BEFORE THE STATE TAX
COMMISSION OF UTAH
_____________________________________
XXXXX
Petitioner, :
v. : FINDINGS OF FACT,
: CONCLUSIONS
OF LAW, &
: FINAL
DECISION
COLLECTION
DIVISION OF THE : Appeal No. 88-0645
STATE TAX
COMMISSION OF UTAH, ) Acct. No. XXXXX
Respondent. :
_____________________________________
STATEMENT OF CASE
A
prehearing conference was held on XXXXX in the offices of the Utah State Tax
Commission. David J. Angerhofer,
Presiding Officer, heard the matter for the Tax Commission. XXXXX represented the Petitioner. During the course of the prehearing conference
the presiding officer converted the proceeding to a formal hearing.
Petitioner
stated that an extension request was timely filed on individual income tax
account No. XXXXX for the tax year XXXXX.
Petitioner stated that he underestimated the tax due on the application
for extension and acknowledged a one percent penalty, but requested an
abatement of the remainder of the penalty.
FINDINGS OF FACT
Petitioner
prepared an extension request, form TC-546, on XXXXX. On this form the Petitioner estimated that no tax would be due
for the tax year XXXXX and calculated that nothing need be paid at the time the
extension request was filed. Petitioner
filed a subsequent extension request on XXXXX, which request extended the due
date until XXXXX. On XXXXX the Petitioner
filed a Utah resident long form individual income tax return, form TC-40. The actual tax due for the tax year XXXXX
amounted to $$$$$. $$$$$ had been previously credited to Petitioner's account
for the tax year XXXXX pursuant to W-2 withholding leaving a balance due of
$$$$$.
Petitioner
submitted a check in the amount of $$$$$ when the return was filed. Petitioner did not, however, pay the accrued
interest.
Respondent
assessed a 10 percent late filing penalty and a 10 percent late payment penalty
pursuant to Utah Code Annotated Section 59-1-401 (1953) and assessed associated
interest.
CONCLUSIONS OF LAW
The
preponderance of the evidence indicates that Petitioner did timely file an
extension request on individual income tax account No. XXXXX for the tax year
XXXXX. However, the extension request
underestimated the amount of tax due.
Since the amount of payment remitted with the extension request (none)
was less than 80 percent of the total tax reported when the tax return was
filed and was less than the total tax paid on the income tax return for the tax
year XXXXX, a penalty was properly due pursuant to Section 59-10-516(c) and
Section 59-1-401(2)(b). The proper
penalty is 2 percent per month of the unpaid tax during the extension period.
Petitioner
was required to remit interest along with the tax when Petitioner filed the
return on XXXXX pursuant to Section 59-10-537(5). Since Petitioner failed to remit interest Petitioner underpaid
the tax on XXXXX and was subject to a late payment penalty of $$$$$ or 10
percent of the balance due, whichever is greater.
FINAL DECISION
Based
on the foregoing, the Utah State Tax Commission imposes a two percent per month
penalty on individual income tax account No. XXXXX during the period of
extension for the tax year XXXXX and imposes a $$$$$ late payment penalty for
failure to pay interest when the extension period expired.
The
Collection Division of the Utah State Tax Commission is hereby ordered to
adjust its records in accordance with this decision.
DATED
this 31 day of October, 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