12.20.2007

Fourth Circuit Weighs in on Split Re Meaning of Sentencing Guideline Provision

Per U.S. v. Delfino, --- F.3d ----, 2007 WL 4394412 (4th Cir. Dec. 18, 2007):

The jury found the Delfinos guilty on all counts. At sentencing, the Delfinos argued that the tax loss contained in the presentence report was erroneous because it did not credit them with the deductions which they could have claimed had they filed their tax returns. The district court rejected this argument and sentenced the Delfinos based on the tax loss calculated in the presentence report.

. . .

The Delfinos next look to U.S.S.G. § 2T1.1(c)(2)(A) for relief. Section 2T1.1(c)(2)(A) provides:

If the offense involved failure to file a tax return, the tax loss shall be treated as equal to 20% of the gross income ... less any tax withheld or otherwise paid, unless a more accurate determination of the tax loss can be made.

The Delfinos claim that the phrase “a more accurate determination of the tax loss” mandates the calculation of deductions before tax loss is determined. The three courts of appeals which have considered this issue have split, with a majority rejecting the position advanced by the Delfinos. Compare Chavin, 316 F.3d at 679 (rejecting the inclusion of deductions) and United States v. Spencer, 178 F.3d 1365, 1368 (10th Cir.1999) (same) with United States v. Gordon, 291 F.3d 181, 187 (2d Cir.2002) (concluding that § 2T1.1(c)(1)(A) requires the calculation of deductions). We agree with and adopt the majority view.

[Thanks to Sean Sirrine of www.objectivejustice.org for bringing this case to my attention.]

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