92-1634 - Income

BEFORE THE UTAH STATE TAX COMMISSION

_________________________________

In Re: ) FINDINGS OF FACT,

: CONCLUSIONS OF LAW,

XXXXX & XXXXX, ) AND FINAL DECISION

:

) Appeal No. 92-1634

: Account No. XXXXX

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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. XXXXX represented Petitioners by telephone.

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 personal income tax.

2. The years in question are XXXXX, XXXXX, and XXXXX.

3. In April XXXXX, Petitioners filed Chapter 13 bankruptcy.

4. This bankruptcy was dismissed XXXXX.

5. Prior to the bankruptcy, Petitioners owed $$$$$ in personal income taxes for XXXXX, plus penalty and interest assessments.

6. The bankruptcy court paid $$$$$ of this balance.

7. The Tax Commission applied another $$$$$ in refund credit.

8. Currently, Petitioners still owe approximately $$$$$ for XXXXX. The interest assessment accounts for this large balance.

9. Also prior to the bankruptcy, Petitioners owed $$$$$ in personal income taxes for XXXXX, plus penalty and interest.

10. The bankruptcy court paid $$$$$ of this balance.

11. Petitioners paid $$$$$ toward the balance in XXXXX.

12. Currently, Petitioners still owe approximately $$$$$ for XXXXX. Here again, the interest assessments are significant.

13. Prior to the bankruptcy, Petitioners owed $$$$$ in personal income taxes for XXXXX, plus interest.

14. Petitioners paid $$$$$ toward the balance in XXXXX.

15. Currently, Petitioners owe approximately $$$$$ for XXXXX. The interest assessment is significant.

16. Petitioners are requesting a waiver of the penalty and interest assessments on the years in question.

17. They understood from the bankruptcy court that it had paid off the outstanding tax balances.

18. Petitioners feel that a waiver is in order as they have tried unsuccessfully to get an explanation of their account status from the Tax Commission. They state they have called and written for more information without adequate response.

19. Further, Mr. XXXXX has had periods of unemployment, making it difficult for Petitioners to make additional payments.

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 instructs the Collection Division to review and adjust Petitioners' account, if necessary to abate any interest amounts assessed during the period of XXXXX through XXXXX (period in bankruptcy).

The Tax Commission finds reasonable cause has not been shown which would justify a reduction of the penalty and remaining interest amounts (after re-calculation). The bankruptcy record Petitioners provided at the hearing shows that the bankruptcy court at one point in time showed a balance due the Commission of $$$$$ of which only $$$$$ was paid out. In any case, a bankruptcy does not release a taxpayer of liability. It is so ordered.

DATED this 7th day of January, 1993.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

R. H. Hansen Roger O. Tew

Chairman Commissioner

Joe B. Pacheco S. Blaine Willes

Commissioner Commissioner