90-1127 - Individual Income

 

BEFORE THE UTAH STATE TAX COMMISSION

_____________________________

In Re: ) FINDINGS OF FACT,

: CONCLUSIONS OF LAW,

XXXXX ) AND FINAL DECISION

:

: Appeal No. 90-1127

: Account No. XXXXX

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STATEMENT OF CASE

This matter came before the Utah State Tax Commission for a formal hearing on XXXXX. Joseph G. Linford, Presiding Officer, heard the matter for and on behalf of the Commission. Present and representing the Petitioners was XXXXX.

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 individual income tax.

2. The period in question is the tax year XXXXX.

3. Petitioner, XXXXX, was temporarily employed in XXXXX for all of the year in question. XXXXX's family remained at their home in Utah. XXXXX visited on weekends and maintained his voting status in Utah.

4. When the time came to pay his income taxes for the year in question, XXXXX's employer maintained that XXXXX should pay XXXXX taxes as a resident of XXXXX. Petitioners and their accountant were of the opinion that XXXXX was still a resident of Utah and should pay Utah taxes. XXXXX's W-2 form, issued by his employer, showed XXXXX as his state of residence.

5. Because of the dispute with XXXXX's employer, an extension was timely filed by Petitioners in Utah with a $$$$$ extension prepayment. When it was determined that XXXXX was a resident of Utah and should pay Utah taxes, it was discovered that the prepayment was inadequate to validate the extension. Petitioners did, however, pay all tax due with interest to the date of payment before the extension deadline.

6. Petitioners allege that because of this confusion they did not know the amount of Utah taxes which they owed for the year in question and, therefore, did not know the proper amount for the prepayment. Penalty and interest was assessed because of the insufficient amount of the prepayment. Petitioners now request a waiver of the penalty and interest.

7. Petitioners' account also has some history of penalty and interest assessment for prior years.

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 Ann. 59-1-401(8).)

DECISION AND ORDER

A showing of reasonable cause requires that the circumstances which lead to the assessment of the penalty and interest be circumstances beyond the control of the taxpayer which renders it impossible for the taxpayer to avoid the difficulties which lead to the assessment of the penalty and interest. In this case, Petitioners could have avoided these difficulties. Although there may have been some confusion on Petitioners' part, it appears that Petitioners had sufficient information to have made an accurate determination of the amount of taxes they would be required to pay in Utah and could have made a more accurate estimate for the prepayment. The disagreement with XXXXX's employer did not preclude Petitioners from making a proper prepayment.

Based upon the foregoing, the Tax Commission finds that sufficient cause has not been shown which would justify a waiver of the penalty and interest associated with the tax year XXXXX. It is so ordered.

DATED this 15 day of February, 1991.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

ABSENT

R. H. Hansen Roger O. Tew

Chairman Commissioner

Joe B. Pacheco G. Blaine Davis

Commissioner Commissioner