BEFORE THE STATE TAX
COMMISSION OF UTAH
_____________________________________
XXXXX
Petitioner, :
v. : INFORMAL DECISION
AUDITING
DIVISION OF THE : Appeal No. 87-2671
UTAH STATE TAX COMMISSION, :
Respondent. :
_____________________________________
STATEMENT OF CASE
This
is an appeal to the Utah State Tax Commission from an audit deficiency prepared
by Respondent on the purchase of a XXXXX from XXXXX in XXXXX on 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 Tax
Commission. XXXXX, Attorney at Law,
represented the Petitioner. XXXXX,
Supervising Auditor, represented the Respondent.
Petitioner
stated that he is an executive officer of XXXXX and many of its
subsidiaries. Petitioner stated that at
the time of purchase of automobile he was a resident of the state of XXXXX and
not of Utah. Petitioner stated that on
XXXXX XXXXX decentralized and became a holding company. Petitioner was appointed president of the
XXXXX operations. On XXXXX the office
became operational, and on XXXXX Petitioner was transferred to XXXXX. Petitioner purchased a home in XXXXX on
XXXXX. This home required extensive
remodeling which took longer than anticipated.
Petitioner's family moved in XXXXX.
XXXXX purchased Petitioner's XXXXX home on XXXXX, with the sale
retroactive to XXXXX. No deed was
recorded by XXXXX, however. Petitioner
had no remaining equity interest in the XXXXX home. Petitioner stayed in a XXXXX hotel until the new home was
finished. Since XXXXX Petitioner has
had XXXXX income taxes withheld from his compensation. On XXXXX Petitioner registered his children
in XXXXX. On XXXXX Petitioner purchased
the subject vehicle in XXXXX, and during the first week in XXXXX Petitioner's
family moved to XXXXX. Three weeks
prior to the purchase of the car, Petitioner renewed his Utah driver's license
because it was more convenient than getting a XXXXX license. Respondent determined a tax base of $$$$$,
assessed a sales and use tax (%%%%%) of $$$$$; assessed a %%%%% penalty of
$$$$$; and assessed interest of $$$$$ (%%%%% per month from XXXXX) for a total
amount due of $$$$$.
Respondent
presented a nonresident affidavit executed by Petitioner. Petitioner stated in
question no. 6 that he was not a resident of Utah and had not lived in Utah
within the past 60 days (prior to XXXXX).
Respondent noted that Petitioner listed a Utah driver's license number
in response to question no. 12 of the nonresident affidavit.
FINDINGS
The
Tax Commission finds that Petitioner was a resident of Utah at the time of
purchase pursuant to Tax Commission Rule R873-O1V. Subsection 3 states:
3. Any person, except a tourist temporarily
within this state, or a student covered under Rule R873-04V, who owns, leases,
or rents a residence or a place of business within this state, or occupies or
permits to be occupied, a Utah residence or place of business [is a
"resident"].
Petitioner's
family occupied a Utah residence at the time of purchase of the vehicle. They resided in the XXXXX home after
Petitioner transferred to XXXXX and through the first week of XXXXX. Petitioner, himself, had occupied the home
up to XXXXX--well within the 60 day period addressed in question 6 of the
nonresident affidavit. Subsection 6 of
Tax Commission Rule R873-O1V further defines the term "resident":
6. Any person declaring himself to be a
resident of Utah to obtain privileges not ordinarily extended to nonresidents,
such as going to school or placing children in school without paying
nonresident tuition or fees [is a resident].
Petitioner availed himself of privileges not ordinarily extended to
nonresidents when he renewed his Utah driver's license on XXXXX, four days after
he transferred to XXXXX. The Tax Commission
finds that Petitioner was a resident of Utah for motor vehicle registration
purposes at the time of the purchase of the subject vehicle. Respondent properly assessed tax and
interest on the purchase of the vehicle.
However, the Tax Commission finds that Petitioner's actions do not rise
to the level of intentional disregard of law or rule. Petitioner's actions demonstrate negligence.
DECISION AND ORDER
Based
on the foregoing, it is the decision and order of the Utah State Tax Commission
that Petitioner's petition for redetermination be denied with the exception
that a %%%%% negligence penalty be imposed in lieu of a %%%%% penalty for
intentional disregard of law or rule.
If Petitioner is able to provide evidence with ten (10) days of the date
of this decision that he paid use tax to XXXXX at the time he registered the
subject vehicle in XXXXX then the Tax Commission will, in its discretion, waive
the audit deficiency in its entirety.
If nothing is forthcoming with ten days then the audit deficiency shall
stand.
DATED
this 27 day of June, 1988.
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