United States of America v. Andre Helms, as Administrator of the Estate of Tony J. Helms

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
ANDRE HELMS, as Administrator of the
Estate of Tony J. Helms,
Defendant - Appellant.
No. 11-56988
D.C. No. 3:08-cv-00151-JLS-NLS
MEMORANDUM*
Appeal from the United States District Court
for the Southern District of California
Janis L. Sammartino, District Judge, Presiding
Submitted March 4, 2014 **
Pasadena, California
Before: FERNANDEZ and GRABER, Circuit Judges, and ZOUHARY,*** District
Judge.
FILED
JUN 18 2014
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
* This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
** The panel unanimously concludes this case is suitable for decision
without oral argument. Fed. R. App. P. 34(a)(2).
*** The Honorable Jack Zouhary, United States District Judge for the
Northern District of Ohio, sitting by designation.

-- 1 of 3 --

Defendant Estate of Tony J. Helms, the taxpayer who is now deceased,
appeals the district court’s grant of summary judgment in favor of the government.
Reviewing de novo, Holmes v. Merck & Co., 697 F.3d 1080, 1082 (9th Cir. 2012),
we affirm.
1. The district court did not err by shifting the burden of proof to
Defendant and affording the assessments a presumption of correctness. Rapp v.
Comm‘r, 774 F.2d 932, 935 (9th Cir. 1985). In the district court, Defendant failed
to dispute that the government carried its initial burden under Palmer v.
Commissioner, 116 F.3d 1309, 1312 (9th Cir. 1997), so that issue is waived. See
O’Guinn v. Lovelock Corr. Ctr., 502 F.3d 1056, 1063 n.3 (9th Cir. 2007) (holding
that arguments not raised before the district court generally are waived).
Moreover, Defendant’s challenge to the government’s use of the bank records
method to calculate its assessments is squarely foreclosed by our precedent. See
Choi v. Comm’r, 379 F.3d 638, 639–40 (9th Cir. 2004) (upholding the bank
records method of assessment as reasonable).
2. No genuine issue of fact exists as to whether the assessments were
arbitrary, excessive, or without foundation. Palmer, 116 F.3d at 1312. First, the
record shows that the government properly assessed certain funds as income, and
Defendant failed to provide clear evidence in support of his contention that the
2

-- 2 of 3 --

funds were loans. Defendant’s declaration is insufficient by itself to create a
genuine issue of material fact. Hexcel Corp. v. Ineos Polymers, Inc., 681 F.3d
1055, 1063–64 (9th Cir. 2012). Second, the district court struck Defendant’s
proffered evidence in support of his contention that the government erred by
recording certain deposits twice, and Defendant does not challenge that order on
appeal. Third, Defendant’s evidence in support of his contention that the
government failed to account properly for certain business deductions failed to
meet statutory standards of recordkeeping. See 26 U.S.C. §§ 162(a), 274(d).
Fourth, Defendant failed to provide sufficient evidence that the employment taxes
paid were not penalties, which are not deductible. See id. § 162(f). Fifth, with
respect to his asserted deduction for interest paid on business loans, Defendant did
not provide evidence that the loans in question were for business purposes and
were not personal loans. See 26 C.F.R. § 1.163-9T(a) (disallowing a deduction for
interest paid on personal loans). Finally, Defendant failed to establish ownership
of the real properties as to which he claimed deductions as a real estate business
expense, because he granted title to the properties to a third party.
AFFIRMED.
3

-- 3 of 3 --