BEFORE THE UTAH STATE TAX
COMMISSION
_____________________________
In Re: ) FINDINGS
OF FACT,
: CONCLUSIONS
OF LAW,
XXXXX ) AND FINAL DECISION
:
: Appeal No.
90-1427
: 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 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 withholding tax.
2.
The period in question is the audit period XXXXX through XXXXX.
3.
Petitioner states that the withholding tax return and payment for the fourth
quarter of XXXXX was remitted timely by Petitioner to the Tax Commission. Tax
Commission records show no timely filing of the return or payment. Petitioner
remits its withholding taxes on a monthly basis. Tax Commission records show that the payment and return for XXXXX
was timely filed, but shows no timely payment for either XXXXX or XXXXX
XXXXX. No penalty or interest has been
imposed for XXXXX.
4.
Petitioner states that the payment and return were mailed timely and that the
payment was stapled to the return as is Petitioner's custom. Petitioner's copy
of the return does show staple marks in the upper left corner, but there is no
timely filed return in Tax Commission records.
5.
Petitioner submitted a photocopied carbon copy of the check and the
return. The check is written out for
the amount of tax due for both XXXXX and XXXXX XXXXX and is dated XXXXX, the
same date of the return. The return shows that only the monthly payment for
XXXXX had been previously paid. The
payment for XXXXX amounted to $$$$$. This left a balance due for XXXXX and
XXXXX of $$$$$, which is the amount of the XXXXX check. This indicates that the payment for XXXXX
had not been timely remitted.
6.
For several months, Petitioner did not notice that the check had not been
cashed. Petitioner states that it first
became aware of the problem through a sales tax audit performed by the Tax
Commission. Petitioner states that the
first written notification of the problem was not received by Petitioner until
the audit report was issued, dated XXXXX.
When Petitioner received a copy of the audit report, Petitioner stopped
payment on the original check and remitted a new check to the Tax Commission in
payment of the tax amount.
7.
A review of Petitioner's bank statement shows that Petitioner did have
sufficient funds in the bank to cover the original check when it was issued.
8.
It is Petitioner's position that the original check was included with the tax
return, that both were filed timely, but that the check was lost by the Tax
Commission.
9.
Petitioner has a good past and subsequent history of timely payment. Based on
these facts, Petitioner requests a waiver of the penalty and interest for the
period in question.
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
Under
the above facts, the Tax Commission finds that the penalty amount should be
waived only for the month of XXXXX. It
appears that Petitioner did make a timely payment of the XXXXX taxes and the
difficulties that developed because of the missing check were not due to any
fault of the Petitioner. Interest,
however, should not be waived because the state was deprived of the tax funds
in question for a period of time and should be compensated for that loss of
use. Additionally, Petitioner should
have become aware of the fact that the check had not been cashed long before
Petitioner did become aware of it and, therefore, the delay between the due
date of the tax in question and the actual payment by the second check is at
least partially due to the fault of Petitioner.
Regarding
the month of XXXXX, the evidence shows that the return and payment for that
month were not timely received and, therefore, the penalty and interest should
not be waived for that month.
Based
upon the foregoing, the Tax Commission finds that sufficient cause has been
shown which would justify a waiver of the penalty associated with the month of
XXXXX. The penalty associated with the
month of XXXXX is not waived. Interest
is not waived but shall be adjusted to account for the reduction of the
penalty. 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