The opinion of the court was delivered by: McMAHON, District Judge.
MEMORANDUM DECISION AND ORDER GRANTING GOVERNMENT'S
CROSS-MOTION FOR SUMMARY JUDGMENT AND DENYING PLAINTIFF'S MOTION
FOR SUMMARY JUDGMENT
Plaintiff also challenges the IRS's March 26, 1993 assessment
of a deficiency for the 1988 and 1989 tax years on the ground
that the IRS did not send the Notice of Deficiency to his
current address. Defendant is entitled to summary judgment on
this issue as well, because there is no dispute that the IRS
sent plaintiff the Notice of Deficiency to plaintiffs last-known
address and that plaintiff did indeed receive the Notice of
Finally, plaintiff challenges the IRS's levy of his personal
checking account, again claiming that the IRS failed to send him
notice to his current address. Plaintiff admits, however, that
he did not submit notice of a change of address to the IRS and
that he received actual notice of the levy from his bank prior
to its execution. Thus, summary judgment should be granted in
defendants' favor on this issue as well.
On April 17, 1989, plaintiff filed a federal income tax return
for the tax year ending on December 31, 1988. See Declaration
of Arnold B. Rifkin ("Rifkin Decl.") ¶ 5, Exhibit ("Ex.") A;
Declaration of Megan L. Brackney ("Brackney Decl.") Exhibit A
(Transcript of the May 22, 2002 deposition of Paul Hynard), at
7-9. On February 16, 1991 and December 14, 1991, plaintiff
submitted amended individual income tax returns (Form 1040X) for
the 1988 tax year. Rifkin Decl. Ex. B, C; Brackney Decl. Ex. A
at 11-14. On March 26, 1990, plaintiff filed a federal income
tax return for the tax year ending on December 31, 1989. Rifkin
Decl. Ex. J; Brackney Decl. Ex. A at 31. On November 1, 1990 and
on December 24, 1991, plaintiff filed amended individual tax
returns for 1989. Rifkin Decl. Ex. K and L; Brackney Decl. Ex. A
Plaintiffs December 14, 1991 amended tax return for 1988 and
plaintiffs December 24, 1991 amended tax return for 1989 list 10
Cherry Lane, Medford, New York, 11763-4084 as plaintiffs
address. Rifkin Decl. Ex. J and L. On March 26, 1993, the IRS
sent to plaintiff at 10 Cherry Lane, Medford, New York,
11763-4084 a Notice of Deficiency for the 1988 and 1989 tax
years. Rifkin Decl. Ex. P. Plaintiff admits to having received
the Notice of Deficiency in February 1994. Brackney Decl. Ex. B
(Complaint) at ¶ 5(n).
On September 1, 1994, plaintiff filed additional amended tax
returns for the 1988 and 1989 tax years. Rifkin Ex. D and M;
Brackney Decl. Ex. A at 18-19, 21-24. With the September 1, 1994
amended tax returns, plaintiff submitted a Schedule D form for
Capital Gains and Losses in which he claimed a $3,000 bad debt
deduction for each year. Id. In his September 1, 1994 amended
returns, plaintiff claimed that he was entitled to a $3000 bad
debt deduction for 1988 and 1989 because his step-brother, Vicha
Hynard, did not repay a $45,000 debt. Rifkin Decl. Ex. D, M.
Plaintiff claims that Vicha Hynard shot plaintiff and then
agreed to pay him $45,000 for having shot him. Brackney Decl.
Ex. A at 25-29. On April 26, 1987, Vicha Hynard signed a
"Assignment of Benefits" in which he agreed to assign the first
$45,000 of the "third division I receive in connection with the
Estate of my stepfather, Edward O. Hynard, to my stepbrother,
Paul Hynard, as and for the recovery of a debt to Paul, which I
hereby acknowledge." Rifkin Decl. Ex. E; Brackney Decl. Ex. A at
On June 12, 1992, Edward O. Hynard died. Rifkin Decl. Ex. I;
Brackney Decl. Ex. A at 28. Plaintiff testified that he learned
that he would not receive any money from the estate of Edward O.
