear the burden of proof at
trial.” Celotex Corp. v. Catrett, 477 U.S.
317, 322 (1986) (alteration in original). The moving party
bears the initial burden of proving the absence of a genuine
issue of material fact. Id. at 323. The burden then
shifts to the nonmoving party, who is required to “go
beyond the pleadings” to establish that there is a
“genuine issue for trial.” Id. at 324
(citation and internal quotation marks omitted). A dispute
about a material fact is genuine “if the evidence is
such that a reasonable jury could return a verdict for the
nonmoving party.” Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986).
is an attorney and owner of a law firm employing several
employees in Russellville, Alabama. Docs. 34-1 at 6; 35 at 1,
4. For the taxable years 2007 through 2014, Taylor owes $216,
158.15, as of March 15, 2019, for unpaid income taxes,
penalties, and interest. Docs. 34-1 at 2-6; 34-2; 35 at 1-6.
In addition, for the years 2008 through 2016, Taylor owes
$166, 041.57, as of March 15, 2019, for unpaid employment
taxes, penalties, and interest. Doc. 34-1 at 8; 34-4; 34-5;
34-6; 34-7; 35 at 6-9. During this period, the Department of
Treasury issued several Notices of Federal Tax Lien, which it
recorded in the Office of the Judge of Probate of Franklin
County, Alabama. The liens notified Taylor of his tax
liabilities, the United States' demand for payment, and
that “there is a lien in favor of the United States on
all property and rights to property belong[ing] to [Taylor]
for the amount of these taxes, ” plus penalties,
interest, and costs. Docs. 34-9 and 34-10. The United States
subsequently filed this suit to reduce to judgement
Taylor's liability and to foreclose its liens on two
parcels of real property in which Taylor has an interest.
Doc. 1. See also 26 U.S.C. §
to the Internal Revenue Code, “if any person liable to
pay any tax neglects or refuses to pay the same after demand,
the amount (including any interest, additional amount,
addition to tax, or assessable penalty, together with any
costs that may accrue in addition thereto) shall be a lien in
favor of the United States upon all property and rights to
property, whether real or personal, belonging to such
person.” 26 U.S.C. § 6321. In light of
Taylor's failure to respond to the United States'
motion, the court reviews whether the United States is
entitled to reduce to judgement Taylor's tax liabilities
and permit federal tax lien foreclosure against Taylor's
Whether the United States May Reduce Taylor's Tax
Assessments to Judgement
reducing [a tax] assessment to judgment, the Government must
first prove that the assessment was properly made.”
United States v. Korman, 388 Fed.Appx. 914, 915
(11th Cir. 2010) (per curiam) (internal quotation marks
omitted). “An ‘assessment' amounts to an IRS
determination that a taxpayer owes the Federal Government a
certain amount of unpaid taxes. It is well established in the
tax law that an assessment is entitled to a legal presumption
of correctness-a presumption that can help the Government
prove its case against a taxpayer in court.” United
States v. Fior D'Italia, Inc., 536 U.S. 238, 242
(2002). Without a “finding that the computational
methods used and . . . the assessment was arbitrary and
without foundation, ” the tax payer's “tax
deficiency is presumptively correct.” Olster v.
Comm'r of Internal Revenue Serv., 751 F.2d 1168,
1174 (11th Cir. 1985) (internal punctuation omitted).
Although the IRS has an ongoing obligation to “make the
inquiries, determinations, and assessments of all taxes . . .
which have not been duly paid, ” 26 U.S.C. §
6201(a), the “taxpayer has the burden of proving that
the [tax assessment] computational method used is arbitrary
and without foundation.” Olster, 751 F.2d at
1174 (citing Mersel v. United States, 420 F.2d 517
(5th Cir. 1970)).
United States has satisfied its burden of providing evidence
demonstrating all of the tax penalties and interest assessed
against Taylor through the declaration of K. Cole, Forms
4340,  and the Notices of Federal Tax Liens that
it filed against Taylor. See docs. 34-1, 34-2, 34-4,
34-5, 34-6, 34-7, 34-8, 34-9, 34-10, 37-1, 37-2; see
also 26 U.S.C. § 7491(c) (stating that the United
States initially has “the burden of production in any
court proceeding with respect to the liability of any
individual for any penalty, addition to tax, or additional
amount imposed by [the tax code]”). The declaration
establishes, in part, that as of March 15, 2019, Taylor owes
$216, 158.15 for unpaid income taxes, penalties, and interest
and $166, 041.57 for unpaid employment taxes, penalties, and
interest. Doc. 34-1 at 2-6, 8. Cole based these amounts on
certified copies of the Department of Treasury Account
Transcript, i.e. Form 4340, of Taylor's employment and
income tax returns, which show Taylor's “assessed
penalties for failing to pre-pay taxes, filing delinquent tax
returns, and making late payments, as well as the interest
charged for late payments.” United States v.
Trevitt, 196 F.Supp.3d 1366, 1379 (M.D. Ga. 2016). Based
on these submissions, the United States “has clearly
met its burden of production regarding the tax penalties and
interest assessed for each year.” Trevitt, 196
F.Supp.3d at 1379.
burden therefore shifts to Taylor to prove the documents'
inaccuracy, or “that the [tax assessment] computational
method used is arbitrary and without foundation.”
Olster, 751 F.2d at 1174. As stated previously,
Taylor opted to ignore the United States' motion.
Consequently, Taylor has failed to meet his burden, and the
court accepts the United States' submissions as
presumptive proof of Taylor's tax liability. See
Korman, 388 Fed.Appx. at 915 (affirming “the
presumption that the assessment was proper” because the
tax payer failed to dispute the accuracy of the assessments,
provided no evidence, and only offered “erroneous,
unsupported, or irrelevant arguments”).
Whether the United States May Foreclose its Tax Liens on
on Taylor's tax liability assessments, the United States
moves to foreclose its tax liens on two of Taylor's real
properties-(1) 105A Jackson Avenue, Russellville, Alabama
35653 (“Office Property”) and (2) 959 Shady Grove
Road, Phil Campbell, Alabama 35581 (“Shady Grove
Property”). Doc. 35 at 16. “Whether the interests
of [Taylor] in the propert[ies]” constitutes
“‘property and rights to property' for the
purposes of the federal tax lien statute, 26 U.S.C. §
6321, is ultimately a question of federal law.”
United States v. Craft, 535 U.S. 274, 278 (2002).
But, because the “federal tax lien statute itself
creates no property rights but merely attaches consequences,
federally defined, to rights created under state law, ”
United States v. Bess,357 U.S. 51, 55 (1958), the
“answer to this federal question, however, largely
depends upon state law.” Craft, 535 U.S. at
278. Accordingly, the court applies Alabama law ...