Signed 9/10/93






In Re:                            )

                                  :    FINDINGS OF FACT,

XXXXX,                            )    CONCLUSIONS OF LAW,

dba XXXXX,                        :    AND FINAL DECISION


                                  :    Appeal No. 93-0598

                                  )    Account No. XXXXX





                             STATEMENT OF CASE

          This matter came before the Utah State Tax Commission for a formal hearing on XXXXX.  Paul F. Iwasaki, Presiding Officer, heard the matter for and on behalf of the Commission.  Present and representing the Petitioner was 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 withholding tax.

          2.  The periods in question are the second and third quarters of XXXXX.

          3.  The Petitioner filed its second quarter XXXXX withholding tax return on XXXXX and paid that return on XXXXX.  The tax due for that period was $$$$$.

          4.  The Petitioner filed its third quarter XXXXX withholding tax return on XXXXX and paid that return on XXXXX.  The tax due for that period was $$$$$.

          5.  As a result of the failure to timely file and pay the returns in question, penalties in the amounts of $$$$$ and $$$$$ respectively were imposed as well as interest applied at the statutorily prescribed rate.

          6.  The Petitioner's representative testified that the delinquencies were caused by declining business which began in XXXXX.  Because of the decline in business, the Petitioner was unable to meet his financial obligations and was unable to pay the taxes due.

          7.  By mid XXXXX, the Petitioner stopped doing business, but rather than filing bankruptcy, the Petitioner has continued to pay its financial obligations to each of its creditors.

                            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 penalty associated with the second and third quarters XXXXX withholding tax returns to ten percent for each of the periods in question.  The interest imposed for those periods, however, is not waived and shall continue to accrue at the statutorily prescribed rate and adjusted in accordance with this decision.  It is so ordered.

          DATED this 10th day of September, 1993.



W. Val Oveson                              Roger O. Tew

Chairman                                   Commissioner


Joe B. Pacheco                             Alice Shearer

Commissioner                               Commissioner


NOTICE:  You have twenty (20) days after the date of the final order to file a request for reconsideration or thirty (30) days after the date of final order to file in Supreme Court a petition for judicial review.  Utah Code Ann. ''63-46b-13(1), 63-46b-14(2)(a).