93-0340 AND 93-0341 SALES AND WITHHOLDING
BEFORE THE UTAH STATE TAX COMMISSION
In Re: )
: FINDINGS OF FACT,
XXXXX, ) CONCLUSIONS OF LAW,
: AND FINAL DECISION
: Appeal Nos. 93-0340
) and 93-0341
: Account Nos. XXXXX
) and XXXXX
STATEMENT OF CASE
This matter came before the Utah State Tax Commission for a formal hearing on XXXXX, 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 Petitioner's business, and XXXXX, an accountant.
Based upon the evidence and testimony presented at the hearing, the Tax Commission hereby makes its:
FINDINGS OF FACT
1. The taxes in question are sales and use tax and withholding tax.
2. The quarters in question for the sales and use tax are the third quarter XXXXX and the second, third and fourth quarters of XXXXX. The quarters in question for the withholding tax are the second and third quarters of XXXXX.
3. Petitioner filed and paid its third quarter XXXXX sales and use tax ($$$$) five days late. A ten percent late penalty, $20 in legal fees, interest and a second late charge were assessed. Petitioner filed and paid its second quarter XXXXX sales and use tax ($$$$) five months late, its third quarter XXXXX sales and use tax ($$$$) a year late and its fourth quarter XXXXX sales and use tax ($$$$) seven months late. The Tax Commission assessed Petitioner two ten percent late penalties on each of these last three quarters, interest and legal fees.
4. Petitioner filed and paid its second quarter XXXXX withholding tax ($$$$) and its third quarter XXXXX withholding tax ($$$$) nearly a year late. The Tax Commission assessed Petitioner two ten percent late penalties on each of these two quarters plus interest.
5. Petitioner is requesting a waiver of the penalty amounts assessed on all quarters.
6. XXXXX, a partner with XXXXX, testified that Petitioner has been involved in a continuing legal battle with XXXXX City, where Petitioner is located, over use permits. The lawsuits between the two have been ongoing since XXXXX and the legal costs (over ($$$$)) have taken a financial toll on Petitioner.
7. Apparently, XXXXX City alleges Petitioner is a nuisance to the area and has been successful, at times, in keeping Petitioner from using city roads to access its XXXXX and XXXXX XXXXX.
8. XXXXX stated that it has been difficult for Petitioner with its cashflow problems and XXXXX XXXXX's tactics to carry on business. He testified that Petitioner has won the legal battles with the city to date.
9. Petitioner's accountant, XXXXX, stated that he advised Petitioner to at least file its returns even though it could not pay. XXXXX responded that the legal hassles involved his attention to the point where he was not sure how filings were being handled.
10. XXXXX also added that he understood from the Tax Commission employee who worked with him to resolve Petitioner's account that a waiver of all penalties would be recommended on its behalf once the account was paid up.
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 waiver of the single ten percent penalty assessed on the sales and use tax due on the third quarter XXXXX as this payment and return were received only five days late. Further, the Commission also reduces the remaining double ten percent penalties assessed on all remaining quarters (both sales and use tax and withholding tax) to single ten percent penalties. Interest and legal fees are not waived. It is so ordered.
DATED this 22nd day of September, 1993.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val Oveson Roger O. Tew
Joe B. Pacheco Alice Shearer