Summary
A 44-year-old supply technician, employed by a Department of Defense contractor, was denied a security clearance under Guideline F (Financial Considerations) due to unresolved financial issues, primarily a failure to file federal and state tax returns for multiple years.
The Statement of Reasons detailed several financial concerns, including a $1,930 judgment filed against the applicant in September 2011 and a state tax lien for $625 in November 2011. More significantly, the applicant failed to file federal income tax returns for tax years 2012, 2013, 2014, 2015, and 2016. Federal income taxes totaling $4,400 were owed for tax years 2012 and 2013. Additionally, state income tax returns were not filed for tax years 2015 and 2016.
Despite some mitigating circumstances considered, the clearance was denied. The judge found that the applicant failed to file federal and state income tax returns for 2015 and 2016 and did not provide documentation for the specific amount of federal taxes due. Ultimately, there was insufficient assurance that the financial problems were resolved, under control, and would not recur.
Why the Applicant Was Denied
- Applicant failed to file federal and state income tax returns for tax years 2015 and 2016.
- Applicant did not provide documentation showing the specific amount of federal taxes due.
- Insufficient assurance that financial problems are resolved, under control, and will not recur in the future.
Conditions Referenced
- AG ¶ 19(a)raisedInability to Satisfy Debts
- AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
- AG ¶ 19(f)raisedFailure 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(c)rejectedThe Individual Has Received or Is Receiving Financial Counseling for the Problem From a Legitimate and Credible SourceApplicant did not establish that he acted prudently and responsibly under the circumstances.
- AG ¶ 20(d)rejectedThe Individual Initiated and Is Adhering to a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsApplicant's failures to ensure timely filing of tax returns showed poor judgment.
- AG ¶ 20(g)rejectedThe Individual Has Made Arrangements with the Appropriate Tax Authority to File or Pay the Amount Owed and Is in Compliance with Those ArrangementsInsufficient evidence of compliance with tax obligations.
Key Rule Quoted
“Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines.”
Procedural Posture
- SOR issuedMay 12, 2016
- Answer filedJun 22, 2016
- Hearing heldAug 15, 2017
- Decision dateFeb 28, 2018
Cite For
- Failure to File Tax Returns as a Disqualifying Condition Under Guideline F
- Insufficient Evidence of Financial Responsibility and Compliance with Tax Obligations
- Impact of Financial Issues on Security Clearance Eligibility Under the Whole-person Concept