91-0715 - Withholding Tax

 

BEFORE THE UTAH STATE TAX COMMISSION

______________________________

In Re: ) FINDINGS OF FACT,

: CONCLUSIONS OF LAW,

XXXXX ) AND FINAL DECISION

:

: Appeal No. 91-0715

: Account No. XXXXX

_____________________________

STATEMENT OF CASE

This matter came before the Utah State Tax Commission for a formal hearing on XXXXX. Alan Hennebold, Presiding Officer, heard the matter for and on behalf of the Commission. Present and representing the Petitioner was XXXXX owner.

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 XXXXX through XXXXX.

3. Petitioner is a XXXXX company. It primarily does business during the XXXXX and consequently hires a relatively large number of employees during those months.

4. Petitioner failed to file its annual withholding tax reconciliation for XXXXX. An office audit of Petitioner's withholding tax liability was conducted by Tax Commission staff in late XXXXX. Although Petitioner had paid its withholding tax liability and had provided W-2 forms to its employees, it could not produce copies of the forms for XXXXX employees. Also, Petitioner had not filed its annual withholding tax report (TC-96). Petitioner was assessed a penalty of XXXXX per form, for a total of XXXXX.

5. An additional audit adjustment was made to Petitioner's XXXXX withholding tax liability to correct a transposition error. The adjustment resulted in additional withholding tax of $$$$$, a 10% penalty of $$$$$, and interest.

6. Commission records indicate Petitioner has failed to timely file or pay its withholding tax liability for several other periods, both before and after 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

Petitioner has failed to exercise due care in its record-keeping for the period in question, as well as other periods. With respect to the period in question, Petitioner's negligence is mitigated by the inadvertent nature of its errors and the fact that it had paid the tax actually due, except for a small amount of tax hidden by a transposition error.

Based upon the foregoing, the Tax Commission finds that sufficient cause has been shown to justify reduction of the penalty associated with Petitioner's XXXXX withholding tax liability to the amount of $$$$$. It is so ordered.

DATED this 9th day of July, 1992.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

R. H. Hansen Roger O. Tew

Chairman Commissioner

Joe B. Pacheco S. Blaine Willes

Commissioner Commissioner