91-1324 - Withholding Tax

 

BEFORE THE UTAH STATE TAX COMMISSION

_____________________________

In Re: ) FINDINGS OF FACT,

: CONCLUSIONS OF LAW,

XXXXX ) AND FINAL DECISION

:

: Appeal No. 91-1324

: Account No. XXXXX

______________________________

STATEMENT OF CASE

This matter came before the Utah State Tax Commission for a formal hearing on XXXXX. Lisa L. Olpin, Presiding Officer, heard the matter for and on behalf of the Commission. Present and representing the Petitioner was XXXXX, Financial Director for Petitioner.

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 the month of XXXXX.

3. Petitioner is a XXXXX and XXXXX. It acknowledges that its accounting department has had difficulty in the past keeping up with the success of the company and its financial affairs.

4. Most recently, Petitioner was late in filing and paying withholding taxes that were due in XXXXX, XXXXX and XXXXX.

5. Petitioner concedes that the XXXXX and XXXXX filings and taxes were untimely as a result of its own doing; however, Petitioner contests the XXXXX penalty and interest assessment.

6. According to Tax Commission records, Petitioner failed to file its withholding return and to pay taxes in the amount of $$$$$ for XXXXX on time. The filing and payment were not received until XXXXX. Petitioner was assessed a ten percent penalty for late filing and a ten percent penalty for late payment plus interest for a total of $$$$$.

7. Petitioner asserts that it did mail the XXXXX return and payment on XXXXX. In support thereof, Petitioner has produced substantial documentation:

a) A copy of Petitioner's check register for the month of XXXXX shows that Petitioner did make out four checks in sequential order dated XXXXX to the Utah State Tax Commission. One of the four checks was check number XXXXX in the amount of $$$$$.

b) Copies of the backs of three of the four checks show that these checks were received by the Tax Commission and cashed within two weeks. Check number XXXXX was not one of them.

c) According to Petitioner's check register, Petitioner had $$$$$ in the bank when it cut check number XXXXX.

d) At the end of XXXXX, Petitioner's bank reconciliation records revealed that check number XXXXX had not yet cleared the bank. Petitioner contacted the Tax Commission to find out if there was a problem. Petitioner was told to wait a little longer and see if the check was still outstanding in the coming weeks.

e) By the end of XXXXX, Petitioner's monthly bank reconciliation records again showed that the check was still outstanding.

f) In a letter dated XXXXX, the Tax Commission informed Petitioner that it had not yet received the XXXXX return or payment.

g) Petitioner put a stop payment on the missing check and issued check number XXXXX on XXXXX as a replacement. Petitioner submitted a copy of its copy of check number XXXXX dated XXXXX.

h) The missing check has not yet been located.

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 foregoing, the Tax Commission finds that sufficient cause has been shown which would justify a waiver of the penalty associated with the withholding taxes due for the month of XXXXX. Interest is not waived. It is so ordered.

DATED this 19th day of December, 1991.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

R. H. Hansen Roger O. Tew

Chairman Commissioner

Joe B. Pacheco S. Blaine Willes

Commissioner Commissioner