Summary
A 44-year-old defense contractor was denied a security clearance under Guideline F, Financial Considerations, due to unresolved financial issues. The Statement of Reasons alleged eight delinquent medical debts totaling $2,198, and a failure to file or pay federal and state income taxes for tax years 2012 through 2015. These allegations raised disqualifying conditions under Adjudicative Guideline paragraphs 19(a), 19(c), and 19(g).
While the applicant mitigated several medical debts, the judge determined that significant security concerns remained unmitigated. Specifically, the applicant failed to timely file federal and state income tax returns for tax years 2012 through 2015. Furthermore, as of the record closing date, she had not provided proof of filing her state tax returns for 2015 and 2016.
Despite the application of mitigating conditions under Adjudicative Guideline paragraphs 20(b) and 20(d), the judge found the applicant's failure to timely file tax returns and her unresolved tax obligations substantial enough to warrant the denial of her security clearance.
Why the Applicant Was Denied
- The applicant failed to timely file federal and state income tax returns for tax years 2012 through 2015.
- The applicant did not provide proof of filing her state tax returns for 2015 and 2016 as of the record closing date.
- The applicant's financial issues raised significant security concerns that were not mitigated.
Conditions Referenced
- AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
- AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
- AG ¶ 19(g)raisedFailure to File Annual Federal, State, or Local Income Tax Returns as Required
- AG ¶ 20(b)rejectedConditions That Resulted in the Financial Problem Were Largely Beyond the Person’s ControlWhile the applicant faced several personal challenges, they did not fully mitigate the failure to file taxes.
- AG ¶ 20(d)appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant made payments towards medical debts and tax obligations.
Key Rule Quoted
“Failure to file tax returns suggests that an applicant has a problem with complying with well-established governmental rules and systems.”
Procedural Posture
- SOR issuedJun 30, 2017
- Answer filedAug 22, 2017
- Hearing heldApr 16, 2018
- Decision dateFeb 28, 2019
Cite For
- Failure to Timely File Tax Returns as a Disqualifying Condition Under Guideline F
- Mitigating Conditions Related to Financial Issues and Their Applicability
- The Importance of Compliance with Tax Obligations in Security Clearance Determinations