State v. Eyre

2008 UT 16
AMENDED OPINION
This opinion is subject to revision before final
publication in the Pacific Reporter.
IN THE SUPREME COURT OF THE STATE OF UTAH
----oo0oo----
State of Utah, No. 20050664
Plaintiff and Appellee,
v.
F I L E D
Kevan Cliff Eyre,
Defendant and Appellant. February 22, 2008
---
Third District, Salt Lake
The Honorable Judith S. Atherton
No. 041900792
Attorneys: Mark L. Shurtleff, Att’y Gen., Mark W. Baer, Jeffrey
S. Gray, Asst. Att’ys Gen., Salt Lake City, for
plaintiff
Lori J. Seppi, Salt Lake City, for defendant
---
DURRANT, Justice:
INTRODUCTION
¶1 Defendant Kevan Eyre appeals his convictions on six
counts of felony tax evasion. Eyre argues that the State
presented insufficient evidence to support a conviction for tax
evasion by failing to prove the existence of a tax deficiency,
which Eyre asserts is a necessary element of the offense of tax
evasion. Eyre also argues that his trial counsel provided
ineffective assistance by making several missteps at trial. We
hold that the existence of a tax deficiency is an element of
Utah’s felony tax evasion statute. We also find that Eyre’s
trial counsel’s assistance was deficient and prejudicial to his
defense. Because of this ineffective assistance, we reverse
Eyre’s convictions for felony tax evasion and remand for a new
trial.

No. 20050664 2
BACKGROUND
¶2 Eyre failed to file Utah state income tax returns for
tax years 1991 through 1995. The Utah State Tax Commission (the
“Commission”) thereafter prepared and sent to him tax estimates
for each of those years, and in 1997 Eyre ultimately filed
returns for 1991, 1992, 1993, 1994, and 1995. But Eyre again
failed to file tax returns for tax years 1997 through 2002, and
the Commission initiated a criminal investigation. Eyre was
ultimately charged with six counts of failing to render a proper
tax return (“failure to file”), a third degree felony; six counts
of intending to defeat the payment of a tax (“tax evasion”), a
second degree felony; and one count of failing to obtain a
license to act as a dealer or salesperson of motor vehicles, a
misdemeanor.
¶3 At trial, the State presented evidence of Eyre’s gross
income for tax years 1997, 1998, 1999, 2000, 2001, and 2002.
During this period, Eyre received income from various sources:
residential rental properties; the sale of those rental
properties; the sale of various vehicles, boats, pianos, and
camper trailers; newspaper routes; and services he performed for
a law office. For each of these years, the State showed that
Eyre’s income exceeded the minimum amount of gross income for
which taxpayers were required to file a state income tax return.
The State also presented evidence that some of Eyre’s tenants
paid rent in cash, for which they did not receive receipts, and
that Eyre engaged in many other cash transactions, suggesting he
received more income than the Commission was able to verify in
its investigation. The State did not give Eyre credit for any
exemptions, deductions, or business losses because, according to
its expert witness, he was not entitled to them because he did
not file tax returns.
¶4 At the close of the State’s case in chief, Eyre moved
to dismiss for insufficient evidence, arguing that the State
offered “no direct evidence with regard to intent to evade the
payment of tax” and that he owed no taxes for any of the years in
question. The court denied the motion, stating that “there is
sufficient evidence in each of the counts to send this matter to
the jury.”
¶5 Eyre’s defense consisted primarily of the assertion
that he believed his deductions had outweighed his income for
each year, which would result in no tax liability, and that he
therefore did not fulfill the intent element of tax evasion.
Eyre’s trial counsel called Eyre to testify and attempted to
admit into evidence a document Eyre had prepared that summarized
Eyre’s finances and purported to show that he had no tax

