91-1926

Sales

Signed 4/21/92

BEFORE THE UTAH STATE TAX COMMISSION

_________________________________

In Re: ) FINDINGS OF FACT,

: CONCLUSIONS OF LAW,

XXXXX ) AND FINAL DECISION

:

) Appeal No. 91‑1926

: 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 were attorney XXXXX and general partner 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 and use tax.

2. The periods in question are the third and fourth quarters of XXXXX.

3. Petitioner filed its third quarter XXXXX sales and use tax return on XXXXX, nearly two months late. At the time of filing, Petitioner paid $$$$$ of the $$$$$ in taxes it owed. Penalty and interest were assessed.

4. Petitioner paid the balance of its third quarter XXXXX sales and use taxes on XXXXX.

5. Petitioner filed its fourth quarter XXXXX sales and use tax return on XXXXX. Petitioner included three checks to pay the $$$$$ in taxes that were due. All three checks bounced.

6. Petitioner paid its fourth quarter XXXXX sales and use taxes in full on XXXXX.

7. XXXXX, general partner for Petitioner, stated that the manager of his Boise store embezzled at least $$$$$ (and possibly more) between the end of XXXXX and the first three months of XXXXX.

8. The manager was discharged in XXXXX. XXXXX embezzlement case number XXXXX is currently pending against the former manager.

9. Petitioner had an unblemished record in paying taxes and filing returns until the period in question. There have been no problems since.

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

The embezzlement Petitioner refers to occurred months prior to the two quarters at issue. The fact of the matter is that the collection of the sales and use taxes during the two quarters in question was not affected in any way by the embezzlement.

Petitioner collected sales and use taxes on behalf of the state. These funds were never available to Petitioner for its own use. In this case, it is apparent that Petitioner used the tax money when its own funds were lacking for whatever reason. While the Tax Commission understands why this happened, it cannot validate Petitioner's actions by waiving or reducing the penalty and interest assessments.

Based upon the foregoing, the Tax Commission finds that sufficient cause has not been shown which would justify a reduction of the penalties associated with the third and fourth quarters of XXXXX to $$$$$. Interest is not waived. It is so ordered.

DATED this 21 day of April, 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

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 Supreme Court a petition for judicial review. Utah Code Ann. ''63‑46b‑13(1), 63‑46b‑14(2)(a).

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