BEFORE THE UTAH STATE TAX COMMISSION
XXXXX & XXXXX )
Petitioner, ) FINDINGS OF FACT,
: CONCLUSIONS OF LAW,
v. ) AND FINAL DECISION
AUDITING DIVISION OF THE ) Appeal No. 92-1296
UTAH STATE TAX COMMISSION, :
) 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. Representing the Petitioner was XXXXX. Present and representing the Respondent was XXXXX, Assistant Utah Attorney General.
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. XXXXX, a resident of XXXXX, tried to buy a car from XXXXX XXXXX in Utah in the fall of XXXXX.
3. When he was denied financing, Mr. XXXXX persuaded his parents to buy the car for him.
4. His parents purchased the car under the auspices of the XXXXX and XXXXX XXXXX Trust of which XXXXX is a trustee. This is a Utah trust.
5. The car dealership had two non-resident affidavits signed on the purchase of the car, one in the name of XXXXX and the other in the name of XXXXX. Both forms listed XXXXX's address in XXXXX. XXXXX's signature appears at the bottom of one of the forms.
6. XXXXX testified that his parents drove the new car to XXXXX two to three weeks after its purchase. He, in turn, owes his parents the money used to buy the car.
7. In XXXXX, XXXXX registered the car under the family trust name as well as his own.
8. Further, at the time of the purchase of the car in question, XXXXX owned a home in XXXXX, Utah which he rents out. He, however, lives in XXXXX where he has a business and rents a home.
9. XXXXX stated that the dealership advised him that he qualified as a non-resident for the purposes of a sales tax exemption.
10. The Auditing Division of the Tax Commission argues that sales and use tax is due on this car as the true purchaser of the car is the family trust which is located in Utah. Moreover, if XXXXX was somehow determined to be the purchaser, he owns Utah property and would be subject to the sales tax in any case.
11. Petitioner was assessed a fifteen percent penalty for intentional disregard of a law or rule plus interest.
CONCLUSIONS OF LAW
Sales of vehicles of a type required to be registered under the motor vehicle laws of the state which are made to bona fide non-residents of the state and are not thereafter registered to use in this state except as necessary to transport them to the borders of the state are exempt from sales tax. (Utah Code Ann. §59-12-104(9).)
"Person" includes any individual, firm, partnership, joint venture, association, corporation, estate, trust, business trust, receiver, syndicate, or any group or combination, acting as a unit. (Utah Admin. Code R873-22M-1(A)(1).)
Any person qualifying as a resident who operates a vehicle, or allows the operation of a vehicle in this state must register it immediately. For the purposes of vehicle registration, the term "resident" means,
...any person, except
a tourist temporarily within the state, or student, covered under the rule
R873-22M-4, who owns, leases, or rents a residence or place of business within
the state, or occupies or permits to be occupied a Utah residence or place of
business. (Utah State Tax Commission
Administrative Rule R873-22M-1(1B).)
DECISION AND ORDER
The Tax Commission agrees with the Auditing Division's determination in this case that the purchaser of car is a Utah trust and, as such, the trust was required to pay Utah sales tax on the purchase. The fifteen percent penalty, however, is reduced to ten percent. Interest is not waived. It is so ordered.
DATED this 10th day of June, 1993.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
R. H. Hansen Roger O. Tew
Joe B. Pacheco S. Blaine Willes