94-2148

Withholding
Signed 3/28/95

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

XXXXX, )

:

Petitioner, : ORDER

:

v. : Appeal No. 94-2148

:

COLLECTION DIVISION OF THE : Account No. XXXXX

UTAH STATE TAX COMMISSION, :

:

Respondent. : Tax Type: Withholding

_____________________________________

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 was XXXXX. Present and representing Respondent was XXXXX.

Petitioner is appealing penalties of $$$$$ and interest of approximately $$$$$ which were assessed against Petitioner relating to withholding tax for the XXXXX quarter of XXXXX. The underlying amount of withholding tax owed for this period was $$$$$. Petitioner had requested a waiver of the penalties and interest from the Collection Division Waiver Unit which was denied.

At the conference Petitioner stated that it had mailed the appropriate form with the check timely for the XXXXX quarter payment. In XXXXX of XXXXX the Petitioner noticed that the check had not yet cleared its bank so Petitioner called the Tax Commission. Petitioner said it was not until XXXXX of that year that the Tax Commission responded saying it did not have the check or the return. The Petitioner immediately sent in a new check and copy of the return.

At the conference Respondent recommended waiving the penalty because it was the Petitioner who had made the initial contact concerning the fact that the check had not been processed by the Commission. Respondent stated that there was not sufficient reasonable cause to waive the interest.

In considering the Tax Commission'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 the second check was received by the Tax Commission.

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 $$$$$ relating to withholding tax for the XXXXX quarter of XXXXX. Sufficient cause has not been shown to waive the interest.

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 28 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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