96-2018

Franchise Tax

Signed 10/7/96

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

XXXXX, )

:

Petitioner : INFORMAL DECISION

:

v. :

:

COLLECTION DIVISION OF THE : Appeal No. 96-2018

UTAH STATE TAX COMMISSION, :

: Account No. XXXXX

:

Respondent. : Tax Type: Franchise Tax

_____________________________________

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 MMDDYY. Jane Phan, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner was XXXXX, former XXXXX and former XXXXX of XXXXX. Present and representing Respondent was XXXXX.

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

FINDINGS

Petitioner is appealing the assessment of an underpayment penalty in the amount of $$$$$ relating to corporate franchise tax for the tax year July 19YY through June 19YY.

Petitioner's representative explained that Petitioner sold its hardware store in December of 19YY. The XXXXX store was the corporation's only operation. When the store was sold the principals of the corporation discussed closing the corporation but did not do it until after they received notice that the annual fee was due. Petitioner's representative explained that she knew a return would be due for the tax year in question but because her father was out of town, and he was the only one with sufficient knowledge to prepare the return, she filed for an extension. Petitioner thought there would be no tax due so she did not make the proper prepayment. She requested that the penalty be waived based on the account history of Petitioner and the fact that she did attempt to comply even thought the corporation no longer was doing any business.

Respondent's representative explained that the penalty imposed was an underpayment penalty. It had been assessed because Petitioner had failed to make the required prepayment. The amount of the prepayment should have been %%%%% of the prior years tax or at least %%%%% of the current years tax. She stated that there had been one other period where Petitioner had paid the tax late and stated that she saw no reasonable cause for waiver of the penalty or 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

After reviewing the information presented by the parties the Tax Commission finds sufficient cause does not exist to waive the penalty or interest associated with the Petitioner's corporate franchise tax for the year ending June 19YY. It is so ordered.

DATED this 7th day of October, 1996.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

W. Val Oveson Richard B. McKeown

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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