94-1364
Income Tax
Signed 3/22/95
BEFORE THE UTAH STATE TAX
COMMISSION
____________________________________
XXXXX, )
:
Petitioner, : ORDER
:
v. : Appeal No. 94-1364
:
COLLECTION
DIVISION OF THE : Account No. XXXXX
UTAH STATE TAX COMMISSION, :
:
Respondent. : Tax Type: Income Tax
_____________________________________
STATEMENT OF CASE
This
matter came before the Utah State Tax Commission for a Settlement Conference
pursuant to the provisions of Utah Code Ann. §59-1-502.5, on XXXXX. Jane Phan, Administrative Law Judge, heard
the matter for and on behalf of the Commission. Present and representing Petitioner were XXXXX. Present and representing Respondent was
XXXXX.
An
assessment was made against Petitioner for penalties associated with his income taxes for the tax years XXXXX and
interest in the amount of approximately $$$$$ for the XXXXX tax year,
approximately $$$$$ for the XXXXX tax year and approximately $$$$$ for the
XXXXX tax year. Petitioner had requested
a waiver of the penalties and interest from the Collection Division Waiver Unit
which did waive the penalties for the XXXXX in question. Petitioner now appeals
the denial of Petitioner's request for waiver of the interest.
At the conference Petitioner stated that he
was in the XXXXX during the years in question and had for the purpose of
determining his federal tax liability claimed the expenses associated with this
business. Subsequent to filing the tax
forms for the years in question the Internal Revenue Service (IRS) determined
that the Petitioner was not entitled to claim these business expenses. Petitioner fought with the IRS for XXXXX
over this issue because he felt he was right.
This fight was at great expense to Petitioner and took a XXXXX. In the end Petitioner paid the amount
claimed by the IRS and as this affected his state taxes immediately paid the
increase in state taxes for the years in question.
Petitioner
stated that he still felt he was right and should have been able to deduct the
expenses regardless of the IRS's determination. He stated that he could not fight anymore so he paid the
additional taxes to the IRS and the Utah Tax Commission. Further, Petitioner stated that although the
Collection Division Waiver Unit has waived the penalties they were only about
$$$$$ (Although Respondent said they were $$$$$) and the interest was nearly
$$$$$.
Respondent
stated that Petitioner had not shown sufficient reasonable cause to waive the
interest.
In
considering Petitioner's request for waiver or reduction of the interest the
Tax Commission applies stringent reasonable cause standards because Petitioner
continued to enjoy the benefit of the use of the funds and the State of Utah
was denied the benefit of the use of the funds from the time the underlying
taxes were due until they were actually paid by Petitioner.
DECISION AND ORDER
Based
upon the information presented at the conference, and the records of the Tax
Commission, the Commission finds sufficient cause has not been shown to waive
or reduce the interest assessed for the Petitioner's individual income taxes
for the XXXXX XXXXX tax periods.
This
decision does not limit a party's right to a formal hearing. However, this Decision and Order will become
the Final Decision and Order of the Commission unless any party to this case
files a written request within thirty (30) days of the date of this decision to
proceed to a Formal Hearing. Such a
request shall be mailed to the address listed below and must include the
Petitioner's name, address, and appeal number:
Utah State Tax Commission
Appeals Division
210 North 1950 West
Salt Lake City, Utah 84134
Failure
to request a Formal Hearing will preclude any further administrative action or
appeal rights in this matter.
DATED
this 22nd day of March, 1995.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val
Oveson Roger
O. Tew
Chairman Commissioner
Joe B.
Pacheco Alice
Shearer
Commissioner Commissioner