BEFORE THE UTAH STATE TAX COMMISSION
In Re: )
XXXXX, ) FINDINGS OF FACT,
: CONCLUSIONS OF LAW,
) AND FINAL DECISION
) Appeal No. 93-0762
: 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 certified public accountant, and XXXXX, a director at 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 sales and use tax.
2. The periods in question are the third and fourth quarters of XXXXX.
3. Petitioner filed the above returns in XXXXX. One of the two payment checks Petitioner submitted with the returns, however, was returned for insufficient funds. Petitioner paid the deficient amount on XXXXX.
4. As a result of the late filings and late payments, the Tax Commission assessed Petitioner two ten-percent penalties on each quarter. Interest was also charged.
5. Petitioner is requesting a waiver of the penalty and interest assessments in this case.
6. Petitioner hired a new accountant in the fall of XXXXX named XXXXX. Based upon XXXXX's representations and references, Petitioner thought XXXXX was well-qualified for the job.
7. In mid-XXXXX when Petitioner tried to buy real estate, Petitioner discovered that it was delinquent in sales and use tax filings and payments with the state for the quarters in question.
8. Despite assurances from XXXXX that the taxes were being handled, XXXXX was hiding tax late notices from Petitioner.
9. XXXXX, a director at XXXXX, thought that XXXXX had been dutifully performing his job responsibilities when it turned out to not be the case.
10. XXXXX testified that Petitioner always had funds available to pay sales and use tax liabilities. Petitioner submitted its XXXXX bank statement showing that it had sufficient funds to cover the taxes that were due for the fourth quarter of XXXXX.
11. When XXXXX learned about the missed filings and payments, he went to the Commission and filed and paid them. He stated that the second check bounced because XXXXX had failed to transfer funds from one account to the other.
12. Petitioner later fired XXXXX and hired a new accountant, XXXXX, in XXXXX.
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
It is well-established that employers are responsible for the actions of their employees. Under the circumstances of this case, the Commission is willing to reduce the penalty some degree.
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 sales and use tax due on the
third and fourth quarters of XXXXX to a single ten percent penalty on each quarter. Interest is not waived. It is so ordered.
DATED this 26th day of August, 1993.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val Oveson Roger O. Tew
Joe B. Pacheco Alice Shearer
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).