BEFORE THE UTAH STATE TAX COMMISSION
In Re: ) FINDINGS OF FACT,
: CONCLUSIONS OF LAW,
XXXXX ) AND FINAL DECISION
: Appeal No. 90-2688
: 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 fiduciary income tax.
2. The period in question is the tax year XXXXX.
3. In XXXXX, XXXXX was acquired by XXXXX. Most of the employees who worked for XXXXX subsequently left employment under XXXXX. The XXXXX was also moved to a new location. These former employees told XXXXX that the taxes for this account and several others had been taken care of and paid.
4. The fact that the return had not been filed for XXXXX was not discovered by the new XXXXX employee until XXXXX, at which time XXXXX prepared the return for the year in question and submitted it to the Tax Commission. XXXXX testified that this new employee in the XXXXX was untrained and did not properly deal with the account in question in order to ensure that the tax was paid in a timely manner.
5. XXXXX testified that this case is one among several other cases in which XXXXX has dealt with the same problem, and in all of those cases under these same circumstances and for the same period in question, the penalties have been waived informally by the Tax Commission. XXXXX also testified that extensions for all of these accounts have been filed and that subsequent returns have been timely.
6. Tax Commission records indicate that the circumstances which led to the penalty abatements in the other cases to which XXXXX refers were different circumstances than those of this case. For example, in these other cases the penalty was waived because it was only a nominal amount, or because of some delay by the Tax Commission in acting on waiver requests, or where penalties and interest were erroneously imposed by the Tax Commission even though the taxpayer conformed with appropriate extension requirements. None of these factors are apparent in this case.
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
XXXXX is responsible for the actions of its employees. The facts show that errors were made by those employees, because of lack of training or otherwise, and the negligence penalty is appropriate. XXXXX has a duty to train its employees adequately and to ensure that the employees comply with the law.
Based upon the foregoing, the Tax Commission finds that sufficient cause has not been shown to justify a waiver of the penalty associated with the tax year XXXXX. It is so ordered.
DATED this 2 day of April, 1991.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
R. H. Hansen Roger O. Tew
Joe B. Pacheco G. Blaine Davis