                NOT RECOMMENDED FOR FULL TEXT PUBLICATION
                           File Name: 12a1012n.06

                                          No. 11-5221

                          UNITED STATES COURT OF APPEALS
                               FOR THE SIXTH CIRCUIT
                                                                                    FILED
                                                                                 Sep 14, 2012
UNITED STATES of AMERICA,                    )                              DEBORAH S. HUNT, Clerk
                                             )
       Plaintiff-Appellee,                   )
                                             )      ON APPEAL FROM THE UNITED
v.                                           )      STATES DISTRICT COURT FOR
                                             )      THE WESTERN DISTRICT OF
THOMAS SCHROEDER,                            )      KENTUCKY
                                             )
       Defendant-Appellant.                  )


BEFORE: GUY and DONALD, Circuit Judges; and O’MEARA, District Judge.*

       JOHN C. O’MEARA, District Judge. In this matter, Defendant-Appellant, Thomas

Schroeder (“Schroeder” or “Defendant”), appeals his conviction March 29, 2012 for conspiracy to

impede and impair the Internal Revenue Service (“IRS”), in violation of 18 U.S.C. § 371.

Defendant’s conviction stems from his involvement in the National Center for Public Education and

Prevention (“NCPEp”) and with Dr. Robert Felner (“Felner”), his co-conspirator. Schroeder was

the executive director of NCPEp, which was designed to be an Illinois non-profit corporation

providing examinations and surveys for school systems around the country. Felner was a dean at the

University of Louisville, who was employed by NCPEp and helped organize its creation.

       On February 2, 2010, Defendant was charged with mail fraud (Count 1), conspiracy to

launder money (Count 2), and conspiracy to impair or impede the IRS (Count 3). Felner was also

charged with these crimes, and several other counts. Felner pled guilty, but Defendant chose to

       *
        The Honorable John C. O’Meara, United States District Judge for the Eastern District of
Michigan, sitting by designation.
proceed to trial. After a three-week jury trial, Defendant was convicted of conspiring to impair or

impede the IRS, but acquitted on the other charges. He was sentenced to 46 months imprisonment.

       Defendant challenges his conviction and sentencing on four grounds. First, he claims that

there was insufficient evidence from which a jury could convict him of conspiring to impede the IRS.

Next, Defendant contends that the prosecution constructively amended Count 3 of the indictment

by putting forth evidence that Defendant overstated his expenses on his personal income tax returns

when the indictment charged him with failing to report income he received from NCPEp. Defendant

also argues that the district court erred in refusing his proposed theory-of-defense instruction

regarding good faith. Finally, Defendant claims that his sentence should be vacated because the IRS

agent who testified improperly calculated his tax loss. He also argues the district court erred by

improperly attributing Felner’s tax loss to him. Additionally, Defendant alleges his sentence was

disproportionately harsh considering how much more culpable Felner was and how much more

Felner benefitted from the scheme. For the following reasons, we AFFIRM.

                                  FACTUAL BACKGROUND

       In this case, Defendant was convicted of conspiracy to impair/impede the IRS after a jury trial

that lasted over three weeks. He was friends with his co-conspirator, Felner, who worked at the

University of Louisville (“UofL”) as a dean of education. While formerly working for the University

of Rhode Island (“URI”), Felner helped run URI’s National Center for Public Education and Social

Policy (“NCPE”). NCPE used software that Felner created to survey school districts, evaluate their

performance, and suggest changes. NCPE contracted with school districts in Atlanta, Buffalo, and

Santa Monica to survey and evaluate their schools.




                                                 2
       The government alleged that Felner and Defendant set up NCPEp in 2001 to defraud those

school districts, as well as UofL and the Rock Island County Council on Addictions (“RICCA”), to

launder money, and to impair and impede the IRS. Basically, while NCPE did work for the school

districts, Felner sent invoices to them directing that payment for the work NCPE was doing be made

out to Felner/NCPEp. Defendant was the executive director of RICCA, an agency offering

prevention assistance for people with alcohol or drug addictions through outpatient treatment and

a residential program, as well as the executive director of NCPEp. Additionally, Defendant was a

research assistant for Felner, and was paid $25,000 a year by UofL. Defendant held a similar

position with URI when Felner was a professor and dean there.

       Although Felner played a major role in NCPEp, the entity was created by Defendant, an

accountant, John Timmer (“Timmer”), and an attorney, Timothy Feeney (“Feeney”). NCPEp was

incorporated in Illinois, and Feeney was its lawyer and registered agent. Felner acted as a

coordinator for NCPEp, and from a practical standpoint was most familiar with NCPEp’s purported

purpose, which was to offer testing and evaluation services to schools throughout the country.

