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United States v. Ritland

United States District Court, E.D. Wisconsin

January 3, 2017

UNITED STATES OF AMERICA, Plaintiff,
v.
JANE RITLAND, SHAWANO COUNTY, and WISCONSIN DEPARTMENT OF REVENUE, Defendants.

          DECISION AND ORDER GRANTING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT

          William C. Griesbach, Chief Judge

         The United States of America commenced this action seeking to secure Jane Ritland's federal income tax liability by foreclosing federal tax liens, pursuant to 26 U.S.C. § 6321, pertaining to certain real property at ¶ 7104 Frailing Road, Shawano, Wisconsin (the Shawano property). The matter is currently before the Court on the United States' motion for summary judgment. The United States seeks a judgment that, for the tax years 2004 through 2012, Ritland is liable for $138, 458.16 in unpaid federal income taxes, penalties, and interest through September 23, 2016 to the present. It further argues that the Court should enforce the federal tax liens against the Shawano property and order a sale of the property. For the following reasons, the United States' motion for summary judgment is granted.

         SUMMARY JUDGMENT STANDARD

         Summary judgment is appropriate when the moving party shows that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). All reasonable inferences are construed in favor of the nonmoving party. Foley v. City of Lafayette, 359 F.3d 925, 928 (7th Cir. 2004). The party opposing the motion for summary judgment must “submit evidentiary materials that set forth specific facts showing that there is a genuine issue for trial.” Siegel v. Shell Oil Co., 612 F.3d 932, 937 (7th Cir. 2010) (citations omitted). “The nonmoving party must do more than simply show that there is some metaphysical doubt as to the material facts.” Id. Summary judgment is properly entered against a party “who fails to make a showing sufficient to establish the existence of an element essential to the party's case, and on which that party will bear the burden of proof at trial.” Parent v. Home Depot U.S.A., Inc., 694 F.3d 919, 922 (7th Cir. 2012) (internal quotations omitted).

         In this district, Civil Local Rule 56 sets forth specific summary judgment procedures that parties are required to follow. Under the rule, the party moving for summary judgment must submit a statement of stipulated material facts, if any, and “a statement of proposed material facts as to which the moving party contends there is no genuine issue and that entitle the moving party to a judgment as a matter of law.” Civil L.R. 56(b)(1). The party opposing the motion must then file a “concise response to the moving party's statement of facts, ” particularly “in the case of any disagreement.” Civil L.R. 56(b)(2)(B)(i). If the opposing party does not contest the moving party's statement of facts, “[t]he Court will deem uncontroverted statements of material fact admitted solely for the purpose of deciding summary judgment.” Civil L.R. 56(b)(4).

         Here, Ritland, through counsel, did not follow these rules. She did not respond to the United States' statement of facts, submit her own statement of facts, or provide any evidence tending to show that a genuine factual dispute exists. Consequently, the United States' facts are deemed admitted. Fed.R.Civ.P. 56(e)(2); see also Apex Digital, Inc. v. Sears, Roebuck & Co., 735 F.3d 962, 965 (7th Cir. 2013).

         UNCONTROVERTED FACTS

         The following facts are taken from the parties' stipulated material facts and the United States' statement of undisputed material facts. (Stipulated Material Facts (SMF), ECF No. 28-2; Undisputed Material Facts (UMF), ECF No. 28-3.) For the taxable years 2004 through 2012, Ritland filed self-prepared federal income tax returns. (SMF at ¶ 1.) For each of the tax years at issue, a delegate of the Secretary of the Treasury assessed a tax penalty against Ritland for her federal income taxes. Despite notices of the assessments and demands for payment, Ritland has failed to pay the amounts she owes. (UMF at ¶ 50.)

         On April 11, 2008, the United States filed a notice of a federal tax lien on the Shawano property with the Shawano County Register of Deeds. The United States filed additional notices of a federal tax lien on the Shawano property with Shawano County in 2010, 2011, 2013, and 2014. Ritland is the sole owner of the Shawano property, and there are no mortgages on the property. (SMF at ¶¶ 6-7.) As of September 23, 2016, the outstanding balance of Ritland's federal income tax liabilities, including all penalties and interest, is $138, 458.16, computed as follows:

Tax Year

Balance Due

2004

$11, 571.03

2005

$13, 407.24

2006

$18, 063.49

2007

$16, 101.05

2008

$16, 301.68

2009

$18, 958.57

2010

$17, 768.07

2011

$12, 674.98

2012

$13, 612.11

(UMF at ¶ 51.) On September 1, 2015, the United States commenced the present action under 26 U.S.C. § 7403, which allows a district court to order the sale of property that is subject to a federal tax lien.

         ANALYSIS

         A. Assessed Federal Tax Liabilities

         The United States first seeks to reduce Ritland's assessed federal tax liabilities for the tax years 2004 through 2012 to judgment. In an action to collect taxes from a person, the United States has the initial burden to show the amount of taxes due. See, e.g., Nakano v. United States, 742 F.3d 1208, 1211 (9th Cir. 2014) (citation omitted). A taxpayer's liability to pay a tax is established by an “assessment, ” the IRS's evaluation of the amount the taxpayer owes in unpaid taxes. United States v. Fior D'Italia, Inc., 536 U.S. 238, 242 (2002). The IRS uses Form 4340, the certificate of assessments, payments, and other specified matters, to assist in its calculation. Form 4340 establishes the presumption of a valid tax assessment of the amounts the taxpayer owes. See Id. (“It is well established in the tax law that an assessment is entitled to a legal presumption of correctness . . . .”). This presumption of correctness shifts the burden of proof to the taxpayer to show that ...


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