Case Explained: RC Smithfield v. United States

Court: United States Court of Appeals for the Tenth Circuit Filed: 2026-07-06 Docket: 1:21-CV-00090-JNP) The Tenth Circuit affirmed the district court’s judgment in favor of the United States, holding that federal tax liens validly attached to real property in Utah despite RC Smithfield, LLC holding legal title. The court determined that the defunct Sid Crookston Construction (SCC) retained a beneficial interest in the parcels, thereby qualifying as “property” or “rights to property” under federal tax law subject to IRS enforcement. The court applied the two-step framework established in *United States v. Tingey* and *Drye v. United States*: first, determining rights under state law (Utah), and second, assessing whether those rights constitute property under federal tax law. Under Utah law, which follows the Restatement (Second) of Trusts, the court found that a resulting trust arose in favor of SCC because SCC paid half of the purchase price for the parcels while RC Smithfield took legal title, with no evidence that SCC intended to make a gift or receive an exchange of value. The court rejected the appellant’s argument that the LLC status shielded the property, clarifying that the IRS was attaching a lien to SCC’s beneficial interest rather than piercing the corporate veil to reach a member’s personal assets. Additionally, the court held that Plaintiff waived its argument regarding the specific language of the filed liens due to inadequate briefing in its opening brief. As a result of this affirmation, the district court’s ruling stands, meaning the federal tax liens against SCC and its successor-in-interest remain valid encumbrances on the Utah parcels, and RC Smithfield, LLC cannot quiet title to the property free of those liens. Do It For The Case Law is a news reporting service. Nothing in this episode constitutes legal advice.