BEFORE THE UTAH STATE TAX
COMMISSION
_________________________________
In Re: )
:
XXXXX, ) FINDINGS OF FACT,
: CONCLUSIONS
OF LAW,
) AND FINAL
DECISION
:
) Appeal No.
92-1503
: 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
XXXXX, Petitioner's accountant and XXXXX, vice president.
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 period in question is January XXXXX
through June XXXXX.
3. During the time in question, Petitioner
employed XXXXX, a brother of one of the owners, as general manager for the
corporation's business.
4. Unbeknownst to the owners, XXXXX had a drug
addiction to painkillers that physicians had prescribed for him for an earlier
back injury.
5. XXXXX's addiction escalated during the time
in question.
6. The owners became aware of delinquent tax
notices and questioned XXXXX about the situation.
7. XXXXX explained that the sales and use taxes
were remitted to the state and that the state must have misapplied the
payments. (These returns had been prepared by an accountant for XXXXX to send
to the state with payments.)
8. He told the owners he was looking into the
confusion.
9. Finally, XXXXX was arrested on drug
charges. He later completed a 30-day
in-patient drug rehabilitation program.
10. Petitioner was assessed 20% late filing and
late payment penalties on all quarters involved as a result of XXXXX's failure
to handle the sales and use taxes property.
11. Petitioner has since paid approximately
$$$$$ in back taxes.
12. The Internal Revenue Service waived the
penalties and interest for the same 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
Based
upon the foregoing, the Tax Commission finds that sufficient cause has been
shown which would justify a reduction of the penalties assessed on sales and
use taxes due for the period in question to 10%. This reduced penalty remains because the owners should have more
closely supervised the actions of their general manager when they learned of
the delinquent tax notices. This tax
delinquency existed for two and a half years.
Interest is not waived. It is so
ordered.
DATED
this 2nd day of December, 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