96-0111

Income

Signed 4/1/96

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

XXXXX,

Petitioners, ) ORDER

:

v. ) Appeal No. 96-0111

:

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 Petitioners was XXXXX. Present and representing Respondent was XXXXX.

Petitioners are appealing the assessment of penalties and interest relating to their Utah individual income tax for the year XXXXX. The penalties assessed were $$$$$ and the interest approximately $$$$$.

At the hearing Petitioner explained that a fire had destroyed Petitioners' business in XXXXX. Business records were damaged in the fire. He explained that the business was their only source of income. They had been underinsured and the insurance company took a long time in processing the claim which inhibited their ability to get back to work. Petitioner provided a copy of the Fire Incident Report from the fire department.

After reviewing the report from the fire department which confirmed Petitioner's position, Respondent recommend waiving the penalties. Respondent did not recommend waiver of the interest, pointing out that interest is generally waived only in the event the late filing or late payment resulted from an error on the part of Tax Commission employees.

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 $$$$$ assessed relating to Petitioners income tax for XXXXX. Sufficient cause was not shown for waiver of the approximately $$$$$ in 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 1 day of April, 1996.

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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