depart from the United States or to otherwise conceal himself or herself; (2) whether the taxpayer is or appears to be designing to place his or her property beyond the reach of the government either by removing it from the United States, or by concealing it or transferring it to other persons; or (3) whether the taxpayer's financial solvency appears to be imperiled. Perillo, supra, at 85,479 citing Cantillo v. Coleman, 559 F. Supp. 205, 207 (D.N.J. 1983).
Here, the government contends that the plaintiffs were or appeared to be designing quickly to place themselves and/or their assets beyond the reach of the IRS. Were this court to consider only the information available to the IRS agent at the time the assessment decision was made, this court would have little difficulty concluding that the assessment was reasonable. However, considering all evidence available to date, this court finds that the assessment was not reasonable.
First, much of the information in the IRS declaration has been refuted by several credible declarations submitted by the plaintiffs. More importantly, several infirmities in the IRS declaration cast doubt on the overall probative value of the document.
For example, the IRS agent relied on the statement of an unnamed neighbor and alleged that the taxpayers "may have sold the major known asset, the residence on Greenwood Drive." This assertion is incorrect. This court has been provided with the affidavit of a vice president of a title company which establishes that the individual taxpayers are the owners of the Bonita house. The taxpayers owned the house at the time of the jeopardy assessments and currently own the house.
What is most troublesome to this court is that this is an easily discoverable fact: an IRS agent need only check with the County Recorder's Office to uncover such information.
Also, IRS allegations that Carrillo-Barron held a "green card" with No. 4781707 is incorrect. In fact, Carrillo-Barron owned a nonresident alien border crossing card, No. 4781707, a copy of which has been attached as an exhibit to his declaration.
Because of his nonresident status, Carrillo-Barron was not required to obtain a Certificate of Compliance for departing aliens. Treas. Reg. § 1.6851-2(a)(2)(d). Moreover, Carrillo-Barron asserts, by way of affidavit, that he was advised by his accountants that he was a nonresident alien for income tax purposes, and as such, he was under no requirement to file United States income tax returns.
Further, the Carrillos' marriage certificate, which has been presented to this court as an exhibit, evidences an agreement to treat any property acquired during the marriage as separate property. Thus, it appears that Norma Fregoso Carrillo at no time earned income in an amount requiring her to file a United States income tax return.
By way of a bank manager's affidavit, the plaintiffs have refuted IRS allegations that they provided a bank with a false taxpayer identification number. Also, plaintiff Carrillo-Barron admits to filing W-8 Forms, but claims that he did this on the advice of investment firms, and did not intend to conceal the accounts from the IRS. Plaintiff has attached as an exhibit the information he received from the investment firms. Moreover, by way of several credible declarations, plaintiffs have established that they began building a home in Tijuana, Mexico in late 1984, and moved in upon completion in late 1987. The Carrillos resided at all times after December 1987 in Mexico.
Finally, plaintiffs have again showed, by way of trustworthy declarations, that Stebco was not designing to place its property beyond the reach of the IRS. Selling properties was part of Stebco's business, but at the time of the jeopardy assessment, Stebco held at least six parcels of real property with a cost of over $ 1,400,000 and a net fair market value of between $ 2,500,000 and $ 3,000,000. The IRS has presented no evidence that Stebco was attempting to sell this property quickly or at a loss. See Penner v. United States, 582 F. Supp. 432, 435 (1984). There are no mortgages, deeds of trust, or other liens on these properties (other than possible IRS liens imposed as a result of these proceedings).
While plaintiffs acknowledge that Stebco's 1988 corporate income tax return was filed late, they assert that much of the delay was caused by the imposition of the jeopardy assessments. The government does not dispute that all prior tax returns were timely filed.
In sum, the government has not carried its burden of showing that the plaintiffs were or appeared to be designing to quickly place themselves and/or their assets beyond the reach of the IRS. The plaintiffs have submitted evidence that they own a house and parcels of real property in the area, the total value of which exceeds the amount of the government's lien. Assuming that the property is of the value stated and is free from encumbrances, the jeopardy assessment is not reasonable to protect the interests of the IRS. See Perillo, supra, at 85,479. It is hereby ordered that the jeopardy assessment imposed upon the plaintiffs be abated.
IT IS SO ORDERED.
Dated: March 12, 1990