OPINION AND ORDER

SUSAN WEBBER WRIGHT, District Judge.

Robert Moser brings this action for refund and abatement of trust fund recovery penalties assessed against him by the Internal Revenue Service (IRS) under 26 U.S.C. § 6672 concerning unpaid federal taxes withheld by MDH Builders, Inc. (MDH) for the second and third quarters of 2009. The United States has counterclaimed for the unpaid trust fund recovery penalties, claiming there is an unpaid balance of $48,041.77 for the second quarter of 2009 (ending June 30), and an unpaid balance of $63,057.65 for the third quarter of 2009 (ending September 30).

The matter is before the Court on motion of Moser for summary judgment [doc.#35]. The United States has responded in opposition to Moser's motion and Moser has filed a reply to the United States' response. For the reasons that follow, the Court denies Moser's motion for summary judgment.

I.

MDH was a construction company owned 100% by Mike Hill. Hill served as the president of MDH and Moser served as MDH's vice president and construction manager. MDH went out of business in 2009 and Hill filed for bankruptcy.

At its peak in 2006, MDH had $55 million in annual revenues. Subsequently, however, MDH began to experience cash flow problems (apparently as a result of the financial crisis in 2008) and, according to Hill, was forced to choose between paying its subcontractors to keep its projects moving forward lest "the jobs shut down and everything implodes" or pay its payroll taxes. In this respect, while MDH collected payroll taxes from its employees, in six quarters of 2008 and 2009 MDH failed to pay those taxes to the IRS. At issue is whether, pursuant to 26 U.S.C. § 6672, Moser was a "responsible person" and acted "willfully" in failing to pay over trust fund taxes for the second and third quarters of 2009.1

Moser states that although he was vice president of MDH and had check signing authority, he had no significant role in the company's tax planning. In support of this claim, Moser has submitted several affidavits from MDH employees stating that Moser did not have significant decision-making authority over MDH's tax matters.

Mike McNew, MDH's comptroller, states that Moser did not have authority to decide independently that MDH funds should be disbursed for any purpose except for projected related expenses. He states that all invoices were reviewed and approved for payment by a project manager and sent to the accounting department for future checks to be issued and that these checks were signed by Moser as a convenience and as an audit function. McNew states that Moser did not prepare any payroll tax returns or discuss any payroll tax issues with the IRS, he never participated in a formal company strategy session about the payroll tax liability, and that in his role in the company, he did not have the authority to fail willfully to disburse any funds in avoidance of the payroll tax obligations.

Similarly, Sharon Bryant, an assistant project manager for MDH, Sheilia Colclasure, who worked in MDH's accounting department, Stuart Brent, who worked for MDH doing marketing and project managing, and Valerie Culbreath, a project manager assistant for MDH, all state that Moser's primary responsibility at MDH was managing construction projects and construction managers but that Moser had no financial control over the company, that he had no authority to operate, develop or administer the financial policy of the company, that his signing of any checks was as a convenience and audit function, that he did not prepare any of the company's payroll tax returns, that he did not have authority to decide independently that company funds should be disbursed for any purpose, and that in his role in the company, he did not have the authority to fail willfully to disburse any funds in avoidance of the payroll tax obligations. In addition, Amy Atterberry, who worked in accounting for MDH, states that to her knowledge, Moser did not prepare any of MDH's payroll tax returns.

Hill likewise testified in his deposition that Moser "didn't have the authority to make the call on not paying the taxes" after August 2008. In this respect, Hill testified that in August 2008, his outside Certified Public Accountant (CPA) notified him that there was a payroll tax issue and that he immediately contacted Moser and McNew to discuss the issue. Hill states that he clarified to McNew that he no longer had to take direction from Moser when it came to "stuff" like unpaid payroll tax liability, noting that after August 2008, Moser was not in a position to direct MDH not to pay its taxes.

