Withholding Tax

Signed 3/15/91




In Re: )


XXXXX ) Appeal No. 91‑0002

: Account No. XXXXX




This matter came before the Utah State Tax Commission pursuant to the Administrative Procedures Act and the rules of the Utah State Tax Commission for informal proceedings. No hearing was requested, therefore, this decision is based upon information contained in the Tax Commission's file.


The tax in question in this case is Petitioner's withholding tax for the first quarter of XXXXX. Petitioner's withholding tax report and payment were mailed to the Tax Commission on XXXXX.

Petitioner was informed by the Tax Commission on XXXXX, that the withholding tax return and payment had not been received by the Tax Commission. Petitioner immediately put a stop payment request on the original check (XXXXX) and issued a second check (XXXXX) along with a copy of the withholding tax return.

Petitioner was notified in XXXXX that the payment and return had still not been received by the Tax Commission. Petitioner issued another check which was hand delivered to the Tax Commission and a receipt was received by Petitioner.

On XXXXX, Petitioner received a telephone call from the Tax Commission indicating that Tax Commission employees had found check XXXXX, which had been issued on XXXXX. Apparently this check and its accompanying return had been lost and had only just been located by the Tax Commission. This check was returned to Petitioner.

The above facts indicate that the penalty in this case should be waived. It appears that Petitioner did mail the tax return and payment in a timely manner, and the fact that it was not received in a timely manner by the Tax Commission was not due to any fault of the Petitioner.

Regarding the interest assessment, the Tax Commission finds that it should not be entirely waived. While there is some indication that there were difficulties which may have been caused by Tax Commission personnel by the temporary loss of check XXXXX and its accompanying return, there is no indication that any problem was caused by the state as to the receipt of check XXXXX and its accompanying return which were originally mailed in XXXXX. The state was deprived of the use of the tax funds in question for a period of time, through no fault of its own, and should be compensated for that loss of use. Therefore, interest should only be reduced to the amount accrued as of XXXXX, the date of the first replacement check (XXXXX) which was temporarily lost, and interest amounts accruing after this date should be waived.


The Tax Commission finds that sufficient cause does exist to waive the penalty associated with the withholding tax for the first quarter of XXXXX. Interest is reduced to the amount which had accrued up until XXXXX, adjusted to account for the waiver of the penalty. Interest amounts accruing after that date are waived. It is so ordered.

DATED this 15 day of March, 1991.


R. H. Hansen Roger O. Tew

Chairman Commissioner


Joe B. Pacheco G. Blaine Davis

Commissioner Commissioner


NOTICE: You have twenty (20) days after the date of the final order to file a request for reconsideration or thirty (30) days after the date of final order to file in District Court a petition for judicial review. Utah State Tax Commission Administrative Rule R861‑5A‑l(p) and Utah Code Ann. '63‑46b‑14(3)(a).