NCPEp was supposed to be a non-profit corporation, and steps were taken to obtain status as a

501(c)(3) company, but ultimately those filings were never completed. At its onset, NCPEp applied

for an employer identification number (“EIN”), and approved an executive-director compensation

package of $3,000 a month for Defendant.

       The government’s investigation of NCPEp uncovered three bank accounts that were affiliated

with the corporation. First, Feeney and Defendant set up an American Bank and Trust account in

Rock Island, Illinois (the “AB&T account”) on July 17, 2001. Defendant was one of two signatories

on the AB&T account and had control of the account. In 2002, a second account at Citizens Bank


                                                3
in Rhode Island (the “Citizens account”) was opened with a $250,000 check from the AB&T

account. In February 2004, Felner opened a third business bank account in the name of NCPEp at

Branch Banking and Trust (the “BB&T account”) in Louisville, Kentucky. In order to open this

account, Felner falsely stated that he was an officer of NCPEp and listed his home phone number

and address in Louisville for the account.

       The IRS’s lead criminal investigator in this case, Special Agent Robert Masterson (“Agent

Masterson”) testified that between 2001 and 2008, $2,250,097 was deposited into the three NCPEp

accounts. $1,053,097 was deposited into the AB&T account, $169,000 in the Citizens account, and

$1,028,000 in the BB&T account. Agent Masterson determined that $1,706,972 came from money

various school districts thought they were paying for work being performed by NCPE at URI.

$450,000 was from work Felner told UofL he was doing on behalf of a No Child Left Behind grant

the university had received, and $93,125 came from RICCA. From his investigation, Agent

Masterson found no evidence that NCPEp did any work, or that the accounts were used for anything

other than taking in checks and redistributing the money, aside from approximately $15,000 that

could have possibly gone towards business expenses such as paying Feeney and Timmer for

professional services, bank fees, and corporate filing fees.

       Agent Masterson also tracked how the money was distributed from the NCPEp accounts.

The vast majority of the funds, over $2,000,000 worth, went to Felner. Specifically, checks worth

$517,823 were made out directly to Felner. Another $1,349,985 went to other parties for Felner’s

benefit. These payments were typically associated with properties Felner owned or purchased.

Close to $60,000 went to other individuals that did no work for NCPEp. For example, Diana

Laferriere, the business manager of NCPE in Rhode Island, received $1,000 a month for 23 months


                                                  4
for doing absolutely nothing. She was told she was on NCPEp’s board, but never did anything in

conjunction with the position. She once asked Felner why she was receiving this monthly payment,

and he simply told her not to worry about it, and that she had earned it. Finally, she asked Felner to

stop sending her the money, and she stopped receiving checks.

       Defendant himself was paid $282,853 by NCPEp, with almost all of these payments coming

from the AB&T account which he controlled. The majority of these payments were “executive

director fees” for $3,000 a month. The rest were stylized as reimbursements for various expenses

like hotels, per diems, and milage. Another $14,082 went to pay off Defendant’s American Express

credit card debt. This amount was noted by Agent Masterson because those payments went to pay

off charges Defendant incurred for expenses like travel, hotels, per diems, and milage. Defendant,

however, also claimed these expenses as deductions on his personal income tax returns.

       Much of the evidence presented at trial revolved around NCPEp’s failure to properly fill out

various IRS forms, in particular Form 1099s (“1099s”). Employers are required to fill out W-2s that

note how much money is paid to each employee in a given year. The employer must send the IRS

copies of the W-2s and must also give employees a copy for their own records and filings. 1099s

are like W-2s except that an employer will fill them out for non-employees that receive income from

the employer. Independent contractors are the most common example of someone who would

receive a 1099. A Form 1096 (“1096") is a summary of all the 1099s an employer gives out in a

given year that also must be filed with the IRS.

       NCPEp failed to properly file several 1099s. The most glaring omissions surrounded Felner.

NCPEp issued Felner a 1099 for 2001, the first year the entity existed. After he received the 1099

for 2001, however, Felner called Defendant, Timmer, and Feeney and demanded that they stop


                                                   5
sending him 1099s. After 2001, Felner never received a 1099 for income he received from NCPEp

until 2007, when he requested one be made out for a specific amount of income that was far less than

the amount the government alleged he received that year.

       Aside from failing to issue Felner 1099s properly, IRS agents testified that NCPEp almost

never filed any corporate tax records with the IRS. In 2001, NCPEp filled out a 1096 and some

1099s, but they were not filed with the IRS. In 2002, some forms were filed with the IRS. Other

than those instances, the IRS had no record of NCPEp filing any tax returns. For example, the IRS

had no record that NCPEp ever filed a Form 990, which is the return for organizations that are

exempt from paying income tax, or a Form 1120, which is the corporate income tax return. As

executive director, it was Defendant’s responsibility to make sure NCPEp’s taxes were properly

filed. Over the years, Defendant never seemed to have a problem overseeing RICCA’s tax returns,

including its 990s.

