Summary
A 46-year-old defense contractor employee was denied a security clearance under Guideline F, Financial Considerations, due to unresolved tax issues. The Statement of Reasons alleged that the applicant failed to file federal income tax returns for 2016, 2017, and 2018, and owed approximately $12,868 in unpaid federal income taxes from 2015. The applicant acknowledged these continuing tax issues but failed to take action to resolve them.
Disqualifying conditions under Guideline F were raised, specifically AG ¶ 19(a), AG ¶ 19(b), AG ¶ 19(c), and AG ¶ 19(f). While mitigating conditions AG ¶ 20(b), AG ¶ 20(d), and AG ¶ 20(g) were applied, they were insufficient to overcome the security concerns.
The denial was based on the applicant's failure to file the specified tax returns, the outstanding tax debt from 2015, and the lack of demonstrated good-faith effort to resolve these financial problems. The judge concluded that these issues raised concerns about the applicant's reliability and trustworthiness.
Why the Applicant Was Denied
- The applicant failed to file federal income tax returns for 2016, 2017, and 2018.
- The applicant owed approximately $12,868 in unpaid federal income taxes from 2015.
- The applicant did not provide evidence of a good-faith effort to resolve her financial issues.
Conditions Referenced
- AG ¶ 19(a)raisedInability to Satisfy Debts
- AG ¶ 19(b)appliedUnwillingness to Satisfy Debts Regardless of the Ability to Do So
- AG ¶ 19(c)appliedHistory of Not Meeting Financial Obligations
- AG ¶ 19(f)appliedFailure to File or Fraudulently Filing Annual Federal, State, or Local Income Tax Returns or Failure to Pay Annual Federal, State, or Local Income Tax as Required
- AG ¶ 20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person's Control
- AG ¶ 20(d)rejectedIndividual Initiated and Is Adhering to a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant failed to demonstrate a good-faith effort to resolve her financial issues.
- AG ¶ 20(g)rejectedIndividual Has Made Arrangements with the Appropriate Tax Authority to File or Pay the Amount Owed and Is in Compliance with Those ArrangementsThe applicant did not provide evidence of arrangements made with tax authorities.
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 issuedApr 13, 2020
- Answer filedJun 15, 2020Applicant elected to have her case decided on the written record.
- Hearing held—No hearing; case decided on the written record.
- Decision dateNov 10, 2020
Cite For
- Failure to File Tax Returns as a Disqualifying Condition Under Guideline F
- Lack of Good-faith Effort to Resolve Financial Issues as a Basis for Denial
- Importance of Compliance with Governmental Rules in Security Clearance Evaluations