BEFORE THE UTAH STATE TAX COMMISSION
v. : INFORMAL DECISION
: Appeal No. 90-0127
COLLECTION DIVISION OF THE :
UTAH STATE TAX COMMISSION, : Account No. XXXXX
STATEMENT OF CASE
This matter came before the Utah State Tax Commission for a formal hearing on XXXXX. Paul F. Iwasaki, Presiding Officer, heard the matter for and in behalf of the Commission. Present and representing the Petitioner were XXXXX, attorneys at law. Present and representing the Respondent was XXXXX. The Petitioner was not present.
Based upon the evidence and testimony presented at the hearing, the Tax Commission hereby makes its:
FINDINGS OF FACT
1. The tax in question is income tax.
2. The periods in question are XXXXX. For the income tax years XXXXX, the Petitioner failed to file his state income tax returns in a timely manner. The Petitioner later filed returns for those years in XXXXX after having been ordered to do so by a Writ of Mandate issued by the District Court.
3. Returns for XXXXX have not been filed.
4. In approximately late XXXXX, a collection agent from the Tax Commission was assigned to the account. That individual spoke with the Petitioner personally on the telephone and notified the Petitioner of the necessity for him to file his income tax returns for the years in question. The Petitioner responded that he did not believe he had to file his state returns and that the filing of such returns were a waste of time.
5. In communications sent to the Petitioner by mail which described the penalty to be imposed, references were made to Utah Code Annotated §59-14A-92(4).
That provision makes it a crime for any person to knowingly or intentionally make, render, sign or verify any false or fraudulent return.
6. The appropriate provision upon which the penalty is based would have been §59-14A-92(5).
7. The Petitioner was not prejudiced by the incorrect citation of the statutory provision, nor was there any showing that Petitioner relied upon that error when he chose not to file his returns.
8. As a result of his failure to file his returns for the periods in question in an appropriate manner, the Petitioner was assessed a penalty in the amount of $$$$$ and interest applied at the statutorily prescribed rate.
CONCLUSIONS OF LAW
The Tax Commission is granted the authority to waive, reduce, or compromise penalties and interest upon a showing of reasonable cause. (Utah Code Annotated §59-1-401(8).)
DECISION AND ORDER
In the present case, the evidence is undisputed that the Petitioner was aware of his obligation to file an income tax return for each of the years in question and intentionally failed to do so.
Counsel for the Petitioner suggests that the citation of the wrong statutory provision somehow creates a fatal defect thus relieving the Petitioner from having to comply with the requirements to file or in preventing the imposition of penalties. No support for that proposition is found in any of the appropriate statutes, nor has counsel for the Petitioner cited any cases which would require such a result.
It should be noted that there was absolutely no showing that the Petitioner was prejudiced by the citing of the wrong statutory provision or that he relied upon that in any way to justify his failure to file the returns in a timely manner. Indeed, the Petitioner intentionally elected not to be present at the hearing to so testify if that was the case. Any conclusions that the Petitioner may have relied upon the error to his detriment are purely speculative and not worthy of consideration.
Counsel for the Petitioner also indicated that the error caused them to prepare a different defense to the allegations than might have been prepared had they been aware of the correct statutory provision upon which the allegation was based. If that were so, counsel for the Petitioner could certainly have requested a continuance in order to adequately prepare their case if they were unprepared, yet they elected not to do so. Given the evidence that was produced at the hearing however, it is unlikely that a different result would have been reached in any event.
Based upon the foregoing, the Tax Commission finds that sufficient evidence has not been shown which would justify a waiver or reduction of the penalties and interest for the periods in question. Therefore, the Petitioner's request to waive the penalties and interest associated with the XXXXX income tax years is denied. It is so ordered.
DATED this 26 day of June, 1990.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
R. H. Hansen Roger O. Tew
Joe B. Pacheco G. Blaine Davis