Corporation Franchise

Signed 5/21/91





XXXXX ) Appeal No. 91‑0034

) 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. Petitioner had initially requested a hearing in this case, which had been set for XXXXX, but later requested that the case be decided upon the information contained in the Tax Commission's file.


The tax in question in this case is corporate franchise tax for the period XXXXX through XXXXX. Petitioner states that it did not receive the appropriate form (form TC‑20) from the Tax Commission for filing its taxes for the period in question, but did receive a booklet containing four (4) forms TC‑20 ES, Utah Estimated Corporation Franchise Tax Prepayment forms. Petitioner cites the Commission's attention to a paragraph in the general information section of the TC‑20 ES booklet that reads as follows:

"Every corporation subject to a corporate franchise tax by the State of Utah and expecting to have a Utah tax liability of $$$$$ or more in the current year, or every corporation which had a tax liability of $$$$$ or more in the previous tax year, must make estimated tax prepayments of not less than 90% of the anticipated tax liability."

Petitioner did not anticipate any tax liability for the period in question. In the previous tax year, Petitioner had a tax liability, which it paid, in the amount of the $$$$$ minimum tax. Based on the above, the Petitioner concluded that there was no tax liability for the period in question and, therefore, did not file a return. The instructions included with the forms TC‑20 ES did not state that a minimum tax was required.

Although Petitioner should have been aware of the requirement to pay the $$$$$ minimum tax for the period in question because Petitioner had made that payment in previous years, the Tax Commission finds that the Penalty should be waived because Petitioner had received the wrong tax forms and instructions from the Commission which was the cause of the confusion in this case. To a taxpayer in Petitioner's situation, the instructions cited by Petitioner could be confusing if the taxpayer relied solely upon those instructions. However, although the Commission finds that the penalty should be waived, the Commission emphasizes that Petitioner should have obtained and relied upon the complete instructions included with the usual return (form TC‑20), with which Petitioner was familiar because Petitioner had filed the form TC‑20 in the past.


The Tax Commission finds sufficient cause does exist to waive the penalty associated with Petitioner's corporation franchise tax for the period XXXXX through XXXXX. Interest shall be adjusted to account for the waiver of the penalty. The XXXXX hearing date is stricken. It is so ordered.

DATED this 21 day of May, 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).