John H. Holland v. United States

John H. Holland appeals from a judgment of the United States District Court for the Eastern District of California holding that a partial payment of delinquent employee withholding and social security taxes would not abate the statutory interest that had accrued on the penalty assessment. We affirm.

The facts are not disputed. The appellant was the sole shareholder and president of Roseville Ford, Inc., a California corporation with approximately sixty employees. Roseville Ford failed to pay its employee withholding and social security taxes for the second, third, and fourth quarters of 1980. The Internal Revenue Service (“IRS”) determined that for the periods involved there were $74,127.07 in unpaid taxes and assessed a penalty against the appellant in that amount pursuant to 26 U.S.C. § 6672 .

The appellant disputed the assessment and sent the IRS payments of $2.28, $2.47, and $1.54 for the withholding taxes of one employee for the second, third and fourth quarters of 1980. These payments were credited against the penalty assessment. The following day the appellant filed a separate refund claim for each payment. The IRS denied the refund, and the appellant responded with a tax…