3 No. 20050664
deficiency for each of the years in question. The State objected
to the document’s admission, arguing that it lacked foundation
and was thereby inadmissible. On voir dire, Eyre testified that
he had prepared the document from his own records over the
previous three days. Calling the document “unreliable,” the
court sustained the State’s objection. Having failed to admit
the document into evidence, trial counsel referred Eyre to the
summary sheet Eyre used to prepare the inadmissible document and
asked him to compare it to the Commission’s summary of his
income. Eyre testified that he had more income than the
Commission had identified but that he also had “lots” more
expenses, resulting in a loss for each of the charged years.
Eyre’s trial counsel failed to produce any of the documents on
which Eyre relied for his testimony and did not call an expert
witness to analyze or testify concerning Eyre’s tax status.
¶6 On cross-examination, the State questioned Eyre about a
prior felony conviction for making a false statement on an
application for an Idaho state fish and game license. Although
Eyre had previously filed a motion in limine to exclude his prior
conviction, which the court granted with respect to the State’s
case in chief, the trial court permitted the State to question
Eyre regarding his previous conviction for purposes of
impeachment. Eyre’s counsel mentioned the circumstances
surrounding the conviction in his opening statement and did not
object to the State’s cross-examination.
¶7 At the close of trial, the trial court instructed the
jury as to the elements of failure to file and tax evasion. For
tax evasion, the jury instructions read, in relevant part, as
follows:
Before you can convict the defendant,
Kevan Cliff Eyre, of the crime of Intent to
Defeat the Payment of a Tax, . . . you must
find from the evidence and beyond a
reasonable doubt, each and every one of the
following elements of that offense:
1. That the defendant intentionally
did, or willfully attempted to;
2. Evade or defeat the Utah State
income tax for year 1997 [and subsequent
years charged]; or
3. The payment of the Utah State income
tax for year 1997 [and subsequent years
charged].

No. 20050664 4
The trial court further instructed the jury that “[a] defendant
engages in conduct intentionally, or with intent or willfully,
with respect to the nature of the defendant’s conduct, or to a
result of the defendant’s conduct, when it is his conscious
objective or desire to engage in the conduct or cause the
result.” The trial court also instructed the jury that the State
“need not show . . . a precise amount or all of the tax due. The
State is only required to establish, beyond a reasonable doubt,
that the defendant intended to evade the payment of a tax, in
this case, Utah State Income Tax(es).” And the court instructed,
In order to show that the defendant “attempts
to evade or defeat any tax,” the State must
prove beyond a reasonable doubt that the
defendant intended to evade or defeat a tax
due, and that the defendant also willfully
did some affirmative act or willfully failed
to do some act required of him by law in
order to accomplish this intent to evade or
defeat a tax.
¶8 Eyre’s counsel did not object to any of the jury
instructions. The jury subsequently convicted Eyre on all counts
for failure to file and tax evasion and found him not guilty of
failure to obtain a license.
¶9 Eyre retained new counsel for the sentencing phase of
his trial and employed an expert to prepare his tax returns for
tax years 1997 through 2002. The expert used a “conservative
approach” in preparing Eyre’s returns, which showed no deficiency
for some of the charged years and a small deficiency for the
other years. The trial court imposed a fine of $2500 on Eyre and
sentenced him to concurrent prison terms of zero to five years on
each conviction for failure to file and consecutive prison terms
of one to fifteen years on each conviction for tax evasion. The
court then suspended the prison terms and placed Eyre on
probation. The State thereafter filed a motion to correct the
sentence, which the court granted. The court imposed the correct
fine of $15,000 on Eyre and suspended all but $2500 of it
contingent upon Eyre’s successful completion of probation. Eyre
now challenges his convictions on appeal.
ANALYSIS
¶10 Eyre urges us to reverse his convictions for tax
evasion on two general grounds. First, he argues that the State
failed to present sufficient evidence to prove that he had a tax
deficiency, which Eyre claims is a necessary element of tax
evasion, for each of the tax years in question. Second, he

