BEFORE THE STATE TAX
COMMISSION OF UTAH
_____________________________________
XXXXX
Petitioner, :
v. : INFORMAL DECISION
:
COLLECTION
DIVISION OF THE : Appeal No. 88-0610
STATE TAX
COMMISSION OF UTAH, ) Acct. No. XXXXX
Respondent. :
_____________________________________
STATEMENT OF CASE
This
is an appeal to the Utah State Tax Commission for reconsideration of a Commission
decision denying a request for waiver of penalty and interest assessments on
Petitioner's XXXXX quarterly withholding returns and first quarter XXXXX
return. Pursuant to Utah Code Ann.
§63-46b-5(1)(b), no hearing withheld. A review of Petitioner's file served as
the evidentiary basis for this decision.
Petitioner,
XXXXX, failed to file timely withholding returns for all quarters of XXXXX and
for the first quarter of XXXXX, and was assessed late filing penalties and
interest. Petitioner asserts that his
accountant failed to notify him of any tax due, and asks that the penalty and
interest assessments be waived for this reason. Alternatively, the Petitioner argues that the penalties are
excessive, arbitrary, and inconsistent, and should be adjusted to reflect more
equitable penalty and interest assessments.
FINDINGS
Utah
Code Ann. §59-10-406 provides that withholding returns are due on the last day
of the month following the calendar quarter and that failure to timely file
these returns subjects the employer to liability for penalty and interest
assessments. Utah Code Ann.
§59-1-401(1)(b) provides that a penalty of the greater of $$$$$ or 10 percent
of the tax due shall be assessed for failure to file timely returns. An additional penalty of the greater of
$$$$$ or 10 percent of the tax due shall be assessed for failure to remit the
tax due within 90 days of the due date.
Petitioner's
failure to timely file the returns and remit the tax due within the 90 days
allowed by law subjected him to liability for penalties of as much as $$$$$
(XXXXX late filed returns at $$$$$ each and XXXXX late payment penalties at
$$$$$ each). Utah Code Ann. §59-1-402
authorizes the Commission to assess interest charges at the rate of 12 percent
annually on unpaid tax. Any payments
are credited first to penalty, then to interest, and finally to tax.
Although
the Commission has the authority to waive any penalty and interest assessments,
the Commission will do so only upon a showing that noncompliance was due to
reasonable cause. Reliance upon tax
accountants may, in unusual circumstances, be seen as reasonable cause for
noncompliance, however, the ultimate responsibility for filing and payment of
taxes always remains with the taxpayer.
In this case, Petitioner's reliance on a tax accountant, absent evidence
to the contrary, cannot be considered reasonable cause.
Further
review of Petitioner's account shows that Commission errors have caused the
Petitioner's account to be assessed penalties less than those legally allowed. However, the Commission will except payment
of these penalty and interest assessments as payment in full.
DECISION AND ORDER
Based
on the foregoing facts, it is the Decision and Order of the Utah State Tax
Commission that the request for waiver of penalty and interest assessments be
denied.
DATED
this 29 day of September, 1988.
BY ORDER OF THE STATE TAX COMMISSION OF UTAH.
FOR THE COMMISSION
G. Blaine
Davis
Commissioner