92-1827 - Income

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

In Re: )

:

XXXXX, ) FINDINGS OF FACT,

: CONCLUSIONS OF LAW,

) AND FINAL DECISION

:

) Appeal No. 92-1827

: 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. Petitioner represented himself.

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 individual income tax.

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

(The year XXXXX is not included in this appeal as Petitioner had not yet paid the tax).

3. Petitioner failed to file his individual income tax returns for the years in question due to a lack of ability to pay.

4. Finally, in XXXXX and XXXXX, Petitioner filed all of the returns in question and made payment of all taxes in full in XXXXX. Remaining are the substantial penalty and interest assessments on all of the years in question.

5. Petitioner explained that his problems began when his employer did not include any deductions from his paychecks beginning back in XXXXX. From then on, he just didn't have the money to pay his taxes when they were due so he didn't file any returns.

6. In XXXXX, Petitioner contacted the Tax Commission to resolve his income tax account, thinking he could enter a payment plan of some sort. Unfortunately, Petitioner lost his job soon thereafter.

7. Petitioner then turned to his 401(k) plan and withdrew a substantial amount, incurring a large penalty. He used this money to pay his state taxes ($$$$$).

8. Petitioner testified that he now owes the I.R.S. $$$$$.

9. After a period of unemployment, Petitioner now works in commission sales. His 40l(k) savings is now depleted along with his savings. He stated that he borrowed from a friend to make his mortgage payment.

10. At this time, Petitioner's wife is working part-time at minimum wage. He has four children to support and finances are tight.

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 associated with the individual income taxes due on the years XXXXX - XXXXX and XXXXX to a single ten percent penalty on each of the years. Interest is not waived. It is so ordered.

DATED this 13th day of August, 1993.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

W. Val Oveson* Roger O. Tew

Chairman Commissioner

Joe B. Pacheco Alice Shearer*

Commissioner Commissioner