       There were also issues surrounding the 1099s RICCA filled out for work Felner/NCPEp

allegedly performed on its behalf over the years. From 2004 to 2008, Defendant, who was the

executive director of RICCA, signed invoices for monthly payments to Felner/NCPEp for consulting

services. RICCA’s bookkeeper testified that, unlike most checks that she sent out on behalf of

RICCA, she never mailed these to Felner or to NCPEp’s offices.1 She always simply handed them

to Defendant, who told her that he would deliver them to Felner. Timmer’s accounting firm, which

also was RICCA’s CPA, sent a letter to Defendant asking him to clarify whether certain checks were

made out to Felner individually or NCPEp. There was confusion because it would often be

ambiguous who the checks were actually made out to because the payee would be Robert D. Felner,


       1
           It should be noted that NCPEp did not maintain any separate offices or permanent location.

                                                  6
Ph.D. – National Center on Public Education and Prevention, Inc. If they were made out to Felner,

he should have received his own 1099, with his social security number on it, as opposed to NCPEp’s

EIN. There was evidence presented that RICCA issued 1099s to NCPEp for income that should

have been attributed to Felner personally.

       In 2006, NCPEp was involuntarily dissolved by the State of Illinois for failure to file annual

reports. Timmer’s firm also resigned from doing work for NCPEp in 2006, although it continued

to provide accounting services to RICCA. Timmer stated that he believed NCPEp was dormant after

2006 because Defendant informed him that it had been taken over by Felner and the University of

Louisville, and that it was out of Defendant’s hands.

                                   PROCEDURAL HISTORY

       Both Felner and Defendant were charged with several criminal counts. Felner pled guilty to

fraud, conspiracy to launder money, tax evasion, conspiracy to impair or impede the IRS and other

charges. Defendant was charged with conspiracy to defraud, launder money, and impair/impede the

IRS. He was acquitted of the first two charges and found guilty of the third. Defendant moved for

judgment of acquittal or, in the alternative, for a new trial. The district court denied Defendant’s

motion.

       At the sentencing hearing, Defendant objected to the Presentence Report’s tax-loss figure,

which included the tax loss attributable to Felner. The district court found that Felner’s tax loss was

reasonably foreseeable to Defendant in light of their conspiracy to impair or impede the IRS. As a

result, the court determined that Defendant was accountable for a tax loss of between $400,000 and

$1,000,000. After adding two levels for the complexity of the conspiracy, the court determined that

Defendant’s total offense level was 22. When combined with Defendant’s criminal history category


                                                  7
of I, Defendant’s guideline range was 41-51 months. The district court sentenced Defendant to 46

months imprisonment.

                                          DISCUSSION

       Defendant makes four arguments on appeal. First, he claims that there was insufficient

evidence from which a jury could find that he and Felner agreed to impede the IRS beyond a

reasonable doubt. Defendant next contends that the prosecution constructively amended Count 3

of the indictment by putting forth evidence that Defendant overstated his expenses on his personal

income tax returns when the indictment charged him with failing to report income he received from

NCPEp. Defendant also argues that the district court erred when it refused to submit his proposed

jury instruction regarding good faith. Finally, Defendant claims that his sentence is unreasonable

because the IRS agent who testified as to what Defendant’s tax loss was improperly calculated it.

He argues that his sentence is unreasonable because it improperly attributes Felner’s tax loss to him

and was disproportionately harsh considering Felner was only sentenced to 63 months in prison. For

the following reasons, we AFFIRM.

I.     Sufficiency of the Evidence

       Defendant’s first argument is that the evidence failed to establish that he engaged in a

conspiracy to impair or impede the IRS beyond a reasonable doubt. In reviewing a challenge to the

sufficiency of the evidence to support a criminal conviction, we must “determine whether the record

evidence could reasonably support a finding of guilt beyond a reasonable doubt. Jackson v. Virginia,

443 U.S. 307, 318 (1979). When making this determination, all inferences must be made in favor

of the jury’s verdict. See United States v. Cecil, 615 F.3d 678, 691 (6th Cir. 2010) (“The standard

of review for a sufficiency of the evidence challenge is whether, after viewing the evidence in the


                                                 8
light most favorable to the prosecution, any rational trier of fact could have found the essential

elements of the crime beyond a reasonable doubt.”) (internal citations and quotation marks omitted).

       Defendant argues that the government did not prove any express or implied agreement

between himself and Felner to impede the IRS and that, at best, it established that Defendant

mistakenly overstated expenses on his personal income taxes. Because there was more than enough

evidence from which a reasonable juror could find that Defendant was guilty of conspiring to impair

or impede the IRS beyond a reasonable doubt, we affirm Defendant’s conviction.

