BEFORE THE UTAH STATE TAX COMMISSION
Petitioner, ) FINDINGS OF FACT,
) CONCLUSIONS OF LAW,
v ) AND FINAL DECISION
) Appeal No. 90‑0121
COLLECTION DIVISION OF THE )
STATE TAX COMMISSION OF UTAH, )
) Acct No. XXXXX
STATEMENT OF CASE
This matter came before the Utah State Tax Commission pursuant to the Utah Administrative Procedures Act for a formal hearing on XXXXX, before Joseph G. Linford, Presiding Officer. Petitioner was represented by XXXXX, Attorney; XXXXX, CPA; and XXXXX. No one representing the Respondent appeared.
Based upon the evidence and arguments of the parties in the record, and the recommendation of the presiding officer, the Tax Commission hereby makes its:
FINDINGS OF FACT
1. The tax in question is sales and use tax.
2. The period in question is the second quarter of XXXXX.
3. For the time period in question, Petitioner failed to file and pay the required prepayment which was due on XXXXX. Petitioner did file and pay the sales taxes for that quarter at the regular deadline for payment. Petitioner states that its failure to file and pay the prepayment in a timely manner was due to the "irregular nature" of the prepayment law, and that its newly hired accountant was unfamiliar with the prepayment requirements. Petitioner believes, although it is not certain, that the prepayment form from the Tax Commission was never received.
4. Petitioner requests a waiver of the penalty and interest in this case based upon the following factors: 1) The unfamiliarity of Petitioner's accountant with the prepayment requirements; 2) the "unduly penal" nature of the penalty imposed upon the Petitioner; 3) the delay of the Tax Commission in acting upon the Petitioner's initial waiver request; 4) Petitioner's good past and subsequent history in the payment of its sales and use taxes, including the prepayment.
CONCLUSIONS OF LAW
1. Utah Code Ann. ''59‑1‑401 and 59‑1‑402 provide that penalties and interest shall be assessed for the late payment and filing of taxes, including the prepayment of sales and use taxes.
2. Utah Code Ann. '59‑1‑401(8) provides that upon reasonable cause shown, the Tax Commission may waive or reduce penalties and interest assessed under the above statutes.
3. Such reasonable cause has not been shown in this case. Petitioner admits that it was late in filing and paying the prepayment taxes for the period in question. Although Petitioner's new accountant may have been unfamiliar with the provisions of the prepayment law, Petitioner has in previous years been required to make the prepayment and has done so. Petitioner had a duty to inform its new accountant of the requirement.
A taxpayer's negligence is not sufficient cause for waiver of penalty and interest assessments.
4. As to Petitioner's contention that the application of the penalty is unduly penal and unfair to Petitioner, the Tax Commission notes that this penalty was assessed according to law and is not excessive under that law.
5. Concerning the alleged delay of the Tax Commission in acting upon Petitioner's request for a waiver, resulting in an allegedly undue increase in the interest amounts assessed, the Commission points out that any taxpayer, at the time of requesting a waiver, may pay the entire amount due (tax, penalty, and interest) under protest. This would stop the accumulation of interest. If the taxpayer's petition for waiver is favorable, a refund would be appropriate. Petitioner did not avail itself of this opportunity.
6. As to Petitioner's good past and subsequent history in timely filing and payment, this factor alone, though commendable, is not sufficient cause for waiver of the penalty and interest assessed.
7. Petitioner states that the calculation of the penalty amount is in error and that the penalty amount, according to the statute, should be ten percent of the amount due shown on Petitioner's prepayment form for the period in question. That amount due was $$$$$. The proper penalty at ten percent should have been $$$$$ rather than the $$$$$ originally assessed.
DECISION AND ORDER
Based upon the foregoing, it is the decision and order of the Utah State Tax Commission that Petitioner's request for waiver of penalty and interest is denied. The penalty amount should be ten percent of the amount due shown on Petitioner's prepayment sales tax return for the period in question.
DATED this 5 day of October, 1990.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
R. H. Hansen Roger O. Tew
Joe B. Pacheco G. Blaine Davis
NOTICE: You have twenty (20) days after the date of the final order to file a request for reconsideration or thirty (30) days after the date of final order to file in Supreme Court a petition for judicial review. Utah Code Ann. '' 63‑46b‑13(1), 63‑46b‑14(2)(a).