116 F. Supp. 3d 1242
D. Kan.2015Background
- Eldon Boisseau, a Wichita attorney, was indicted for willfully attempting to evade federal income taxes for multiple years (1998–2000, 2002–2005, 2007–2008) and for a trust-fund recovery penalty; bench trial occurred May 5–6, 2015.
- As of April 6, 2015, Boisseau owed the IRS more than $1 million from self-reported liabilities and an assessed trust-fund penalty; he made minimal payments toward these liabilities.
- In 2005 Boisseau formed the Law Offices of Eldon L. Boisseau, LLC, but had the firm owned by a nominee (Richard Johnson) to shield firm assets from IRS collection; Johnson performed no work and received nominal compensation.
- After the IRS levied Boisseau’s personal bank account in February 2008, Boisseau resigned his employment agreement and stopped taking paychecks; the firm thereafter paid his personal living expenses directly from a firm account (recorded as receivables owed by Boisseau).
- Boisseau misrepresented to the IRS (and in the firm’s response to a demand) that he was not receiving compensation; he also submitted installment proposals that the IRS found not bona fide.
- The court found these acts (use of a nominee owner, altering compensation to avoid wage levy, and false statements about compensation) to be affirmative acts taken willfully to evade payment of tax and convicted him under 26 U.S.C. § 7201.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Existence of substantial tax liability | IRS assessments and Boisseau’s own returns show over $1M owed | (Implicit) liabilities not in dispute but amount not necessary to exactness | Court: substantial liability proven beyond reasonable doubt |
| Affirmative act constituting evasion | Boisseau used a nominee owner, stopped wages, had firm pay personal expenses, and lied to IRS—these are affirmative acts to place assets outside IRS reach | Boisseau argued acts insufficient or not a “constellation” of deceit; contested some alleged acts | Court: at least one affirmative act proven (nominee + altered compensation + misrepresentations) |
| Willfulness (intent) | Acts and admissions show deliberate intent to evade levies and payment | Defense argued lack of requisite willfulness or good-faith collection efforts | Court: willfulness inferred from conduct, admissions, sophistication; element satisfied |
| Sufficiency of evidence / motions for acquittal | Government introduced direct and circumstantial evidence establishing elements | Boisseau moved for judgment of acquittal and finding of not guilty after bench trial | Court: denied motions; conviction stands |
Key Cases Cited
- Spies v. United States, 317 U.S. 492 (defining breadth of § 7201 and that evasion may be accomplished “in any manner”)
- Sansone v. United States, 380 U.S. 343 (standard for proving tax evasion elements)
- United States v. McGill, 964 F.2d 222 (3d Cir.) (using business accounts/nominees after bank levy supports evasion conviction)
- United States v. Conley, 826 F.2d 551 (7th Cir.) (lawyer’s use of nominees and failure to pay taxes supports evasion conviction)
- United States v. Jungles, 903 F.2d 468 (7th Cir.) (altering compensation arrangement can constitute affirmative act of evasion)
- United States v. Hoskins, 654 F.3d 1086 (10th Cir.) (affirming inference of willfulness from conduct)
- United States v. Chisum, 502 F.3d 1237 (10th Cir.) (trust-fund recovery penalty treated as tax for § 7201 purposes)
- United States v. Schoppert, 362 F.3d 451 (8th Cir.) (using third-party credit cards and false statements supports evasion conviction)