96-2203

INCOME

Signed 3/24/97

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

PETITIONER, )

:

Petitioner, ) INFORMAL DECISION

:

v. )

:

AUDITING DIVISION OF THE ) Appeal No. 96-2203

UTAH STATE TAX COMMISSION, :

) Account No. #####

: and #####

Respondent. ) Audit Period: 1991

_____________________________________

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 January 16, 1997. Gail S. Reich, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner was PETITIONERS REP., CPA. Present and representing Respondent were Dan Engh and Frank Hales of the Auditing Division.

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

FINDINGS

This appeal involves the 1991 income tax year. It involves a penalty of $$$$$ that was imposed as a result of failing to comply with the statutory requirement to file an Amended Return with the State within 90 days of an adjustment at the federal level. Subsequently, interest has accrued in the amount of approximately $$$$$. Subsequent to receiving information from the federal government the state made the appropriate adjustments and gave the appropriate credit as a result of the changes for the 1991 income tax year. This constitutes first time error for the Petitioner.

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 Tax Commission has reviewed the entire matter and the positions of both the Petitioner and the Respondent. It is hereby found that sufficient evidence does exist to constitute reasonable cause for waiver of the penalty imposed for the 1991 income tax year. Since Petitioner and not Respondent had the benefit of the funds until ultimate payment, no grounds exist to justify waiver of the interest. It is so ordered.

DATED this 24 day of MARCH, 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 24 day of MARCH, 1997.

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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