BEFORE THE UTAH STATE TAX COMMISSION
v. : INFORMAL DECISION
: Appeal No. 90-0998
COLLECTION DIVISION OF THE :
UTAH STATE TAX COMMISSION, :
: Account No. XXXXX
STATEMENT OF CASE
This is an appeal to the Utah State Tax Commission requesting waiver of penalty and interest assessment on Petitioner's sales and use tax return for the second quarter of XXXXX. Pursuant to Utah Code Ann. §63-46b-5(1)(b,j), no hearing was held. A review of Petitioner's file served as the evidentiary basis for this decision.
This was the first quarter for which Petitioner was required to make a sales tax prepayment and Petitioner states that it was confused by the requirement and mistakenly paid it after the deadline. By letter dated XXXXX, the Tax Commission waived all penalties in the case, leaving the remaining balance of interest due of $$$$$. Petitioner has already paid the tax amount of $$$$$. Petitioner now requests a waiver of the interest, stating that the interest is assessed on the penalty, and since the penalty has been waived, the interest should also be waived.
Utah Code Ann. §§59-1-401 and59-1-402 provide that penalties and interest shall be assessed for the late payment and filing of taxes. Utah Code Ann. §59-1-401(8) provides that upon reasonable cause shown, the Tax Commission may waive or reduce penalties assessed under the above statutes.
Such reasonable cause has not been shown in this case. When payments are made to the Tax Commission, they are first applied, as in this instance, to the penalty, then to interest, and then to the tax amount. This leaves an amount of tax still owing upon which interest continues to accrue. Therefore, some interest on the tax amount is due and payable.
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 interest is denied. It is also ordered that the interest amount shall be recalculated to take into account the waiver of the previous penalty if not already recalculated. It is so ordered.
DATED this 20 day of August, 1990.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
R. H. Hansen Roger O. Tew
Joe B. Pacheco G. Blaine Davis