Section of Taxation Publications
  VOL. 59
NO. 1
FALL 2005
Contents | TTL Home


Note: The following is an excerpt from the introduction to the article as published in The Tax Lawyer. Author citations have been omitted for brevity. Tax Section members may read the article in its entirety in Adobe Acrobat format.


Donald E. Field

Inconsistency has pervaded recent judicial decisions that have analyzed whether the reasonableness of a taxpayer’s belief may be considered by a jury in its deliberations on “willfulness” in assessing a taxpayer’s good-faith defense to an allegation of tax evasion. In 2004, more than 1700 criminal investigations were initiated by the Service leading to 941 indictments and 657 convictions. Most violations of the Code are prosecuted under an assortment of criminal tax statutes with willfulness playing a key role in each. Consequently, courts are frequently faced with an array of good-faith defenses based on a taxpayer’s independent research into the Code, an attorney’s or accountant’s advice, or advice derived from tax seminars and presentations. In a recent decision involving willfulness, United States v. Pensyl, the Sixth Circuit held that a jury may consider the reasonableness of a taxpayer’s belief as a factor in determining whether a taxpayer actually held and acted upon that belief. Additionally, the court approved an instruction allowing the jury to consider the fact that a taxpayer’s belief may have been farfetched or unreasonable. The Sixth Circuit’s decision in Pensyl adds to the uncertainty and inconsistency that exists among circuit courts regarding proper jury instructions for a taxpayer’s good-faith defense to an allegation of tax evasion. Consequently, the extent to which a taxpayer’s subjective belief can be used in jury instructions to evaluate the willfulness element remains unsettled and requires clear resolution.

This Note is divided into five parts. Part II details the Sixth Circuit’s decision in Pensyl. Part III examines the historical foundation relied upon in tax evasion cases establishing the requirement to prove willfulness. Part IV evaluates the different approaches in interpreting and implementing the Supreme Court’s holding in Cheek v. United States, and Part V proposes a practical solution.    


Published by
Section of Taxation, American Bar Association
With the Assistance of
Georgetown University Law Center


If you are an ABA member, you can receive The Tax Lawyer and the Section NewsQuarterly, both quarterly publications, when you join the Section of Taxation. Anyone can subscribe to The Tax Lawyer by contacting the ABA Service Center.