BEFORE THE STATE TAX
COMMISSION OF UTAH
_____________________________________
XXXXX, )
:
Petitioner, )
:
v. ) INFORMAL DECISION
:
)
COLLECTION
DIVISION OF THE : Appeal No. 86 0410
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 penalty and
interest on sales and use tax account No. XXXXX for the fourth quarter of
XXXXX, all of XXXXX, and the first three quarters of XXXXX. An Informal Hearing was held on XXXXX, in
the offices of the Utah State Tax Commission.
David J. Angerhofer, Hearing Officer, heard the matter for the
Commission. XXXXX represented the
Petitioner.
Petitioner
stated that on XXXXX, he purchased XXXXX and changed the corporate name to
XXXXX. At the time of purchase,
Petitioner met with XXXXX of the Tax Commission to find out the tax liabilities
in order to determine whether Petitioner should buy only the assets or to buy
the stock of the corporation.
Petitioner
stated that the Tax Commission was able to determine the tax liability for
Petitioner but could not give Petitioner figures for interest or penalty at
that time and that XXXXX told him that the penalty would be waived under these
circumstances.
Petitioner
stated that XXXXX has paid off in excess of $$$$$ in delinquent FICA, State Withholding
and Utah State Sales Taxes which its predecessor in interest had
accumulated. Petitioner paid the
interest charges as soon as the Tax Commission determined the amount and
notified him. Petitioner requests a waiver of the penalty.
Respondent
assessed a total penalty of $$$$$, and associated interest for the tax periods
in question.
FINDINGS
Petitioner
followed the proper procedure by consulting with the Tax Commission before
purchasing XXXXX. Petitioner as
successor in interest would be liable for all taxes, penalty and interest of
XXXXX. Therefore, a determination of
the amount of tax, penalty and interest due and owing was a critical factor of
the decision of Petitioner to buy the company and not just the assets.
Petitioner
has timely filed all taxes ever since Petitioner purchased XXXXX. The Commission finds that Petitioner in good
faith acquired the stock and not just the assets of its predecessor in
interest, and recognizes that this course of action resulted in the prompt
payment of delinquent taxes and associated interest which otherwise would have
been more difficult to collect.
The
Commission reduces the penalty to $$$$$, but does not waive it entirely since
Petitioner should have sought written waiver of penalty instead of merely submitting
a check for the interest and assuming that the penalty would be waived, and
instead of allowing sixteen months to elapse before further correspondence was
exchanged.
DECISION AND ORDER
It
is the Decision and Order of the Utah State Tax Commission that penalty on
sales and use tax account No. XXXXX be reduced to $$$$$.
The Collection Division of the Utah State Tax
Commission is ordered to adjust its records in accordance with this decision.
DATED
this 1 day of December, 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