ORDERS:
FINAL ORDER ON MOTION FOR SUMMARY JUDGMENT
This matter is before me pursuant to the South Carolina Department of Revenue's
(Department) Motion for Summary Judgment against the Petitioner as to the tax liability on $90,000
embezzled by his wife. This Motion is premised on the following facts.
In November 1997, the Department issued a Final Agency Determination against the
Petitioner and his wife. Such determination assessed tax, interest, and penalties for their failure to
report $464,820.91 embezzled by Petitioner's wife on their joint income tax returns for the tax years
1986 through 1991. The amount embezzled had been previously determined by the General Sessions
Court, the South Carolina Court of Appeals, and the South Carolina Supreme Court.
Petitioner and his wife timely requested a hearing before the Administrative Law Judge
Division (ALJD) on the issue of the amount embezzled. They filed a Petition with the ALJD dated
January 12, 1998, seeking an order that their tax liability arising from the embezzlement be limited
to $90,000.
The Department subsequently filed a Motion for Summary Judgment against Petitioner's
wife asserting that she was collaterally estopped from challenging the amount embezzled. Summary
judgment was granted estopping her from contesting the amount embezzled. Collateral estoppel was
not requested and could not be maintained against Petitioner because he was not a party to the
criminal proceedings which determined this liability.
Following this Court's decision to grant summary judgment against Petitioner's wife,
Petitioner indicated through his attorney that he would like to work out a payment agreement with
the Department rather than proceeding to a hearing regarding his liability. As of this date, Petitioner
has never contacted the Department to arrange for a payment agreement and has failed to respond
to any of the Department's inquiries in this regard.
Based upon the above facts, I find as follows:
(1) that Petitioner admitted in the January 12, 1998, Petition that his wife embezzled
$90,000 and requested that the tax liability be based on that amount;
(2) that Petitioner and his wife filed joint income tax returns for the years in question and
are, therefore, jointly and severally liable for any amounts due pursuant to S.C. Code Ann. § 12-6-40
(Supp. 1998) and IRC § 6013(d)(3).
Accordingly, it is hereby,
ORDERED that the Department's Motion for Summary Judgment against Petitioner
assessing tax, interest, and penalty on embezzled funds totaling $90,000 is granted.
AND IT IS SO ORDERED.
Marvin F. Kittrell
Chief Judge
Columbia, South Carolina
February 3, 1999 |
