BEFORE THE UTAH STATE TAX
COMMISSION
_______________________________
In Re: )
:
XXXXX, ) FINDINGS OF FACT,
: CONCLUSIONS
OF LAW,
) AND FINAL
DECISION
:
) Appeal No.
92-2375
: 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 was
XXXXX, a partner in 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 corporate franchise
tax.
2. The periods in question are the years
XXXXX-XXXXX.
3. Petitioner filed the corporate franchise tax
returns in question in XXXXX along with their respective payments. The Tax Commission assessed Petitioner two
$$$$$ late penalties, one for late filing and the other for late payment plus
interest, on each of the years. (For
the year XXXXX, Petitioner owed only the minimum tax of $$$$$ as it went out of
business in XXXXX.)
4. Prior to XXXXX, XXXXX was running her own
pre-school called XXXXX, a sole proprietorship. Then, in XXXXX, she opened a second pre-school with her son and
his soon-to-be wife, XXXXX, forming a pre-school and day care center called
XXXXX, a business partnership.
5. Ms. XXXXX's son and XXXXX married in
XXXXX. Ms. XXXXX left the new day care center
to XXXXX's management while she continued running XXXXX.
6. XXXXX, however, did not handle all of the
business obligations as she should have.
In XXXXX, the bank notified XXXXX that liens had been filed against her
account for failure to pay taxes.
7. This was the first time XXXXX became aware
of XXXXX's mismanagement.
8. Throughout this time, XXXXX had been working
at the center and Ms. XXXXX had no reason to suspect that XXXXX had not been
paying bills, filing tax returns, etc.
XXXXX had managed a pre-school before.
9. Also during this time in question, XXXXX and
Ms. XXXXX's son were experiencing difficult marital problems which eventually
led to their divorce. The effects of
the failing marriage took an emotional toll on Ms. XXXXX and her husband as a
divorce had never occurred in their family before.
10. In XXXXX, XXXXX took over the books of XXXXX
and tried to straighten out the tax problems with the help of XXXXX. She learned that XXXXX had left the
pre-school with thousands of dollars in debt.
11. XXXXX went out of business in XXXXX.
12. Mrs. XXXXX is requesting a waiver of the
penalty and interest amounts. She
provided documentation from the Internal Revenue Service showing that it had
waived penalties for tax years XXXXX and XXXXX on XXXXX's XXXXX. Ms. XXXXX stated that she had given them the
same information she provided at the Tax Commission hearing.
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
corporate franchise tax due on the years XXXXX-XXXXX to $$$$$ for each
year. The entire penalty amounts are
not waived as business partners are liable for one another's actions. The interest is not waived. It is so ordered.
DATED
this 10TH day of SEPTEMBER, 1993.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val
Oveson Roger
O. Tew
Chairman Commissioner
Joe B.
Pacheco Alice
Shearer
Commissioner Commissioner