95-1440

Income

Signed 3/11/96

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

XXXXX,

Petitioners, ) INFORMAL DECISION

:

v. )

:

COLLECTION DIVISION OF THE ) Appeal No. 95-1440

UTAH STATE TAX COMMISSION, :

) Account No. XXXXX

: and XXXXX

Respondent. ) Tax Type: Income

_____________________________________

STATEMENT OF CASE

This matter came before the Utah State Tax Commission pursuant to the Administrative Procedures Act and the rules of the Utah State Tax Commission for informal proceedings. An Informal Hearing was held on XXXXX. Gail Reich, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioners by telephone was XXXXX. Present and representing Respondent were XXXXX and XXXXX.

Based upon the evidence in the file and presented at the Informal Hearing, the Commission makes its:

FINDINGS

This appeal involves a request for waiver of penalty and interest of the XXXXX income tax year. An adjustment was made by the IRS on the federal return. Under state law, Petitioner is required to file an amended return within 90 days of the adjustment by the IRS. The penalty imposed resulted from Petitioner's failure to comply with this requirement. The interest has accrued from the due date of the funds to the date of actual receipt by the Tax Commission, since the Commission was deprived of the benefit of the funds during that period.

Petitioner asserts that he was unaware of the requirement. Respondent indicated that Petitioner's lack of knowledge of the requirement to file with the state within 90 days of an adjustment by the IRS does not constitute grounds for waiver of the penalty. Additionally, since the Petitioner had benefit of the funds until final payment, rather than the Commission, Respondent submitted that there were no grounds to constitute waiver of the interest.

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

The Commission has reviewed the record and has considered the position of both the Petitioner and the Respondent. Based upon the circumstances, the Tax Commission finds sufficient cause does not exist to waive either the penalty or the interest associated with the XXXXX income tax. It is so ordered.

DATED this 11 day of March, 1996.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

W. Val Oveson Roger O. Tew

Chairman Commissioner

Joe B. Pacheco Alice Shearer

Commissioner Commissioner

NOTICE: You have twenty (20) days after the date of a final order to file a Request for Reconsideration with the Commission. If you do not file a Request for Reconsideration with the Commission, you have thirty (30) days after the date of a final order to file a Petition for Judicial Review by trial de novo in district court. (Utah Administrative Rule R861-1A-5(P) and Utah Code Ann. '63-46b-13 et. seq.)

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