       The main issue is whether the government put forth evidence that Defendant and Felner

conspired to use NCPEp to conceal income from the IRS. To establish a conspiracy, the government

must prove that there was an agreement between two or more persons to act together to commit a

crime, and at least one overt act by either conspirator in furtherance of the conspiracy. United States

v. Milligan, 17 F.3d 177, 182 (6th Cir. 1994). “Proof of a formal agreement is unnecessary, because

acts done with a common purpose can establish an implicit agreement.” Id. at 182-83; see also

United States v. Beverly, 369 F.3d 516, 532 (6th Cir. 2004). Not every member of the conspiracy

must be an active participant in each phase or every aspect of the conspiracy. Beverly, 369 F.3d at

532; Milligan, 17 F.3d at 183 (“A defendant may be guilty of conspiracy despite possessing limited

knowledge of the conspiracy’s scope, details and membership.”). “A conspiracy may be inferred

from circumstantial evidence that can reasonably be interpreted as participation in the common

plan.” Id. (quoting United States v. Barger, 931 F.2d 359, 369 (6th Cir. 1991)) (quotation marks

omitted); see also United States v. Avery, 128 F.3d 966, 971 (6th Cir. 1997).

       The most pertinent evidence that Felner and Defendant agreed to use NCPEp to avoid paying

taxes was the improper handling of Felner’s 1099s. Felner seemed to be able to dictate whether he


                                                  9
received 1099s from NCPEp or RICCA whether he earned income from them or not. Felner

received a 1099 from NCPEp for the year 2001. After he received it, however, he called Defendant

and Timmer and told them not to send him 1099s any more. Timmer testified that Felner was upset

that he had received a 1099 from NCPEp because he claimed that he did not receive all of the money

stated in the form and that most of it went to pay for supplies, other expenses, and to different

people. Timmer informed Felner that the amount was correct, and that he needed to report the

amount of money he received as gross income. On his tax forms he could then list and deduct any

expenses he incurred so that he would only be taxed on his net gain. After speaking with both Felner

and Defendant, the 2001 1099 was not altered. That, however, was the last time that Felner received

a 1099 from NCPEp until he requested one for 2007. Timmer testified:

       In the subsequent years, 2002 and I believe 2003, when we were preparing 1099s,
       there was some question as to what amount should be on Dr. Felner’s 1099,
       specifically, I believe for the 2002. We were — we were told to go ahead and
       process the 1099s for — for Tom Schroeder, for some other individuals that worked
       — or were paid by the NCPEp, but to hold off on completing Felner’s until it was
       resolved and it would be filed later.

Defendant was the one who told Timmer to handle the 1099s that way, and ultimately, Felner’s

situation was never resolved. Subsequent 1099s should have been filed for the income Felner

received from NCPEp, but ultimately they never were. When asked why they were not, Timmer

testified: “We were instructed to go ahead and complete the 1099s that we did complete. We made

note that we still needed to complete them for Felner and Patsenaude. We were waiting for

additional information and instruction to do so and never received it.” Timmer stated that his firm

asked Defendant for the information and/or further instructions.




                                                10
       In addition to not filling out 1099s for Felner, Timmer testified that after 2003, no 1099s

were sent out from NCPEp to anybody. When asked if he had a problem or concern about how the

company was operated after 2003 and 2004 going forward, Timmer responded, “I certainly had

concerns relative to payments to Felner, the 1099 reporting, and not being able to complete the

charitable application. We knew that that had not been complete. We knew the tax returns hadn’t

been filed. There were gaps there.”

       Felner was not issued a 1099 from NCPEp until 2007, when he specifically asked for one

indicating that he made $36,450 that year from NCPEp. Agent Masterson testified that number

inaccurately stated how much money Felner received from NCPEp that year. In 2007, Felner

received $450,000 from payments NCPEp received from UofL for the No Child Left Behind Grant.

Agent Masterson explained that Defendant was aware that Felner received this money from UofL,

on behalf of NCPEp, because UofL sent at least one check for $200,000 to NCPEp in Illinois instead

of directly to Felner like Felner had instructed UofL. Defendant told Agent Masterson that, per

Felner’s instructions, he forwarded the check to Felner in Kentucky. At least one other check from

UofL that ultimately ended up getting deposited in the BB&T account, passed through Defendant’s

hands. Agent Masterson said he knew Defendant had the checks at one point because “Mr. Feeney

said that, and Mr. Schroeder said that, and I found in AMEX records the shipment information to

the University of Louisville.”

