United States v. Peter Giambalvo
2016 U.S. App. LEXIS 478
| 8th Cir. | 2016Background
- Peter A. Giambalvo, a Boeing systems engineer, mailed Form 1040s for tax years 2003–2010 to an IRS revenue officer on or about January 26, 2011, each reporting zero income and requesting refunds.
- Prior to that, Boeing received an IRS lock-in letter in 2006 altering Giambalvo's withholding; Giambalvo had wages reported on W-2s for the years at issue.
- Giambalvo admitted he prepared the zero returns after reading Peter Hendrickson’s Cracking the Code and other materials asserting that most private income is not taxable.
- Indicted March 5, 2014, Giambalvo was convicted by a jury of one count under 26 U.S.C. § 7212(a) (omnibus clause) and eight counts under 26 U.S.C. § 7206(1) (making and subscribing false returns); sentenced to 16 months’ imprisonment.
- On appeal he challenged: statute of limitations for § 7212(a); exclusion of IRS witness testimony about similar “zero” returns; exclusion of expert testimony and amended returns showing no tax deficiency; sufficiency of evidence that documents were “tax returns”; and exclusion of evidence about the filing date.
Issues
| Issue | Giambalvo's Argument | Government's Argument | Held |
|---|---|---|---|
| Statute of limitations for § 7212(a) omnibus clause | The six-year exception in 26 U.S.C. § 6531(6) applies only to the intimidation clause; omnibus clause is governed by three-year period so Count 1 is time-barred | The parenthetical in § 6531(6) is descriptive; the six-year period applies to all § 7212(a) prosecutions | Six-year statute applies to the omnibus clause; indictment timely (affirmed) |
| Admission of IRS witness testimony about other similar "zero" returns | Testimony that many similar returns appeared after Cracking the Code is relevant circumstantial evidence of Giambalvo’s good-faith belief | Such evidence is not probative of Giambalvo’s subjective belief because witness never had contact with him; irrelevant and confusing | Exclusion was not an abuse of discretion; defendant’s own testimony was the proper source for subjective belief |
| Admission of post-indictment amended returns / expert showing no tax deficiency | Evidence that Giambalvo actually owed no tax (and would have been due refunds) is material to good-faith, willfulness, and materiality defenses | Tax deficiency is not an element of § 7212(a) or § 7206(1); subsequently filed returns and post-hoc exculpatory acts have minimal probative value and are unfairly prejudicial | Exclusion was within district court’s discretion; absence of tax loss is irrelevant to guilt under these statutes |
| Whether the documents were "tax returns" and whether they were "filed" on the alleged date | Forms showing zeros are not bona fide tax returns as a matter of law; IRS internal records show different filing dates or no filing | The documents were labeled Form 1040, mailed and delivered to the IRS revenue officer on Jan. 26, 2011; § 7206(1) covers any "return, statement, or other document" signed under penalty of perjury | Sufficient evidence existed that the documents were the forms charged and were submitted/mailed on or about Jan. 26, 2011; motions for acquittal properly denied |
Key Cases Cited
- Cheek v. United States, 498 U.S. 192 (1991) (willfulness requires disproof of a defendant's subjective good-faith belief that tax law did not apply)
- Neder v. United States, 527 U.S. 1 (1999) (materiality defined as having natural tendency to influence decisionmaker)
- United States v. Marston, 517 F.3d 996 (8th Cir. 2008) (§ 7206(1) covers "return, statement, or other document" beyond narrow "tax return" definition in § 7203 context)
- United States v. Workinger, 90 F.3d 1409 (9th Cir. 1996) (parenthetical in § 6531(6) descriptive; six-year limit applies to § 7212(a) generally)
- United States v. Kassouf, 144 F.3d 952 (6th Cir. 1998) (same: § 6531(6) descriptive, six-year period applies)
- United States v. Kelly, 147 F.3d 172 (2d Cir. 1998) (rejecting argument that three-year limitation applies to omnibus clause)
- United States v. Yagow, 953 F.2d 423 (8th Cir. 1992) (discussing scope of "corruptly" under § 7212(a))
- United States v. Ellesfen, 655 F.3d 769 (8th Cir. 2011) (post‑discovery exculpatory acts have minimal probative value regarding state of mind)
- United States v. Boykoff, [citation="67 F. App'x 15"] (2d Cir. 2003) (application of § 6531(6) to § 7212(a) crimes)