## Facts

- Donald L. Bowers and Janet E. Bowers filed federal income tax returns and paid taxes through tax year 1979.
- Beginning in 1980, they stopped filing returns and claimed “exempt” on W-4 forms to prevent employer withholding.
- After an IRS audit in 1982, they challenged assessments in Tax Court using theories including that they were not “persons” under the Internal Revenue Code and that wages were not taxable; the Tax Court upheld the assessments and imposed $6,500 in penalties for frivolous claims.
- Following an IRS levy on their bank accounts in March 1984, they closed their accounts and did not maintain accounts in their own names thereafter.
- To pay bills, they used postal money orders and used accounts in their minor sons’ names; they transferred title to their mobile home and vehicles to Mrs. Bowers’s mother.
- The government’s proof included that Donald evaded $8,069 in taxes and Janet evaded $12,758 for the charged years.
- At trial, the government introduced a computer-stored IRS compilation of certificates of assessments and payments, maintained on an IRS mainframe and sponsored by IRS employees.

## Issues

1. Whether alleged failure to publish certain IRS forms or materials under 5 U.S.C. § 552 barred prosecution or deprived the district court of jurisdiction.
2. Whether a computer-generated IRS compilation of assessments and payments was inadmissible hearsay.
3. Whether tax-protester theories (e.g., wages are not taxable; defendants are not “persons”; income tax is unconstitutional) could defeat criminal liability or negate willfulness for tax evasion.

## Decision

- The Fourth Circuit affirmed the convictions.
- The court rejected the argument that alleged APA publication defects barred enforcement of federal tax statutes or affected the district court’s jurisdiction.
- The court held the IRS computer compilation was admissible under the Federal Rules of Evidence as a record kept in the ordinary course of IRS operations (business and/or public records), notwithstanding computer storage.
- The court held the defendants’ tax-protester theories were frivolous and the evidence supported a finding of willfulness, including their shift from prior compliance to non-filing, litigation positions rejected in Tax Court, and post-levy steps to conceal assets and avoid collection.

## Legal Principles

- Federal criminal tax liability under the Internal Revenue Code is not defeated by claims that IRS forms or internal materials were not published in the Federal Register under 5 U.S.C. § 552.
- IRS records of assessments and payments, including computer-stored compilations, are admissible when properly authenticated and shown to be maintained as regular agency records under the business-records and/or public-records hearsay exceptions.
- Assertions that wages are non-taxable, that individuals are not “persons” under the Code, or that the income tax is unconstitutional are legally meritless and do not negate willfulness where conduct shows intentional evasion.

## Conclusion

The Fourth Circuit upheld the Bowerses’ convictions, concluding that APA nonpublication theories did not bar prosecution, IRS computer records were properly admitted to prove nonpayment, and the defendants’ conduct and rejected legal positions supported willful tax evasion.


United States v. Bowers, 920 F.2d 220 (4th Cir. 1990)