       There was also evidence that Felner and Defendant did not properly record income they

received for work NCPEp was purportedly doing for RICCA. Linda Bergendahl, RICCA’s

bookkeeper, testified that Defendant signed invoices for monthly payments to Felner/NCPEp from

2004 to 2008 for consulting services. She said that unlike most checks she sent out on behalf of


                                               11
RICCA, she never mailed them to Felner or NCPEp’s offices. She always gave them to Defendant,

who told her he would deliver them to Felner. Bergendahl was surprised to learn that Defendant had

been depositing those checks into the AB&T account in Rock Island that Defendant controlled under

NCPEp’s name.

       Felner received compensation from RICCA for his work as a non-employee consultant.As

a result, he was supposed to receive a 1099 form from RICCA. Several checks RICCA wrote were

unclear whether the recipient was Felner or NCPEp. Timmer’s firm sent a fax to Defendant asking

him to clarify some records regarding payments RICCA made to NCPEp/Felner. Specifically, the

fax asked:

       On the schedule provided for 1099s, you listed National Center on Public Education
       & Prevention, Inc. as the recipient of funds in the amount of $6,250. It appears that
       these payments were actually made out to Robert D. Felner, PhD. It appears that we
       would need to reflect this under Social Security Number. Please advise in writing
       how to proceed.

The payment should have been recorded under Felner’s SSN, as opposed to NCPEp’s EIN in order

to ensure that he would be accountable for tax purposes.

       Finally, Timmer also testified that he never filed or prepared any corporate tax returns for

NCPEp. This struck Timmer as unusual. An IRS data-analyst, Paul Crowley, also testified that the

IRS had no record of NCPEp filing any tax returns. Except for the year 2002, NCPEp never filed

any 1099s or W-2s. In 2002, NCPEp indicated that it paid Diana LaFerriere $6,000 in nonemployee

compensation, Felner nonemployee compensation of $105,000 with royalties of $97,000, Defendant

nonemployee compensation of $24,000, and Feeney’s firm $3,000 for the year 2001. Crowley

testified that when corporations fail to file 1099s, 1096s, and W-2s, it makes it much more difficult

for the IRS to assess and collect taxes.


                                                 12
       From the testimony outlined above, there was sufficient evidence for a reasonable jury to find

beyond a reasonable doubt that Defendant and Felner conspired to impair or impede the IRS. Indeed,

at the sentencing hearing, Defendant’s attorney seemed to concede this issue. While arguing that the

government had failed to prove Defendant obstructed justice, and, therefore, that Defendant’s

sentence should not be enhanced on that basis, defense counsel stated “[y]es, they have presented

enough evidence to a jury to convict for a conspiracy with Felner on that — on that impeding or

obstructing IRS, but . . . I don’t see an actual false statement having been proven to be made. I just

don’t.” Accordingly, Defendant’s conviction for conspiring to impair or impede the IRS should be

affirmed.

II.    Constructive Amendment

       Defendant also argues that the district court erroneously allowed the prosecution to

constructively amend Count 3 of the superceding indictment by permitting evidence that Defendant

over-reported expenses on his personal income tax returns. Defendant contends that by focusing on

the overstated expenses, the prosecution abandoned the actual indicted Overt Acts, which alleged

that he “failed to report gross income received from NCPEp.”

       Essentially, Defendant claims that the evidence presented at trial represented a variance from

the indicted charge to such a degree that it, in effect, amended Count 3. This Circuit has explained

that a variance constitutes a constructive amendment

       when the terms of an indictment are in effect altered by the presentation of evidence
       and jury instructions which so modify essential elements of the offense charged that
       there is a substantial likelihood that the defendant may have been convicted of an
       offense other than that charged in the indictment.




                                                 13
United States v. Barrow, 118 F.3d 482, 488 (6th Cir. 1997) (quoting United States v. Hathaway, 798

F.2d 902, 910 (6th Cir. 1986)). “The defendant bears the burden of proving the existence of a

variance and that such variance affected his substantial rights or rose to the level of a constructive

amendment of the indictment.” United States v. Searan, 259 F.3d 434, 446 (6th Cir. 2001).

Substantial rights are only affected when the defendant demonstrates “prejudice to his ability to

defend himself at trial, to the general fairness of the trial, or to the indictment’s sufficiency to bar

subsequent prosecutions.” Id. (quoting Hathaway, 798 F.2d at 911) (quotation marks omitted).

Reversal is not warranted where the indictment “fully and fairly informed the defendant of the

charges he had to answer at trial.” Id.

