96-2167

Withholding

Signed 9/3/97

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

COMPANY B :

:

Petitioner, : DECISION

:

v. :

:

COLLECTION DIVISION OF THE : Appeal No. 96-2167

UTAH STATE TAX COMMISSION, :

: Account No. #####

:

Respondent. : Tax Type: Withholding

_____________________________________

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 adjudicative proceeding. A hearing was held on August 28, 1997. Gail S. Reich, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner by telephone was PETITIONERS REP.. Present and representing Respondent was Laurie Allred of the Collection Division.

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

FINDINGS

This appeal involves withholding tax for January, February, April and May of 1996. For January a late filing penalty was imposed of $$$$$ and a late payment penalty of $$$$$; for February a late filing penalty was imposed of $$$$$ and a late payment penalty of $$$$$; for April a late filing penalty was imposed of $$$$$ and a late payment penalty of $$$$$; for May a late filing penalty was imposed of $$$$$ and a late payment penalty of $$$$$.

Petitioner indicated the problem resulted from a system error which designated the Petitioner as a quarterly filer instead of properly as a monthly filer. The confusion over whether Petitioner was a monthly or quarterly filer continued for Petitioner through May. However, the Respondents position is that the confusion should have been corrected when notice from the Tax Commission was issued in April to put Petitioner on proper notice of the need to file monthly. The Respondent has recommended that January and February may be waived based on the confusion, but that subsequent to the letter from the Tax Commission, no justification exists for waiver of the penalties for April and May.

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 a thorough review of the entire matter and consideration of all the issues raised by both parties it has been determined that sufficient cause does exist to waive the penalty imposed for January and February of 1996, but not for April and May of 1996. It is so ordered.

DATED this 3 day of SEPTEMBER, 1997.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

_____________________________

Gail S. Reich

Administrative Law Judge

The agency has reviewed this case and the undersigned concur in this decision.

DATED this 3 day of SEPTEMBER, 1997.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

W. Val Oveson Richard B. McKeown

Chairman Commissioner

Joe B. Pacheco Pam Hendrickson

Commissioner Commissioner

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