96-0372

Income Tax

Signed 7/11/96

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

XXXXX,

Petitioner, : ORDER

:

v. : Appeal No. 96-0372

:

AUDITING DIVISION OF THE : Account No. XXXXX

UTAH STATE TAX COMMISSION, :

:

Respondent. : Tax Type: Income Tax

_____________________________________

STATEMENT OF CASE

This matter came before the Utah State Tax Commission for a Status Conference and said conference was therein converted to an Initial Hearing pursuant to the stipulation of both parties, to be conducted pursuant to the provisions of Utah Code Ann. §59-1-502.5, on XXXXX. G. Blaine Davis, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner was XXXXX. Present and representing Respondent were XXXXX from the Auditing Division.

Respondent proposed an additional assessment against Petitioner based upon information received from the Internal Revenue Service regarding an audit made of Petitioner's return by the Internal Revenue Service, and certain changes made to his return as a result of said audit. Thereafter, Petitioner failed to file an amended Utah Income Tax Return, and when the information was received from the Internal Revenue Service, an assessment was made, which included penalties and interest. Petitioner has acknowledged that the changes to the tax were appropriate based upon his inability to provide receipts to the Internal Revenue Service, although he maintains that the deduction which he took for furniture and other items donated to charity was a valid deduction. Petitioner has paid the additional tax and has requested that the Commission waive penalty and interest upon the assessment. The penalty is $$$$$, and the interest is $$$$$.

As a basis for his request for waiver of penalty and interest, Petitioner alleges that there was no intent to defraud the state from any revenues, and he also alleges that the reason he did not file an amended return was because the revenue agent at the Internal Revenue Service told him that he would receive a bill from the Utah State Tax Commission so that he needed to wait until the bill came and pay the amount of tax on the bill.

The year at issue was the first year that Petitioner had been required to file a Utah return, because he had recently moved to Utah following his marriage to his wife who was a Utah resident, and he was not familiar with Utah income tax procedures.

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 penalty, but sufficient cause has not been shown to waive the interest assessed for the time periods.

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 11 day of July, 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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