       The district court denied Defendant’s motion to acquit, or alternatively, for a new trial due

to this alleged constructive amendment. The court found that evidence demonstrating Defendant

claimed un-reimbursed expenses that had been reimbursed by RICCA or NCPEp “also supports the

theory that [Defendant] concealed income.” Although this statement suggests that the district court

did not view the disputed testimony as a variance, the district court also held that Defendant’s

allegations, even if true, were not prejudicial. For example, the court stated that the testimony

regarding Defendant’s income-tax discrepancies was not the only evidence proving Count 3. Finally,

the court held that

               There was more than sufficient evidence upon which the jury could find the existence
               of the charged agreement between Felner and Schroeder, Schroeder’s knowing and
               voluntary participation in that agreement, and the commission by a conspirator of a
               charged over act in furtherance of the agreement. The contention that a portion of the
               United States’ proof constituted a variance in Count 3 requiring a new trial is without
               merit.




                                                  14
        We review whether an indictment was constructively amended de novo. United States v.

Budd, 496 F.3d 517, 521 (6th Cir. 2007). We review the district court’s decision not to grant a new

trial for abuse of discretion. United States. v. Holder, 657 F.3d 322, 328 (6th Cir. 2011). “A district

court abuses its discretion when it applies an incorrect legal standard, misapplies the correct legal

standard, or relies upon clearly erroneous findings of fact.” Id. (quoting United States v. Pugh, 405

F.3d 390, 397 (6th Cir. 2005)) (quotation marks omitted).

        To begin with, we agree with the district court’s assessment that the evidence demonstrating

Defendant overstated his expenses with respect to NCPEp “also supports the theory that [Defendant]

concealed income.” As a result, a strong argument can be made that such evidence did not constitute

a variance from the essential charge of Count 3, which was that Defendant and Felner “did

knowingly combine, conspire, confederate, and agree with one another, to defraud the United States

for the purpose of impeding, impairing, obstructing, and defeating the lawful functions of the [IRS]

in the ascertainment, computation, and assessment and collection of federal income taxes.”

Obviously, by misrepresenting his gross income, Defendant impaired the IRS’s ability to compute

and collect the total amount of income tax he owed. Although it is true that the indictment alleged

that the “object of the conspiracy” was to conceal income through NCPEp, and that technically

Defendant did not conceal income by overstating his expenses, we find that the evidence is still

probative of Defendant’s use of NCPEp as an entity to avoid paying income tax.

        Even if we were to conclude that the disputed evidence constituted a variance from the

indictment, the district court should still be affirmed. As noted above, the critical inquiry is whether

the variance “so modif[ied] essential elements of the offense charged that there is a substantial

likelihood that the defendant may have been convicted of an offense other than that charged in the


                                                  15
indictment.” Barrow, 118 F.3d at 488 (quoting Hathaway, 798 F.2d at 910). Because the variance

Defendant alleges did not modify the elements of this charge, and there was clearly no confusion

regarding the crime Defendant was charged with and had to defend, the district court should be

affirmed.

       Although the superceding indictment did not explicitly articulate the elements of Count 3,

the jury instructions did. The instructions stated that as to the first element “from July 2001 to and

including July 2008, Thomas Schroeder and Robert Felner agreed to defraud the Internal Revenue

Service by dishonest means[.]” The second element required the jury to find that Defendant

“knowingly and voluntarily joined in that agreement;” and the instructions as to the third element

required the jury to find “a member of the conspiracy did one of the overt acts described in the

superseding indictment for the purpose of advancing or helping the conspiracy.”

       Evidence that Defendant overstated his expenses (as opposed to under reported his income)

does not impact any of those elements. The only element the alleged variance might have affected

is the third element, but only if evidence of the over reported expenses was the only overt act the

government established at trial. However, the government demonstrated many of the overt acts

listed in the indictment, including that Defendant set up NCPEp, applied for an EIN, established the

various NCPEp accounts, and provided Felner with a 1099 for 2007 stating that he earned

substantially less from NCPEp that year than he actually did. Furthermore, the alleged variance did

not cause a risk that Defendant was convicted of a different crime, and did not deprive him notice

or a full and fair opportunity to defend himself. See Searan, 259 F.3d at 446. Accordingly, we find

that the government did not constructively amend Count 3, and affirm the district court’s denial of

Defendant’s motion to acquit or for a new trial.


                                                   16
III.    Jury Instructions

        Defendant claims that the district court erred by failing to issue his proposed jury instruction,

which explained that Defendant’s good-faith reliance on the professional advice of Timmer and

Feeney was a complete defense to the charges against him. We review a district court’s choice of

instructions for abuse of discretion. United States v. Tarwater, 308 F.3d 494, 510 (6th Cir. 2002).

We look at the instructions as a whole when deciding whether the district court fairly and adequately

submitted the issues and law to the jury. Id. “Generally, a defendant is entitled to an instruction on

defense theories that are supported by law and raised by the evidence presented.” Id. (citing United

States v. Duncan, 850 F.2d 1104, 1118 (6th Cir. 1988)). This Court will only reverse a district

court’s decision not to give a requested instruction if (1) the instruction is a correct statement of law;

(2) it is not substantially covered by other instructions the jury receives; and (3) the fact that the

requested instruction is not presented to the jury impairs the defendant’s theory of the case. Id.