However, Hill also testified that Moser remained vice president of MDH, that all his other responsibilities remained intact, that Moser had the authority to prioritize which of MDH's creditors were paid when money was tight, and that Moser "was part of the decision process" of deciding to pay MDH's subcontractors instead of paying MDH's payroll taxes (at least prior to August 2008). Hill testified as follows:

In addition, Hill, in protesting the assessment of penalties against himself, informed the IRS in May 2011 that it was Moser who made the decision to divert funds that had been set aside to pay trust fund taxes and instead pay those same funds to subcontractors and suppliers. Hill testified as follows:

Moser, however, states that Hill later disavowed his representations to the IRS regarding Moser's culpability as his attempt to wriggle his way out of the tax liability MDH had incurred. Hill testified as follows:

Hill also testified that he "would assume" that Moser would "had to have known" that MDH wasn't paying their payroll taxes and he acknowledged that he didn't have any direct knowledge as to how and when Moser would have found out that the payroll taxes weren't paid. Moreover, in contrast to the affidavits of McNew, Bryant, Colclasure, Brent, Culbreath, and Atterberry, Jeremy Thompson, one of MDH's project managers, testified that Moser had the authority to direct payment of trust fund taxes to the IRS:

The United States has also submitted checks to numerous creditors and vendors other than the IRS that Moser signed after he was aware that MDH was failing to pay its payroll taxes, and Moser acknowledges that he signed payroll checks-including his own-after he was aware that MDH was failing to pay its payroll taxes that reflected "net" wages (although he appears to claim that it was McNew's doing):

In addition, Moser, although having the authority to prioritize which of MDH's creditors were paid when money was tight, acknowledged that he never as vice president directed that MDH's payroll tax liabilities be paid prior to payment of MDH's other obligations, such as subcontractors.

II.

Moser moves for summary judgment on grounds that he did not have the actual authority to direct payment of MDH's payroll taxes or decide whether the company's payroll taxes were paid. Moser argues no reasonable jury would find that he is liable for the taxes owed by MDH and Hill and therefore summary judgment should be granted in his favor.

A.

Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(a). To support an assertion that a fact cannot be or is genuinely disputed, a party must cite "to particular parts of materials in the record," or show "that the materials cited do not establish the absence or presence of a genuine dispute," or "that an adverse party cannot produce admissible evidence to support the fact." Fed.R.Civ.P. 56(c)(1)(A)-(B). "The court need consider only the cited materials, but it may consider other materials in the record." Fed.R.Civ.P. 56(c)(3). The inferences to be drawn from the underlying facts must be viewed in the light most favorable to the party opposing the motion. Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587 (1986) (citations omitted). Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000) (citation and quotation marks omitted). However, "[w]here the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no `genuine issue for trial.'" Matsushita, 475 U.S. at 587 (citation omitted). "Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). "Factual disputes that are irrelevant or unnecessary will not be counted." Id.

B.

In Dintleman v. United States, No. 3:07-cv-00081-SWW, 2010 WL 78182 (E.D. Ark. Jan. 7, 2010), this Court set forth the applicable statutory background and legal standards for actions under 26 U.S.C. § 6672 as follows:

Dintleman, 2010 WL 78182 at *1-5 (emphasis in original).

1.

The core question in determining whether Moser qualifies as a responsible person is whether he had the power to control the decision-making process by which MDH allocated funds to other creditors in preference to its withholding tax obligations. Dintleman, 2010 WL 78182 at *4 (citing Haffa v. United States, 516 F.2d 931, 936 (7th Cir. 1975)). Although Moser has presented evidence showing that after August 2008, he didn't have the authority to allocate funds to other creditors in preference to its withholding tax obligations, the United States has submitted evidence showing that it in fact was Moser who made the decision to divert funds that had been set aside to pay trust fund taxes and instead pay those same funds to subcontractors and suppliers. Viewing the inferences to be drawn from the underlying facts in the light most favorable to the United States, the Court cannot determine, as a matter of law, that Moser was not a responsible person under 26 U.S.C. § 6672. Rather, determining whether Moser was a responsible person will involve credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts that are jury functions and not those of a judge. Reeves, 530 U.S. at 150.

2.

Concerning willfulness, "`[e]vidence that the responsible person had knowledge of payments to other creditors, including employees, after he was aware of the failure to pay over withholding taxes is proof of willfulness as a matter of law.'" Dintleman, 2010 WL 78182 at *5 (quoting Olsen v. United States, 952 F.2d 236, 240 (8th Cir.1991)). Here, Moser acknowledges that after he was aware that MDH was failing to pay its payroll taxes, he signed payroll checks (including his own) that reflected "net" payroll, i.e., paying net payroll without paying over any withholding taxes to the IRS, and the United States has presented evidence that Moser also disbursed funds to creditors other than the IRS after that time. Viewing the inferences to be drawn from the underlying facts in the light most favorable to the United States, the Court cannot determine, as a matter of law, that Moser did not willfully fail to pay over trust fund taxes.

III.

For the foregoing reasons, the Court denies Moser's motion for summary judgment [doc.#35].

IT IS SO ORDERED.