1 See Peterson v. Sunrider Corp., 2002 UT 43, ¶ 15, 48 P.3d
918.
2 Eyre has also appealed his convictions for failure to file
a tax return, but in his briefs has not argued that a tax
deficiency is a necessary element of failure to file and has
otherwise failed to adequately support his assertion that his
failure to file convictions should be reversed. Accordingly, we
decline to review these convictions. See Ball v. Pub. Serv.
Comm’n (In re Questar Gas Co.), 2007 UT 79, ¶ 40, P.3d
(“We have consistently declined to review issues that are not
adequately briefed.”).
3 Utah Code Ann. § 76-8-1101(1)(d)(I) (2003 & Supp. 2007).
Although this statute has been amended slightly since the time
Eyre was charged, the changes are not relevant to our analysis.
4 Jensen v. State Tax Comm’n, 835 P.2d 965, 970 (Utah 1992).
5 No. 20050664
argues that his counsel rendered ineffective assistance. In the
analysis that follows, we first address whether a tax deficiency
is an element of tax evasion; this is a question of law that we
review for correctness.1 Because we agree with Eyre that a tax
deficiency is an element of tax evasion, we then consider Eyre’s
claim that his counsel was ineffective in failing to object to
the absence of a jury instruction identifying a tax deficiency as
an element of tax evasion.2
I. A TAX DEFICIENCY IS AN ELEMENT OF FELONY TAX EVASION UNDER
UTAH LAW
¶11 Utah’s felony tax evasion statute reads as follows:
“Any person who intentionally or willfully attempts to evade or
defeat any tax or the payment of a tax is, in addition to other
penalties provided by law, guilty of a second degree felony.”3
Although this statute does not use the words “tax deficiency,” it
is logical to conclude that, if no tax is owing, there is no tax
to evade. Utah’s tax laws “assess[] income tax only on adjusted
gross income, which is defined as all nonexempt income less
allowable deductions.”4 Thus, a person does not owe income tax
simply because he earned income. Rather, he owes income tax only
if a tax deficiency exists after his exempt income and allowable
deductions are subtracted from his gross income. To prevail on a
felony tax evasion claim, the State must therefore show that a
tax was, in fact, due and owing; merely establishing income does
not suffice.
¶12 We have required the Commission to prove the existence
of a deficiency when imposing a civil penalty on a taxpayer for

5 See id. at 970-71. The statutory basis for this penalty
is found in Utah Code section 59-1-401(7)(a), (b) (Supp. 2007).
6 Compare Utah Code Ann. § 59-1-401(7)(a), with id.
§ 59-1-401(12)(d)(I), and id. § 76-8-1101(1)(d)(I).
7 We respectfully disagree with Justice Wilkins’s suggestion
that our determination necessarily requires that a defendant
successfully evade a tax to be guilty of tax evasion. Our
holding requires only that a defendant evade--or attempt to
evade--a tax deficiency, in other words, a tax actually owing.
If a defendant has no tax deficiency, he has no tax to evade.
Where the State can show a tax deficiency, both successful and
unsuccessful attempts to evade that tax are subject to penalty
under Utah’s tax evasion statute.
We also emphasize that the State need not show a tax
deficiency with precision. Rather, the State need only show that
a tax was, in fact, owing. Although a de minimis tax deficiency
may be sufficient to meet this requirement, we caution that the
State may have difficulty proving the intent element of tax
evasion without a greater showing.
8 See Lawn v. United States, 355 U.S. 339, 361 (1958) (“[A]
conviction upon a charge of attempting to evade assessment of
income taxes by the filing of a fraudulent return cannot stand in
the absence of proof of a deficiency . . . .”).
9 26 U.S.C. § 7201 (2000).
No. 20050664 6
“intent to evade a tax.”5 It would be inconsistent to require
such a showing for a lesser civil offense that carries only a
monetary penalty while not requiring the same showing for a
criminal violation that carries a prison sentence.6 Thus, we
hold that the existence of a tax deficiency is an element of
felony tax evasion under Utah law.7
¶13 We find it persuasive that the federal courts have
interpreted the federal tax evasion statute, the wording of which
is similar to our statute, to require the government to show a
tax deficiency.8 Like our statute, the federal statute does not
explicitly reference a tax deficiency. The federal statute reads
as follows: “Any person who wilfully attempts in any manner to
evade or defeat any tax imposed by this title or the payment
thereof shall, in addition to other penalties provided by law, be
guilty of a felony . . . .”9 Because the wording of the Utah
statute is almost identical to that of the federal statute, it is