        In the past, this Court has found that the lack of a specific instruction regarding a good-faith

defense was substantially covered by other instructions. See, e.g., Tarwater, 308 F.3d at 510. In

Tarwater, we assumed that the defendant had presented evidence to support his good-faith defense,

but held that the district court’s jury instructions, when viewed as a whole, adequately encompassed

this defense. Id. The instruction actually given in that case stated:

        The word “willfully,” as used in this statute, means a voluntary, intentional violation
        of a known legal duty. In other words, the defendant must have acted voluntarily and
        intentionally and with the specific intent to do something he knew the law prohibited,
        that is to say, with the intent either to disobey or to disregard the law. Negligent
        conduct is not sufficient to constitute willfulness.




                                                   17
Id. We held that “[t]he jury’s conclusion that Tarwater acted willfully would necessarily negate any

possibility of ‘good faith’ in filing false tax returns.” Id.

        In the instant case, the jury instructions indicated that in order to find Defendant guilty of

Count 3, the jury must find that Defendant entered into the conspiracy to impede or impair the IRS

“knowingly and voluntarily.” The government argues that the district court did not err in denying

Defendant’s proposed jury instruction regarding good faith because it was substantially covered by

the instructions that were given. The government claims that the instruction that “substantially

covered” Defendant’s proposed instruction stated: “The word ‘knowingly,’ as that term has been

used in these instructions, means that the act was done voluntarily and intentionally and not because

of mistake or accident.” As in Tarwater, this instruction substantially covered Defendant’s proposed

good-faith instruction because in order for the jury to find Defendant guilty, it would necessarily

have to conclude that he intended to agree to impede/impair the IRS and that his actions were not

simply the result of following bad advice or accidentally miscalculating his taxes. Accordingly, we

affirm the district court’s decision not to grant Defendant’s motion for acquittal or a new trial

because the district court did not issue his proposed jury instruction.

IV.     Sentencing

        Defendant was sentenced to 46 months imprisonment. The district court arrived at this

sentence after calculating that Defendant had an offense level of 22. Because the court found that

Felner’s tax loss was reasonably foreseeable to Defendant, it included the amount of taxes Felner

avoided when sentencing Defendant.          The court, therefore, determined that Defendant was

responsible for a tax loss between $400,000 and $1,000,000. Coupled with Defendant’s criminal

history category of I, his guideline range was 41-51 months.


                                                   18
       Defendant contends that the sentence the district court imposed was unreasonable. Defendant

makes three arguments to this effect. He disputes base offense level because he believes that the

government’s witness and the district court failed to calculate his tax loss properly. Defendant also

claims that it was improper to attribute the tax loss associated with Felner to him. Finally, Defendant

argues that his sentence is unreasonable when compared to Felner’s sentence because he was

convicted of much less than what Felner pled guilty to, Felner was much more culpable, and Felner

profited so much more financially from the conspiracy.

       This Court reviews sentencing decisions for abuse of discretion. Gall v. United States, 552

U.S. 38, 46 (2007) (citing United States v. Booker, 543 U.S. 220, 260-62 (2005)). The district

court’s determination of the tax loss attributable to Defendant is reviewed for clear error. United

States v. Erpenbeck, 532 F.3d 423, 433 (6th Cir. 2008). The methodology the court uses to make

that calculation, however, is reviewed de novo.         Id. This Court applies a presumption of

reasonableness to sentences within the guidelines range. United States v. Berry, 565 F.3d 332, 341

(6th Cir. 2009) (quoting United States v. Williams, 436 F.3d 706, 708 (6th Cir. 2006)).

       A.      Was Felner’s Tax Loss Foreseeable?

       The most critical challenge to Defendant’s sentence is his claim that the district court erred

when it held that Felner’s tax loss was foreseeable to Defendant, and, therefore, attributable to him

at sentencing. It is clear that irrespective of how Defendant’s individual tax loss is calculated, the

vast majority of the tax loss Defendant was held accountable for was income Felner did not report

to the IRS. At the sentencing hearing, Defendant objected to the government’s calculation of his tax

loss and claimed that Felner’s tax loss was not foreseeable to him. The district court made the

following ruling with respect to the foreseeability issue:


                                                  19
               I don’t think the government has to prove that Schroeder walked hand-in-hand and
               arm-and-arm with Mr. Felner on every bit of Felner’s omissions and crimes but that,
               generally speaking, similar to the analogy used with drug cases, if they had a
               generalized appreciation of where this was going, and what was happening, and what
               was going on, they’re held responsible for it and – so I think that that is not an
               improper inference from all the evidence that came in during the trial in this case.
               They worked closely and they were compatriots in this. And so I think including the
               figures regarding Felner for tax loss in this conspiracy case is not inappropriate and
               is, in fact, appropriate in the matter. So on that basis, I’m going to overrule the
               objection and find that the base offense level has been properly calculated in the
               presentence report.

