BEFORE THE UTAH STATE TAX COMMISSION
In Re: ) FINDINGS OF FACT,
: CONCLUSIONS OF LAW,
XXXXX ) AND FINAL DECISION
: Appeal No. 91-0700
: 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
the matter for and on behalf of the Commission. Present and representing the Petitioner were XXXXX, and 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 tax.
2. The periods in question are the third quarter of XXXXX, and the first and second quarters of XXXXX.
3. Petitioner purchased an orthodontic practice from XXXXX, in XXXXX. XXXXX had worked for XXXXX, and continued at the same office to work for Petitioner after the purchase had occurred. The individual who had taken care of XXXXX tax matters instructed XXXXX as to how to handle the tax matters, and told XXXXX that XXXXX had been filing sales taxes on a yearly basis. This XXXXX continued to do.
4. When Petitioner purchased the practice from XXXXX, a new tax account was established for Petitioner. At this time the Tax Commission began assessing Petitioner tax on a quarterly rather than a yearly basis.
5. Petitioner asserts that he never received any notice of the requirement to file on a quarterly basis, nor did he receive any quarterly sales tax returns for the periods in question from the Tax Commission. Therefore, Petitioner filed sales tax for the year XXXXX at the usual time, i.e., XXXXX.
6. Petitioner states that he does not remember receiving any forms or instructions from the Tax Commission at the time he established his new tax account with the Commission. The first that Petitioner became aware of the difficulty with the account was on XXXXX, when Petitioner received a failure to file notice for the periods in question. Petitioner immediately called Tax Commission offices to inquire into the difficulty. This was the first indication, according to Petitioner, that he was ever given of his quarterly filing status. The person at the Tax Commission with whom Petitioner spoke said that she would send quarterly report forms to Petitioner, which she did. Petitioner began receiving these report forms in XXXXX, and has been filing quarterly tax returns since that time.
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 above circumstances, the Tax Commission finds that reasonable cause has been shown for a waiver of the penalty in this case. Interest, however, should not be waived because the state was deprived of the use of the tax funds in question for a period of time and should be compensated for that loss of use.
Based upon the foregoing, the Tax Commission finds that sufficient cause has been shown which would justify a waiver of the penalty associated with Petitioner's sales taxes for the third quarter of XXXXX, and the first and second quarters of XXXXX. Interest is not waived, but shall be adjusted to account for the waiver of the penalty. It is so ordered.
DATED this 25th day of June, 1991.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
R. H. Hansen Roger O. Tew
Joe B. Pacheco G. Blaine Davis