10 The other elements of the federal tax evasion statute are
“willfulness” and “an affirmative act constituting an evasion or
attempted evasion of the tax.” Sansone v. United States, 380
U.S. 343, 351 (1965).
11 26 U.S.C. § 7201 (emphasis added).
12 Utah Code Ann. § 76-8-1101(1)(d)(i) (2003 & Supp. 2007).
13 Strickland v. Washington, 466 U.S. 668, 687 (1984).
7 No. 20050664
reasonable to conclude that the statutes should require the same
elements, including the showing of a tax deficiency.10
¶14 We recognize that the federal statute speaks of “any
tax imposed by this title”11 while the Utah statute speaks only
of “any tax”12 and does not directly reference the tax laws under
which the evaded tax is imposed. We think it is necessarily
implicit in our statute that the tax spoken of is a tax imposed
by law. If a tax is not a tax imposed by law, it is not a tax at
all. Thus, evading any “tax” under the language of the Utah
statute is substantively no different than evading a “tax imposed
by law” under the federal statute. Where the Utah statute and
the federal statute are otherwise identical, there is no reason
to draw a distinction based on language explicit in the federal
statute that is implicit in ours.
¶15 We hold that proof of a tax deficiency is an element of
Utah’s tax evasion statute. In light of this holding, we
consider Eyre’s claim that his counsel was ineffective for
failing to object to the absence of a jury instruction
identifying a tax deficiency as an element of tax evasion. And
as we explain in the following section, Eyre’s counsel was
ineffective in this regard. Because of this ineffectiveness, the
question of whether Eyre had a tax deficiency was not submitted
to the jury. Accordingly, we remand for a new trial.
II. EYRE’S TRIAL COUNSEL RENDERED INEFFECTIVE ASSISTANCE
¶16 Whether Eyre’s counsel rendered ineffective assistance
is a determination governed by the two-part Strickland test,
which requires the defendant to show both “that counsel’s
performance was deficient” and “that the deficient performance
prejudiced the defense.”13 An attorney’s performance is
deficient if “counsel made errors so serious that counsel was not
functioning as the ‘counsel’ guaranteed the defendant by the

14 Id.
15 Id. at 688.
16 Id. at 690.
17 Id. at 691-92.
18 Id.
19 Id. at 693.
20 Id. at 694.
21 Id.
No. 20050664 8
Sixth Amendment.”14 The seriousness of those errors is measured
by whether “counsel’s representation fell below an objective
standard of reasonableness.”15 Specifically, “[a] convicted
defendant . . . must identify the acts or omissions of counsel
that are alleged not to have been the result of reasonable
professional judgment.”16
¶17 In addition to demonstrating his counsel’s
deficiencies, the Strickland standard requires that a defendant
also show that those deficiencies affected the outcome of the
proceeding.17 Because “[t]he purpose of the Sixth Amendment
guarantee of counsel is to ensure that a defendant has the
assistance necessary to justify reliance on the outcome of the
proceeding . . . any deficiencies in counsel’s performance must
be prejudicial to the defense in order to constitute ineffective
assistance under the Constitution.”18 Thus, “[i]t is not enough
for the defendant to show that the errors had some conceivable
effect on the outcome of the proceeding.”19 Rather, “[t]he
defendant must show that there is a reasonable probability that,
but for counsel’s unprofessional errors, the result of the
proceeding would have been different.”20 This “reasonable
probability is a probability sufficient to undermine confidence
in the outcome.”21
¶18 In this case, Eyre claims that his trial counsel
rendered ineffective assistance in four ways: first, by failing
to object to the absence of a jury instruction listing the
existence of a tax deficiency as an element of tax evasion;
second, by failing to object to the instructions defining
“intentionally and willfully attempts to evade”; third, by
failing to examine Eyre effectively or call an expert witness;
and fourth, by failing to object to the State’s cross-examination
of Eyre regarding a prior conviction. We find it necessary to
address only the first of these four claims.

9 No. 20050664
¶19 Eyre’s counsel did not object to the jury instruction
that omitted the existence of a tax deficiency as an element of
tax evasion. Because a tax deficiency is an element of tax
evasion, counsel’s failure to object to a jury instruction that
did not alert the jury to every element of the crime with which
his client was charged amounted to a deficient performance. And
this deficiency prejudiced Eyre. Eyre’s defense at trial was
that he failed to file his tax returns, not because he was trying
to evade a tax but rather because he did not believe he had any
tax due and owing. Had the jury been instructed properly, they
could have made a determination regarding the State’s proof of a
tax deficiency and the plausibility of Eyre’s defense. Even
where the State may have been able to prove that a tax was due
and owing, that tax may have been small enough that the jury
could have found that Eyre in good faith believed that he did not
have a tax deficiency and did not file as a result. The
probability of this result is sufficient to undermine our
confidence in the verdicts rendered by the jury.
¶20 Based on our conclusion that Eyre’s counsel rendered
ineffective assistance in failing to object to the jury
instruction that omitted the requirement that a tax deficiency be
shown, we reverse his convictions for tax evasion and remand for
a new trial. Accordingly, it is unnecessary for us to consider
his other three claims of ineffective assistance of counsel.
CONCLUSION
¶21 We hold that the existence of a tax deficiency is a
necessary element of the offense of tax evasion under Utah’s
statute. As a result, we find that Eyre’s counsel was
ineffective in failing to object to a jury instruction defining
the elements of tax evasion that did not include the existence of
a tax deficiency. Based on counsel’s ineffective assistance, we
reverse Eyre’s convictions on all six counts of tax evasion and
remand for a new trial. Eyre failed to adequately brief his
appeal of his convictions on six counts of failure to file. For
this reason, we affirm those convictions.
---
¶22 Chief Justice Durham, Justice Parrish, and Justice
Nehring concur in Justice Durrant’s opinion.
---
WILKINS, Associate Chief Justice, dissenting:

