BEFORE THE UTAH STATE TAX
COMMISSION
_________________________
XXXXX :
Petitioner, : FINDINGS OF FACT,
: CONCLUSIONS
OF LAW,
v. : AND FINAL DECISION
:
AUDITING
DIVISION OF THE : Appeal No. 91-0919
UTAH STATE TAX COMMISSION :
: Account
No. XXXXX
Respondent :
_____________________________
STATEMENT OF CASE
This
matter came before the Utah State Tax Commission based on stipulated facts
submitted by the parties. Alan
Hennebold, Administrative Law Judge, presided for and on behalf of the
Commission.
Based
upon the stipulated facts and the documentary record in this matter, the Tax
Commission hereby makes its:
FINDINGS OF FACT
1. The tax in question is sales tax, together
with associated penalty and interest, arising from Petitioner's purchase of
XXXXX in Utah.
2. The date in question is XXXXX.
3. The Petitioner is married to a XXXXX
resident. However, she considers
herself to be a resident of XXXXX. She
was raised in XXXXX and her family continues to reside there. She and her husband own a residence in
XXXXX, where she spends approximately XXXXX of her time. The remaining XXXXX of her time is spent in
Utah. She also owns XXXXX and other
XXXXX in XXXXX, where she is registered to vote, maintains a checking account
and maintains vehicles registered in that state. The Petitioner is not employed in Utah. She does maintain another vehicle licensed, registered and
located in Utah for her use while in Utah.
4. The Petitioner's husband is employed in
Utah. As of the date in question,
Petitioner's husband resided in a home in Utah that he owned with
Petitioner. The home has now been
sold. After its sale, Petitioner's
husband resided in an XXXXX, then a XXXXX.
5. The Petitioner has previously maintained a
Utah driver's license. She surrendered her Utah license sometime prior to
XXXXX.
6. On XXXXX, Petitioner purchased a vehicle
from an automobile dealership in XXXXX Utah, for $$$$$. The Petitioner intended to drive the vehicle
back to XXXXX during XXXXX. She paid the
applicable XXXXX use tax on the purchase of the vehicle to XXXXX. The vehicle has been virtually undriven
since its purchase.
7. In connection with her purchase of the
foregoing vehicle, the Petitioner completed and signed a "Non-Resident
Affidavit" in which she stated she was a resident of XXXXX. She further stated that she had not been a
resident of Utah or lived within Utah during the previous sixty days.
She
did not complete the portion of the affidavit which requested a driver's
license number. The affidavit did not
contain the Commission's rules for determining resident status for sales tax
purposes.
8. Based upon the foregoing Non-Resident
Affidavit, no sales tax was collected from the Petitioner on the automobile
purchase.
9. The Respondent, Audit Division, concluded
that the foregoing transaction was subject to Utah sales tax because Petitioner
was a resident of the State of Utah for sales tax purposes. It therefore assessed sales tax against
Petitioner in the sum of $$$$$. It
assessed a further penalty of 15% of the tax due, or $$$$$, on the grounds the
Petitioner had executed her Non-Resident Affidavit in intentional disregard of
Utah's Sales and Use Tax Act. It also assessed associated interest against
Petitioner.
CONCLUSIONS OF LAW
Utah
Code Section 59-12-104(9) exempts from sales tax the purchase of vehicles to
bona fide non-residents of this state if such vehicles are not thereafter
registered or used in Utah except as necessary to transport them out of Utah.
Rule
R873-22l-M (Utah Administrative Code 1990-91) defines "resident" as,
among other things, every person who owns, leases or rents a resident within
Utah.
DECISION AND ORDER
In
this case, the undisputed evidence establishes that the Petitioner has
significant contacts with the State of Utah.
She spends a substantial portion of her time in the state, was at the
time in question a part owner of a residence in the state, and maintains an
automobile in the state. She also
possessed a Utah driver's license. The
foregoing circumstances are sufficient under the provisions of Utah law and
administrative rule set forth above to impose upon Petitioner the obligation to
pay sales tax to Utah upon her purchase of the automobile in question. This is true even though Petitioner may
consider herself a resident of XXXXX and have significant connections with that
state. The Commission therefore affirms
the Respondent's imposition of sales tax against Petitioner in this matter.
With
respect to the imposition of penalty against Petitioner for her failure to pay
sales tax, the Commission notes her reasonable belief that as a resident of
XXXXX, she was not liable for Utah sales tax.
The Commission also notes that the particular "Non-Resident
Affidavit" which was presented to Petitioner when she purchased the
vehicle in question did not contain the usual statement of the Commission's
rules. Under such circumstances, the
Commission concludes that good cause exists to waive the penalty which has been
assessed against Petitioner. Interest
is not waived, however.
In
summary, the Tax Commission finds that the transaction in question is subject
to Utah sales tax and therefore affirms the Respondent's assessment of sales
tax in the amount of $$$$$. The Tax
Commission finds reasonable cause to waive the penalty of $$$$$ previously
imposed against Petitioner. Interest is not waived. It is so ordered.
DATED
this 10th day of December, 1991.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
ABSENT
R. H. Hansen Roger
O. Tew
Chairman Commissioner
Joe B.
Pacheco S.
Blaine Willes
Commissioner Commissioner