United States v. Storey, 640 F.3d 739

Storey, a physician in Maumee, Ohio, filed federal tax returns for 1994–1997 and 2000–2005 showing tax due but did not pay.
The United States filed suit in 2007 to reduce these taxes to judgment and foreclose its liens on Storey’s Morningdew Property (acquired 1994).
Storey had a 2002 Chapter 7 bankruptcy; the discharge petition did not initially determine the dischargeability of pre-petition tax debts.
The district court ruled that §523(a)(1)(C) excused discharge for taxes due to willful evasion, denying discharge for 1994–1997 and ordering judgment.
Storey appealed; the Sixth Circuit agreed to reverse, holding the United States failed to prove willful evasion; the case was remanded for proceedings consistent with the opinion.
A separate concurrence/dissent discussed whether facts from a related student-loan discharge matter could support willfulness and emphasized remand could be appropriate for fact development.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether 1994–1997 taxes were discharged in Storey’s 2002 bankruptcy.	Storey argued taxes were discharged under §523(a)(1)(C).	United States contends taxes were non-dischargeable due to willful evasion.	No discharge denial; government failed to prove willfulness.
Standard of review for the district court’s sua sponte summary-judgment-like order.	Storey challenged the district court’s procedure.	Government asserted proper legal ruling.	Review de novo; reversed for lack of willfulness evidence.
Mental-state element required for willful evasion.	Storey had a known duty to pay; argues no voluntary evasion.	Government argues evidence supports voluntary evasion, e.g., property purchase.	No genuine issue of material fact on willfulness; remand for further fact development.
Whether nonpayment alone suffices to establish willfulness.	Nonpayment, plus other conduct, could show willfulness.	Nonpayment alone is insufficient; requires voluntary evasion evidence.	Nonpayment alone insufficient; cannot sustain nondischargeable finding absent mental-state proof.

Stamper v. United States (In re Gardner), 360 F.3d 551 (6th Cir. 2004) (requires voluntary, conscious evasion to defeat discharge)
Grogan v. Garner, 498 U.S. 279 (1991) (dischargeability limits apply to honest debtor)
Meyers v. IRS (In re Meyers), 196 F.3d 622 (6th Cir. 1999) (nonpayment alone not enough; context matters)
Birkenstock, 87 F.3d 947 (7th Cir. 1996) (nonpayment paired with other factors may show willfulness)
Fretz, 244 F.3d 1323 (11th Cir. 2001) (discusses evidence of willful evasion with mental state)
Mitchell, 633 F.3d 1319 (11th Cir. 2011) (illustrates evaluating voluntary spending and intent)