BEFORE THE UTAH STATE TAX COMMISSION
In Re: )
: INFORMAL DECISION
: Appeal No. 93-1603
: Account No. XXXXX
STATEMENT OF CASE
This matter came before the Utah State Tax Commission pursuant to the Administrative Procedures Act and the rules of the Utah State Tax Commission for informal proceedings. As provided for by Utah Code Ann. '63-46b-5, this decision is based upon information contained in the Tax Commission's file.
Petitioner filed and paid his XXXXX individual income tax return on time on XXXXX.
Then, in XXXXX, the Tax Commission learned from the Internal Revenue Service that Petitioner had additional income. The Commission assessed Petitioner an additional $$$$$ in taxes plus interest.
The Commission sent Petitioner an audit assessment letter on XXXXX. Petitioner paid the tax amount of $$$$$ on XXXXX.
A $$$$$ penalty was later added when Petitioner failed to pay the interest amount also.
Petitioner explained that the additional income arose after the I.R.S. had informed him that monies in two of Petitioner's IRA accounts were not deductible. Petitioner had initially put the money into the IRA accounts on the advice of his accountant.
Petitioner contends that he should not be liable for the interest and penalty amounts in that he honestly believed that the IRA accounts were deductible. Further, he adds that he paid the additional tax amount within the prescribed time period.
DECISION AND ORDER
The Tax Commission admonishes Petitioner that whenever his federal return is amended either by himself or the I.R.S., he has 90 days to amend his state return. (Utah Code Ann. '59-10-536(5)(a).) Failure to do so is grounds for a penalty assessment. (Utah Code Ann. '59-10-539).
In this case, Petitioner did not notify the Tax Commission of a change in his XXXXX federal return within 90 days. A penalty was not assessed although one easily could have been.
Based upon the foregoing, the Tax Commission finds sufficient cause exists to waive the $$$$$ penalty assessed on the XXXXX individual income tax year in that Petitioner paid the tax amount owing within thirty (30) days of the audit assessment letter. Interest, however, is not waived. The Collections Division is directed to recompute the interest amount owing to XXXXX. It is so ordered.
DATED this 2nd day of December, 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 the final order to file in District Court a petition for judicial review. Utah State Tax Commission Administrative Rule R861-5A-1(p) and Utah Code Ann. '63-46b-14(3)(a).