Nusseibeh v. Zaino

Summary

The Ohio Supreme Court considered whether Raed Nusseibeh, the sole corporate officer and shareholder of Nusseibeh, Inc., was personally liable for the corporation’s unpaid sales taxes under R.C. 5739.33. The court held that a sole corporate officer is responsible for the corporation’s fiscal responsibilities and cannot delegate that responsibility, affirming the Board of Tax Appeals’ decision.

Holdings

1. When a corporation has only one corporate officer, that officer is responsible for executing the corporation's fiscal responsibilities, including paying the proper amount of sales tax, and may be held personally liable for the corporation's failure to file returns or remit tax.
2. In a proceeding concerning derivative personal liability under R.C. 5739.33, the underlying assessment against the corporation is not at issue once the corporation failed to object and the assessment became conclusive; the officer is bound by the corporation's failure to contest it.
3. The BTA properly affirmed the derivative assessment because Nusseibeh failed to demonstrate that the Tax Commissioner's assessment was erroneous, unreasonable, or unlawful.

Questions Presented

1. Whether a sole corporate officer and sole shareholder is personally liable under R.C. 5739.33 for the corporation's unpaid sales tax when he was the corporation's only officer responsible for its fiscal responsibilities.
2. Whether the Board of Tax Appeals properly affirmed the derivative sales-tax assessment under the applicable taxpayer burden and presumptive-validity standards.

Disposition

affirmed