BEFORE THE UTAH STATE TAX
COMMISSION
__________________________________
In Re: ) FINDINGS
OF FACT,
: CONCLUSIONS
OF LAW,
XXXXX ) FINAL DECISION
:
Appeal No.
90-1416 )
: Account
No. XXXXX
_____________________________________
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 Petitioner were
XXXXX and XXXXX. The Collection
Division of the Utah State Tax Commission was represented by 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 sales and use tax.
2.
The periods in question are the second and third quarters of XXXXX, the fourth
quarter of XXXXX, the third quarter of XXXXX, the second quarter of XXXXX, and
the second quarter of XXXXX.
3.
An individual named XXXXX filed a Chapter 11 bankruptcy in Utah on XXXXX, case
number XXXXX. Upon receipt of the
notice of bankruptcy, the Collection Division of the Utah State Tax Commission
ran a cross-reference in its records for business accounts and the name XXXXX
was attributed to Petitioner. The Tax
Commission thereafter filed a claim with the bankruptcy court for delinquent
sales tax and the attorney representing this XXXXX did not object to the Tax
Commission's claim. Petitioner's sales tax account was coded by the Collection Division
as "BK," signifying bankruptcy.
XXXXX of the Collection Division represented that once an account is so
coded, all notices from the Tax Commission to the taxpayer cease.
4.
It has since been discovered that the XXXXX that filed bankruptcy has a social
security number which is different from that of the XXXXX who is a principal of
Petitioner. The cross reference in the
Tax Commission's records which should normally be performed on social security
numbers apparently never was performed.
Neither Petitioner nor its principals are currently in bankruptcy, nor
have they ever been in bankruptcy.
Because of these difficulties, for the six year period between XXXXX
through XXXXX no sales tax notices were sent to Petitioner.
5.
When Petitioner began business operations in XXXXX, Petitioner obtained from
the Tax Commission a sales tax account number.
Petitioner was told it would receive quarterly returns in the mail from
the Tax Commission which would instruct it in the filing and payment of the
sales tax.
6.
In the following months, Petitioner did not receive any of the tax returns or
instructions which it was under the impression it would receive from the Tax
Commission. Consequently, in XXXXX,
Petitioner contacted the Tax Commission for instructions. Petitioner began receiving the tax return
forms by XXXXX but, apparently, the receipt of the returns since that time has
been inconsistent. For the fourth
quarter of XXXXX, Petitioner did not receive the tax returns in the mail. Petitioner contacted Tax Commission offices
and was told that it could pay the tax for that quarter with its next quarter's
taxes.
7.
Petitioner incorporated in XXXXX and contacted Tax Commission offices for
instructions. Petitioner was told that the
tax account number did not need to be changed and that Petitioner could
continue to file as in the past.
8.
Petitioner admits that the sales taxes for some quarters, e.g., the second
quarter of XXXXX, with a XXXXX postmark date on the envelope of the return, and
the third quarter of XXXXX, with a check dated XXXXX may have been paid late by
Petitioner by mistake. However,
Petitioner was never informed of any difficulties with its account, apparently
due to the bankruptcy, until XXXXX.
Petitioner states that it would have paid all tax and other charges if
it had received timely notification of the delinquencies.
9.
Based upon the foregoing, Petitioner requests that both penalties and interest
be waived since the difficulties in this case appear to have been caused by the
Tax Commission and not by Petitioner.
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
Based
upon the foregoing, the Tax Commission finds that sufficient cause has been
shown which would justify a waiver of the penalty and interest associated with
the second and third quarters of XXXXX, the fourth quarter of XXXXX, the third
quarter of XXXXX, the second quarter of XXXXX, and the second quarter of
XXXXX. It is so ordered.
DATED
this 6 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