Hynard sometime in 1994. Brackney Decl. Ex. A at 30. Plaintiff
further claims that Edward O. Hynard's estate was probated in
1998-1999. Id. Plaintiff claims that he did not receive any
distribution from Edward O. Hynard's estate and Vicha Hynard
never paid him $45,000. Id. at 28-30.
In August of 1998, the IRS sent a notice of levy to Astoria
Federal Savings & Loan and to plaintiff at P.O. Box 1102, Middle
Island, New York, 11763. Rifkin Decl. Ex. N. The Notice of Levy
notified plaintiff that a total of $9,504.48 representing due
and owing tax liability for 1988 and 1989 would be levied from
his bank account. Id. On August 27, 1998, plaintiffs bank,
Astoria Federal Savings and Loan Association, sent plaintiff a
copy of the Notice of Levy. Rifkin Decl. Ex. N and O; Brackney
Decl. Ex. A at 43-44. In August of 1998, plaintiff was
incarcerated at the Groveland Correctional Facility, but
plaintiff failed to notify the IRS that he was at a different
address. Brackney Decl. Ex. A at 45, 48-49.
On October 2, 1998, the IRS levied plaintiffs personal
checking account at Astoria Federal Savings and Loan in the
amount of $1,729.06 for unpaid taxes, interest, and penalties
for the 1988 tax year and $7,7175.42 for unpaid taxes, interest,
and penalties for the 1989 tax year. Rifkin Decl. at ¶¶ 15, 33.
Prior to filing this suit on November 7, 2001, plaintiff had
paid his full tax liability for the 1988 and 1989 tax years.
Rifkin Decl. ¶¶ 19, 37 (as of October 22, 2001, plaintiffs
accounts for 1988 and 1989 had a zero balance).
STANDARD FOR SUMMARY JUDGMENT
A party is entitled to summary judgment when there is no
"genuine issue of material fact" and the undisputed facts
warrant judgment for the moving party as a matter of law.
Fed.R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). In addressing a
motion for summary judgment, "the court must view the evidence
in the light most favorable to the party against whom summary,
judgment is sought and must draw all reasonable inferences in
[its] favor." Matsushita Elec. Indus. Co. Ltd. v. Zenith Radio
Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538
(1986). Whether any disputed issue of fact exists is for the
Court to determine. Balderman v. United States Veterans
Admin., 870 F.2d 57, 60 (2d Cir. 1989). The moving party has
the initial burden of demonstrating the absence of a disputed
issue of material fact. Celotex v. Catrett, 477 U.S. 317, 323,
106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once such a showing has
been made, the non-moving party must present "specific facts
showing that there is a genuine issue for trial." Fed.R.Civ.P.
56(e). The party opposing summary judgment "may not rely on
conclusory allegations or unsubstantiated speculation." Scotto
v. Almenas, 143 F.3d 105, 114 (2d Cir. 1998). Moreover, not
every disputed factual issue is material in light of the
substantive law that governs the case. "Only disputes over facts
that might affect the outcome of the suit under the governing
law will properly preclude summary
judgment." Anderson, 477 U.S. at 248, 106 S.Ct. 2505.
Applying this standard, plaintiffs motion for summary judgment
must be denied and defendants' cross-motion granted.
PLAINTIFF IS NOT ENTITLED TO A BAD DEBT DEDUCTION
Plaintiff appears to claim that he is entitled to a bad debt
deduction of $3,000 for the 1988 tax year and $3,000 for the
1989 tax year.*fn1 Brackney Decl. Ex. A at ¶¶ 5(a)-(g), 5(k),
6(a)-(d), Ex. B at 23-24, 36-38, 50-52; Rifkin Decl. Ex. D, M.
However, the undisputed facts show that plaintiff has failed to
establish the elements of either a business or a nonbusiness bad
debt under 26 U.S.C. § 166. Therefore, ...