United States v. Henco Holding Corp., 985 F.3d 1290

Henco (a C corporation) sold its valuable subsidiary stock in 1997, creating a large capital-gains tax liability; its shareholders (the Caceres Defendants) used a Skandia intermediary scheme to receive most sale proceeds, leaving Henco insolvent.
The IRS audited Henco, issued a notice of deficiency, Henco defaulted, and the IRS assessed roughly $56 million in tax, penalties, and interest against Henco on October 26, 2007.
The government sued Henco and the Caceres Defendants in district court in 2018 to reduce Henco’s assessed tax to judgment and to recover fraudulent transfers from the Caceres Defendants under Georgia law; a default judgment was entered against Henco.
The Caceres Defendants moved to dismiss, arguing the IRS failed to timely assess them as transferees under I.R.C. § 6901 (which they read to impose a 1‑year assessment window after the transferor’s assessment), so the government’s claim was time-barred; they also argued Georgia’s statute of limitations applied.
The district court dismissed the government’s claims against the Caceres Defendants, concluding § 6901 required a separate transferee assessment and that the government’s opportunity to assess had expired.
On appeal, the Eleventh Circuit reversed and remanded, holding Leighton and subsequent authority permit the government to proceed against transferees without a separate § 6901 assessment when the transferor’s tax was timely assessed under § 6502.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the government must separately assess transferees under I.R.C. § 6901 before suing them for transferor’s assessed tax	Government: No; § 6502 assessment of transferor suffices and § 6901 is an optional additional remedy	Caceres: Yes; § 6901’s “shall” and its 1‑year rule make separate assessment mandatory and the IRS missed the window	Held: No. Leighton and subsequent circuit and Supreme Court precedent allow suit against transferees based on a timely assessment of the transferor; § 6901 is an additional tool, not exclusive.
Whether Georgia’s statute of limitations bars the United States from pursuing fraudulent-transfer claims	Government: U.S. is not bound by state SOLs when enforcing federal tax claims	Caceres: State 4‑year limitations (or UFTA) should bar the suit	Held: U.S. is not bound by Georgia’s statute of limitations; dismissal on that ground was improper.

Leighton v. United States, 289 U.S. 506 (1933) (permits government to sue transferees for transferor’s assessed tax without separate transferee assessment under predecessor to §6901)
United States v. Galletti, 541 U.S. 114 (2004) (assessment records the tax liability; IRS need not duplicate assessments against secondarily liable persons)
Updike v. United States, 281 U.S. 489 (1930) (limitations on enforcement of tax liabilities attach to the debt as a whole)
United States v. Continental Nat’l Bank & Trust Co., 305 U.S. 398 (1939) (distinguishable—holding suit time‑barred where applicable limitations had expired for both transferor and transferee avenues)
Hall v. United States, 403 F.2d 344 (5th Cir. 1968) (allows in rem ancillary proceedings to set aside fraudulent conveyances to collect a judgment against taxpayers)
United States v. Russell, 461 F.2d 605 (10th Cir. 1972) (applies Leighton to hold §6901 procedures are cumulative, not exclusive)
United States v. Geniviva, 16 F.3d 522 (3d Cir. 1994) (follows Leighton principle that lack of separate transferee assessment does not bar suit)
L.V. Castle Inv. Grp., Inc. v. C.I.R., 465 F.3d 1243 (11th Cir. 2006) (addresses Tax Court standing and timing for transferees to contest liability; does not overrule Leighton)