       A review of the record demonstrates that the district court’s ruling was proper. Agent

Masterson testified at the sentencing hearing that Felner’s tax loss was foreseeable to Defendant

because he knew, or should have known, that Felner should have continued to receive 1099s for

income he earned from NCPEp. It was not an abuse of discretion for the district court to find that

Defendant knew that Felner was not claiming his taxes for the same reasons that there was sufficient

evidence to find Defendant and Felner conspired to impair or impede the IRS. Clearly, the tax loss

resulting from unclaimed income Felner received from the AB&T account was foreseeable to

Defendant because he had exclusive control over that account.

       Defendant argues that the tax loss attributable to money deposited by Felner in the Citizens

account in Rhode Island should not be attributed to him because he was unaware of that account, and

Felner opened it by forging Defendant’s signature. Agent Masterson, however, explained that

Defendant should still be responsible for the tax loss associated with that account because “the

Citizens Bank account was formed with a check from AB&T for $250,000.” Furthermore, he

testified that “[w]e have documentation that we presented at trial that shows that Mr. Schroeder wire

transferred funds to the Citizens Bank account in Rhode Island and received checks back from that




                                                 20
Citizens Bank account, and that he was also involved in a stock transaction at one point with the

investment account for Citizens Bank account.”

       With respect to the BB&T account in Kentucky, Agent Masterson explained that “initially

when Mr. Schroeder was interviewed . . . he said that he knew about the Kentucky bank account.”

Additionally, “[t]here was a check from the BB&T Bank account, the NCPEp bank account here in

Kentucky to Mr. Feeney’s law firm for $2,600 and change to pay for legal fees in 2008 form there.”

Agent Masterson also explained that Defendant should have reasonably foreseen Felner’s tax loss

relating to the $450,000 in checks issued from the University of Louisville because “two of the

checks were mailed directly to the Rock Island address of NCPEp and passed through Mr.

Schroeder’s hands. He sent them back via FedEx to Mr. Felner, and they were deposited into the

NCPEp bank account. The other check for $50,000, we found the invoice for that payment from U

of L in Mr. Schroeder’s office.”

       Based on Agent Masterson’s testimony and the other evidence admitted at trial, the district

court did not err when it found that Felner’s tax loss was a reasonably foreseeable consequence of

Defendant’s conspiracy with him. Furthermore, because Felner’s tax loss alone was above the

$400,000 threshold, any errors that the government or district court made when calculating

Defendant’s individual tax loss was harmless error.2

       B.        Substantive Reasonableness of Defendant’s Sentence

       Defendant further argues that the district court’s sentence was grossly disproportionate or

disparate when compared to the 63-month sentence Felner received, due to the fact that Felner was

more culpable and benefitted substantially more than Defendant from the conspiracy. Defendant also


       2
           At oral argument, Defendant’s counsel admitted that Felner’s tax loss was over $400,000.

                                                 21
claims that the district court should have departed from the guideline range because his offense level

of 22 overstated the gravity of his offense and he personally realized only a portion of the overall

gain. At the sentencing hearing, Defendant also argued that he should be considered as having only

a “minor role” in the conspiracy under U.S.S.G. § 3B1.2.

       Under 3B1.2, a judge should decrease the base offense level four levels for a minimal

participant and two levels for a minor participant. United States v. Lanham, 617 F.3d 873, 888 (6th

Cir. 2010). The judge found that “in order to apply this mitigating role, I would have to find that Mr.

Schroeder was substantially less culpable than even an average participant and that, based on the

evidence in this case, I cannot do.” See Lanham, 617 F.3d at 888 (quoting United States v. Lloyd,

10 F.3d 1197, 1220 (6th Cir. 1993)).

       The district court did not abuse its discretion by holding that Defendant was not entitled to

a downward departure. When making all reasonable inferences in favor of the prosecution, it cannot

be said that Defendant played a “minor role” in this conspiracy. He was the executive director of

NCPEp, and was close friends with Felner. Even before establishing NCPEp, they worked together

often through UofL, URI, and RICCA. Defendant had control over the AB&T account, and

authorized RICCA’s payments to Felner. Defendant also failed to give Timmer and his firm

requested information and instructions regarding Felner’s 1099s from both NCPEp and RICCA.

Accordingly, Defendant’s sentence is affirmed.

                                          CONCLUSION

       For the reasons stated above, we AFFIRM.




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