97-0005

INCOME

Signed 3/24/97

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

PETITIONER, )

:

Petitioner, ) INFORMAL DECISION

:

v. )

:

COLLECTION DIVISION OF THE ) Appeal No. 97-0005

UTAH STATE TAX COMMISSION, :

) Account No. #####

:

Respondent. ) Tax Type: Income 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 March 4, 1997. Gail S. Reich, Administrative Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner was PETITIONERS REP.. Present and representing Respondent was Vickie Christoffersen.

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

FINDINGS

This case involves the income tax year 1994. A $$$$$ underpayment penalty was imposed with $$$$$ of interest having accrued. The problem occurred by Petitioner=s inadvertent mailing of the state tax check to the IRS. The IRS accidentally cashed the check but did end up refunding the money plus interest to the Petitioner. The Division has recommended waiver of the penalty based on first time error but has asserted no grounds exist to waive the interest since this did not result from Tax Commission error. Indeed, the Petitioner did receive interest back on the money when it was refunded from the IRS. The additional fact remains that the state was deprived of the funds from the proper due date until the actual date of remittance.

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

It is hereby determined that sufficient cause does exist to waive the penalty but not the interest associated with the 1994

income tax year. 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.)

^^