BEFORE THE STATE TAX
COMMISSION OF UTAH
_____________________________________
XXXXX,
:
Petitioner, )
:
v. ) INFORMAL DECISION
:
)
COLLECTION
DIVISION OF THE : Appeal No. 86 0112
STATE TAX
COMMISSION OF UTAH, ) Acct. No. XXXXX
:
Respondent. )
_____________________________________
STATEMENT OF CASE
This
is an appeal to the Utah State Tax Commission from a decision of the Collection
Division of the Utah State Tax Commission (Respondent) to assess a penalty on
Corporate Franchise Tax Account No. XXXXX for the tax year XXXXX. An Informal Hearing was held on August 20,
1986, in the offices of the Utah State Tax Commission. James E. Harward, Hearing Officer, heard the
matter for the Tax Commission. XXXXX
represented the Petitioner.
During
XXXXX Petitioner changed accountants, effective January XXXXX. Prior to XXXXX
the books and records of Petitioner's corporate income tax account were
maintained in house by the office staff of the Petitioner. Petitioner's new
accountant thought this procedure would continue and expected a trial balance
of the books for XXXXX. Because of a
misunderstanding, no books and records of the corporate income tax account were
posted to the ledgers for XXXXX by the office staff of Petitioner. Once the misunderstanding was resolved,
Petitioner's accountant posted the records for XXXXX and compiled the data
required for the XXXXX tax return.
Respondent
assessed a 15% late filing penalty of $$$$$, a civil penalty of $$$$$, and
interest of $$$$$. Petitioner agrees to
pay interest but requests an abatement of the late filing penalty and civil
penalty.
FINDINGS
A
5% per month penalty is properly assessed if a return is not timely filed
unless it is shown that the failure to file the return was "due to
reasonable cause and not due to willful neglect." Utah Code Ann. § 59-13-27 (1953). Petitioner
did not meet the burden of proof to show that the failure to file a corporate
franchise tax return for the calendar year XXXXX was reasonable. Therefore, the late filing penalty is
applicable. Since Petition was three
months late, a 15% penalty applies.
A
civil penalty of $$$$$ is properly assessed against any person who
"without fraudulent intent, fails to make, render, sign or verify any
return, or to supply any information within the time required by or under the
provisions of this [Franchise or Privilege Taxes] chapter." Utah Code Ann. § 59-13-56(1) (1953).
Petitioner failed to timely file the return for the tax year XXXXX. Therefore, Petitioner is subject to the
civil penalty of $$$$$.
DECISION AND ORDER
It
is the Decision and Order of the Utah State Tax Commission that the request for
waiver of penalty on account No. XXXXX for the tax year XXXXX be denied.
The
assessment of penalty and interest by the Collection Division of the Utah State
Tax Commission is sustained.
DATED
this 7 day of October of 1986.
BY ORDER OF THE STATE TAX COMMISSION OF UTAH.
R. H. Hansen Roger
O. Tew
Chairman Commissioner
ABSENT
Joe B.
Pacheco G.
Blaine Davis *
Commissioner Commissioner
* Since the hearing on this case,
Chairman Mark K. Buchi has resigned and R. H. Hansen has been appointed as the
Chairman for the Commission. G. Blaine
Davis has been appointed as a Commissioner and has been duly advised of the
facts and circumstances regarding this case and is qualified to sign this
decision.