94-1610

Income

Signed 2/27/95

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

XXXXX, )

:

Petitioner, : ORDER

:

v. : Appeal No. 94-1610

:

COLLECTION DIVISION OF THE : Account No. XXXXX

UTAH STATE TAX COMMISSION, :

:

Respondent. : Tax Type: Income

_____________________________________

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 and D. XXXXX. Present and representing Respondent was XXXXX.

Petitioner appealed the penalty of $$$$$ and interest in the amount of $$$$$ assessed against him for his late payment of income taxes for the tax year XXXXX. The Collection Division Waiver Unit had denied Petitioner's request for waiver of this penalty and interest.

At the hearing XXXXX stated that he had prepared both the state and federal income tax forms which he gave to Petitioner with filing instructions on XXXXX. Petitioner stated that he signed the forms, made out the check for the state but he inadvertently included the check, in the amount of $$$$$, in the mailing to the IRS. Petitioner mailed both returns timely and thought correct payment had been made. Two months later the IRS sent Petitioner a refund of $$$$$. Realizing that was the exact amount owed the State of Utah, Petitioner thought to call the Tax Commission to make sure he had not made an error. When Petitioner asked about his account it was determined that the payment had not been included with the state tax return. Petitioner immediately paid the taxes owed and the interest accrued to that point.

At the conference Petitioner provided copies of his canceled check from the Internal Revenue Service, the refund check from the Internal Revenue Service and his check to the Tax Commission to correct the error.

At the conference Respondent stated that the account history and the documents provided supported Petitioner's position. Respondent recommended waiving the penalty because the Petitioner had contacted the Tax Commission prior to the Tax Commission's contacting him and had immediately corrected the error as soon as it was discovered.

The State of Utah was denied of the use of the funds for the underlying taxes from the time they should have been paid until the time the Petitioner corrected his error.

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 penalty of $$$$$ assessed for the XXXXX tax year relating to the income tax. Sufficient cause has not been shown to waive the interest on the underlying tax from the date it was due until the date it was received by the Tax Commission.

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 27 day of February, 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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