Cobb v. United States, Department of Internal Revenue Service (In Re Cobb)

D. Nebraska

Cobb v. United States, Department of Internal Revenue Service (In Re Cobb)

135 B.R. 640, 1992 Bankr. LEXIS 31, 22 Bankr. Ct. Dec. (CRR) 823

CourtUnited States Bankruptcy Court, D. Nebraska

DecidedJanuary 9, 1992

Docket16-81484

StatusPublished

Cited by9 cases

This text of 135 B.R. 640 (Cobb v. United States, Department of Internal Revenue Service (In Re Cobb)) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, D. Nebraska primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Cobb v. United States, Department of Internal Revenue Service (In Re Cobb), 135 B.R. 640, 1992 Bankr. LEXIS 31, 22 Bankr. Ct. Dec. (CRR) 823 (Neb. 1992).

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Opinion

MEMORANDUM

JOHN C. MINAHAN, Jr., Bankruptcy Judge.

The issue before the court is whether the Internal Revenue Service or debtor have the burden of proof with respect to federal income tax liabilities.

In reliance on Bankruptcy Rule 3001(f), debtor contends that the Internal Revenue Service has the burden of ultimate persuasion. The Internal Revenue Service relies on non-bankruptcy law under which it is generally established that the burden of proof is upon a taxpayer. United States v. Janis, 428 U.S. 433, 96 S.Ct. 3021, 49 L.Ed.2d 1046 (1976), Bull v. United States, 295 U.S. 247, 55 S.Ct. 695, 79 L.Ed. 1421 (1935), Sinder v. United States, 655 F.2d 729 (6th Cir.1981). I conclude that the burden of proof rests upon the taxpayer notwithstanding Bankruptcy Rule 3001(f).

Two recent cases conclude that Bankruptcy Rule 3001(f) shifts the burden of proof to the Internal Revenue Service. See In re Premo, 116 B.R. 515 (Bkrtcy.E.D.Mich.1990), and Fidelity Holding Co., Ltd. v. The Official Creditors’ Committee, 837 F.2d 696 (5th Cir.1988). Collier appears to also conclude that once the debtor “carries the burden of going forward to meet, overcome, ... the proof of claim,” the burden shifts to the claimant. See *641 § 502(a), Collier on Bankruptcy, ¶ 502.-1[3] 15th Ed.1989. I respectively disagree with this growing weight of authority and conclude that the burden of proof with respect to tax claims is not shifted as a result of Bankruptcy Rule 3001(f).

Bankruptcy Rule 3001(f) does not, in a technical sense, allocate burden of proof. The Rule simply establishes that a proof of claim constitutes evidence. Cf. Whitney v. Dresser, 200 U.S. 532, 26 S.Ct. 316, 50 L.Ed. 584 (1906). The Rule, in effect, creates a presumption which must be overcome by debtor. Once the presumption of Bankruptcy Rule 3001(f) is overcome, the proof of claim no longer constitutes evidence — the bubble is burst. The burden of proof is to then be allocated by applicable non-bankruptcy law. Cf. Fed.R.Evid. 301. In the case of tax claims, the burden of proof and persuasion is upon the taxpayer. See, United States v. Janis, supra. Bankruptcy Rule 3001(f) does not shift the burden to the IRS.

To rule otherwise would permit a tax litigant to shift the burden of proof to the Internal Revenue Service by filing bankruptcy.

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MEMORANDUM

JOHN C. MINAHAN, Jr., Bankruptcy Judge.

The issue before the court is whether the Internal Revenue Service or debtor have the burden of proof with respect to federal income tax liabilities.

In reliance on Bankruptcy Rule 3001(f), debtor contends that the Internal Revenue Service has the burden of ultimate persuasion. The Internal Revenue Service relies on non-bankruptcy law under which it is generally established that the burden of proof is upon a taxpayer. United States v. Janis, 428 U.S. 433, 96 S.Ct. 3021, 49 L.Ed.2d 1046 (1976), Bull v. United States, 295 U.S. 247, 55 S.Ct. 695, 79 L.Ed. 1421 (1935), Sinder v. United States, 655 F.2d 729 (6th Cir.1981). I conclude that the burden of proof rests upon the taxpayer notwithstanding Bankruptcy Rule 3001(f).

Two recent cases conclude that Bankruptcy Rule 3001(f) shifts the burden of proof to the Internal Revenue Service. See In re Premo, 116 B.R. 515 (Bkrtcy.E.D.Mich.1990), and Fidelity Holding Co., Ltd. v. The Official Creditors’ Committee, 837 F.2d 696 (5th Cir.1988). Collier appears to also conclude that once the debtor “carries the burden of going forward to meet, overcome, ... the proof of claim,” the burden shifts to the claimant. See *641 § 502(a), Collier on Bankruptcy, ¶ 502.-1[3] 15th Ed.1989. I respectively disagree with this growing weight of authority and conclude that the burden of proof with respect to tax claims is not shifted as a result of Bankruptcy Rule 3001(f).

Bankruptcy Rule 3001(f) does not, in a technical sense, allocate burden of proof. The Rule simply establishes that a proof of claim constitutes evidence. Cf. Whitney v. Dresser, 200 U.S. 532, 26 S.Ct. 316, 50 L.Ed. 584 (1906). The Rule, in effect, creates a presumption which must be overcome by debtor. Once the presumption of Bankruptcy Rule 3001(f) is overcome, the proof of claim no longer constitutes evidence — the bubble is burst. The burden of proof is to then be allocated by applicable non-bankruptcy law. Cf. Fed.R.Evid. 301. In the case of tax claims, the burden of proof and persuasion is upon the taxpayer. See, United States v. Janis, supra. Bankruptcy Rule 3001(f) does not shift the burden to the IRS.

To rule otherwise would permit a tax litigant to shift the burden of proof to the Internal Revenue Service by filing bankruptcy.

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135 B.R. 640, 1992 Bankr. LEXIS 31, 22 Bankr. Ct. Dec. (CRR) 823, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cobb-v-united-states-department-of-internal-revenue-service-in-re-cobb-nebraskab-1992.

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