95-0881
____________________________________
XXXXX, )
:
Petitioner, : ORDER
:
v. : Appeal No. 95-0881
:
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 an Initial Hearing
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 by telephone conference call
was XXXXX, Petitioner's Personal Representative. Present and representing Respondent was XXXXX.
Penalties
in the amount of $$$$$ and approximately $$$$$ of interest were assessed
against Petitioner's estate relating to income tax for the XXXXX tax year. The Collection Division Waiver Unit denied
waiver of the penalties and interest. Petitioner's
representative now appeals only the penalty.
The underlying Utah individual income tax owed for XXXXX was $$$$$, of
which $$$$$ had been paid by Petitioner's withholding.
At
the hearing the representative for Petitioner explained that Petitioner died on
XXXXX. Petitioner was a doctor and had
earned his income as an employee and from his corporate and partnership
interests. Since Petitioner's
representative lived and worked in XXXXX and Petitioner's office, records and
accountant were in Utah there was a significant amount of delay in obtaining
necessary information. To make it more
difficult Petitioner's office staff had to seek other employment after
Petitioner's death so there was no one readily available to compile necessary
information for the state and federal individual income and estate tax filings
required. Although by XXXXX, W-2's were
complete for income Petitioner earned in XXXXX as an employee, other income
from Petitioner's corporation and partnerships had not yet been determined.
In
response to Respondent's statement that the penalty assessed was an extension
penalty because Petitioner did not make a prepayment for the extension,
Petitioner's representative stated that the $$$$$ prepayment rule was difficult
to follow in this case. Petitioner's
income for XXXXX was not comparable because Petitioner worked only during the
first thee months of XXXXX. Further,
Petitioner's representative stated that at the time the return was due they did
not have information concerning income earned by Petitioner's partnerships and
a professional corporation which Petitioner's representative had not become
aware of until sometime after Petitioner's death.
Respondent
stated that the death of Petitioner and the unavailability of records were
sufficient reasonable cause for waiver of the penalties.
APPLICABLE LAW
The
Tax Commission is granted the authority to waive, reduce, or compromise
penalties and interest upon a showing of reasonable cause. (Utah Code Ann. §59-1-401(10).)
DECISION AND ORDER
Based
upon the information presented at the hearing, and the records of the Tax
Commission, the Commission finds sufficient cause has been shown to waive the
penalties of $$$$$ for Petitioner's XXXXX income tax.
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 August, 1995.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val
Oveson Roger
O. Tew
Chairman Commissioner
Joe B.
Pacheco Alice
Shearer
Commissioner Commissioner
^^