94-1591

Income Tax

Signed 3/9/95

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

XXXXX, )

Petitioner, : ORDER

v. :

COLLECTION DIVISION OF THE : Appeal No. 94-1591

UTAH STATE TAX COMMISSION, :

: Account No. XXXXX

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. XXXXX, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner was XXXXX. Present and representing Respondent was XXXXX.

Penalties of $$$$$ and interest of $$$$$ were assessed against Petitioner for Petitioner's late filing or late payment of income tax for the tax years XXXXX, XXXXX and XXXXX Petitioner had requested a waiver of the penalties and interest from the Collection Division Waiver Unit which was denied. Petitioner now appeals this denial.

At the hearing conference Petitioner stated that he had hired a tax preparer to process his taxes for the tax years in question. According to Petitioner, the tax preparer, apparently suffering from some XXXXX, disappeared in XXXXX The tax preparer's XXXXX without Petitioner having knowledge of the location or access to them.

Petitioner stated that an extension had been filed for the XXXXX tax year and Petitioner did ask the tax preparer several times prior to his disappearance to finish this return, but the tax preparer failed to comply.

Respondent stated that the Petitioner's failure to file his XXXXX return was understandable because of the disappearance of the tax preparer and the unavailability of Petitioner's records. Respondent recommended waiving the $$$$$ penalty for XXXXX Further, Respondent agreed that Petitioner may have relied on the tax preparer to file the XXXXX return, although the tax preparer did not disappear until after the return should have been filed.

For the tax year XXXXX, Petitioner was aware that the return had not been filed during the extension period.

In considering Petitioner's request for waiver or reduction of the interest the Tax Commission applies more 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 been shown to waive the penalties assessed for the XXXXX and XXXXX tax years. Sufficient cause has not been shown to waive the penalty for the XXXXX tax year or the interest for any of the years in question. It is so ordered.

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 9 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

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