Summary
A 61-year-old male applicant with a military background was denied a security clearance under Guideline F (Financial Considerations) due to unresolved financial issues. The Statement of Reasons alleged that the applicant failed to timely file federal income tax returns for the years 2008-2010, 2012-2014, and 2017, and owed approximately $21,000 in federal taxes. The applicant admitted these failures in his interrogatory responses, Answer, and hearing testimony.
Disqualifying conditions F.19.c and F.19.f were raised, while mitigating conditions F.20.a, F.20.b, F.20.c, F.20.d, and F.20.g were applied. However, the judge ultimately found significant concerns regarding the applicant's reliability and trustworthiness.
The denial was based on the applicant's failure to file federal tax returns for multiple years and his inability to pay approximately $21,000 in federal taxes, primarily from tax year 2006. Furthermore, the applicant did not provide sufficient evidence of good-faith efforts to resolve his tax issues, including a failure to adhere to installment payment agreements with the IRS.
Why the Applicant Was Denied
- The applicant failed to file federal tax returns for multiple years, including 2008-2010, 2012-2014, and 2017.
- The applicant owed approximately $21,000 in federal taxes, primarily from tax year 2006, which he has been unable to pay.
- The applicant did not provide sufficient evidence of good-faith efforts to resolve his tax issues, including failure to adhere to installment payment agreements with the IRS.
Conditions Referenced
- F.19.craisedA History of Not Meeting Financial Obligations
- F.19.fraisedFailure 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
- F.20.arejectedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to Recur and Does Not Cast Doubt on the Individual's Current Reliability, Trustworthiness, or Good JudgmentThe applicant's pattern of failing to file tax returns and pay taxes indicates ongoing issues.
- F.20.brejectedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person's ControlWhile homelessness was a factor, the applicant's admitted irresponsibility was within his control.
- F.20.crejectedThe Individual Has Received or Is Receiving Financial Counseling for the Problem From a Legitimate and Credible SourceThere is no evidence of financial counseling.
- F.20.drejectedThe Individual Initiated and Is Adhering to a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant failed to demonstrate a consistent good-faith effort to resolve his tax obligations.
- F.20.grejectedThe Individual 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 comply with the IRS payment plan.
Key Rule Quoted
“Failure to live within one’s means, satisfy debts, and meet financial obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which can raise questions about an individual’s reliability, trustworthiness, and ability to protect classified or sensitive information.”
Procedural Posture
- SOR issuedJun 26, 2019
- Answer filed—Undated response to SOR.
- Hearing heldSep 23, 2019Hearing convened as scheduled.
- Decision dateNov 6, 2019
Cite For
- Denial of Security Clearance Due to Unresolved Financial Issues Under Guideline F
- Failure to File Tax Returns as a Disqualifying Condition
- Lack of Good-faith Efforts to Resolve Financial Obligations as a Basis for Denial