No. 20050664 10
¶23 I do not believe that a tax deficiency is a necessary
element of tax evasion. I also do not believe that Eyre’s
initial counsel provided ineffective assistance at trial.
Accordingly, I respectfully dissent.
¶24 The Utah tax evasion statute states that: “Any person
who intentionally or willfully attempts to evade or defeat any
tax or the payment of a tax is, in addition to other penalties
provided by law, guilty of a second degree felony.” Utah Code
Ann. § 76-8-1101(1)(d)(i) (2003 & Supp. 2007). The legislature,
in the plain language of the statute, did not mention proof of a
tax deficiency as an element of the crime. By adding such a
requirement, my colleagues today eliminate from the scope of the
statute nearly any unsuccessful criminal who tries, but fails, to
defeat or evade a tax obligation.
¶25 The statute applies to anyone who “intentionally or
willfully attempts to evade or defeat any tax.” Id. (emphasis
added). Successful evasion is not required for prosecution under
the statute. All that is required is that the state show that
the defendant intentionally attempted to evade a tax, not that
the attempt was successful in whole or in part. The purpose of
the statute is to criminalize the conduct of tax evasion (or the
attempt), not to examine the result of the conduct (i.e., an
actual tax deficiency).
¶26 In contrast, a civil tax enforcement proceeding, the
purpose of which is to recover unpaid taxes, is concerned with
the result of tax evasion. See, e.g., United States v. Williams,
875 F.2d 846, 851 (11th Cir. 1989) (distinguishing the purposes
of and the rules that apply to civil and criminal tax
proceedings). To recover unpaid taxes, the state must prove the
existence and amount of a tax deficiency. See Jensen v. State
Tax Comm’n, 835 P.2d 965, 970-71 (Utah 1992). However, requiring
the state to establish a deficiency in the criminal context
unnecessarily restricts the scope of the action to only those
whose actions were at least in part successful in evading the
payment of tax. Those whose attempt was unavailing must escape
prosecution, as must those who are so successful that the level
of success cannot be determined. Surely this is not what the
legislature intended.
¶27 Civil and criminal tax enforcement schemes are not
hierarchical; rather, they are directed towards different ends,
and thus an element that is necessary in one context need not be
interlineated into the other based solely on their related
subject matter. To do so here, my colleagues not only rewrite
the statutory language, they modify the legislative purpose by
narrowing its scope dramatically. That is contrary to our
responsibility.

11 No. 20050664
¶28 Finally, the majority notes that federal case law has
required proof of a tax deficiency in a similar statute. I am
unpersuaded that this is a sufficient reason to graft a similar
requirement into an otherwise clearly stated state statute.
¶29 Consequently, I would hold that proof of a tax
deficiency is not a required element of criminal tax evasion
under our statute, and dissent from the court’s holding on that
issue. Moreover, Eyre’s claim that his trial counsel was
ineffective is predicated on counsel’s failure to object to the
absence of a jury instruction on the “required” element of tax
deficiency. Because proof of a tax deficiency is not an element
of tax evasion, in my view, Eyre’s trial counsel was not
ineffective in failing to object. I therefore also disagree with
my colleagues on the ineffective assistance of counsel claim.
¶30 Under the standard in Strickland v. Washington, 466
U.S. 668 (1984), Eyre must show that the ineffective assistance
of his trial counsel prejudiced the defense. I do not believe
that Eyre has met this burden with respect to any of the four
alleged deficiencies he has raised.
¶31 I would affirm.
---