86-0271 - Income

BEFORE THE STATE TAX COMMISSION OF UTAH

_____________________________________

XXXXX, )

:

Petitioners, )

:

v. ) INFORMAL DECISION

:

)

COLLECTION DIVISION OF THE : Appeal No. 86 0271

STATE TAX COMMISSION OF UTAH, ) Acct. No. XXXXX

:

Respondent. )

_____________________________________

STATEMENT OF CASE

An Informal Hearing was scheduled for XXXXX. Petitioners subsequently waived their right to an oral hearing and requested a decision based on the file.

Petitioners' evidence indicates that on April 15, XXXXX, they filed an application for an automatic extension of time to file their individual income tax return. Along with the extension, they sent a check for $$$$$. On the extension application Petitioners indicated that they expected to owe $$$$$ in tax for the tax year XXXXX, and that their XXXXX income tax liability totaled $$$$$. On June 12, XXXXX, the Utah State Tax Commission received Petitioners' individual income tax return. Petitioners testified that they mailed along with the return a check in the amount of $$$$$. Petitioners' evidence indicates that because in past years the tax due to Utah was offset by tax paid to Montana, Petitioners did not expect to have a tax liability of $$$$$. However, along with the extension application, Petitioners' sent more than 100% of the previous year's tax liability in accordance with one of the two alternative requirements for filing an application for extension under Utah Code Ann. 59-14A-62(1) (Supp. 1986).

When Petitioners discovered that the check to the Utah State Tax Commission had not cleared their account, they contacted their accountant, XXXXX, who in turn contacted the Utah State Tax Commission. The Tax Commission indicated that there were some problems but not to worry. It was not until December 12, XXXXX, that the Petitioners were informed that a payment was not received with their return. The Petitioners sent a replacement check and requested a waiver of the penalties. Respondent denied the Petitioners' waiver request and indicated that the Petitioners did not meet the requirements for filing an extension.

Petitioners sent a copy of their general ledger to the Tax Commission which showed that on June 7, XXXXX, check no. XXXXX was written to the Utah State Tax Commission in the amount of $$$$$. Check no. XXXXX has never cleared the Petitioners' account which indicates that it was lost by the Tax Commission. Petitioners also sent photocopies of the fronts and backs of check nos. XXXXX and XXXXX.

DECISION AND ORDER

Based on the foregoing facts it is the Decision and Order of the Utah State Tax Commission that the penalty and interest assessed after June 12, XXXXX, be reduced to $$$$$.

The Respondent is therefore ordered to adjust its records in accordance with this decision.

DATED this 15 day of October, 1986.

BY ORDER OF THE STATE TAX COMMISSION OF UTAH.

R. H. Hansen Roger O. Tew

Chairman Commissioner

Joe B. Pacheco G. Blaine Davis *

Commissioner Commissioner