97-0606

WITHHOLDING

Signed 9/9/97

BEFORE THE UTAH STATE TAX COMMISSION

____________________________________

COMPANY A, )

:

Petitioner, ) DECISION

:

v. )

:

AUDITING DIVISION OF THE ) Appeal No. 97-0606

UTAH STATE TAX COMMISSION, :

STATE OF UTAH, ) 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 proceedings. A hearing was held on July 15, 1997. G. Blaine Davis, Administrative Law Judge, and Pam Hendrickson, Commissioner, heard the matter for and on behalf of the Commission. Present on the telephone and representing Petitioner was PETITIONERS REP.. Present and representing Respondent were Mr. Dan Engh and Mr. Frank Hales, from the Auditing Division.

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

FINDINGS

Petitioner has its payroll checks prepared by XXXXX, and that company also prepares the payroll tax returns for the company. An audit of the records indicated that one quarter of the 1993 payroll taxes was not reported or paid to the State of Utah. Petitioner represents that the reason for missing the quarter is because the handling of the Utah account was transferred from the Washington office to the Utah office of XXXXX, so that each office thought the other office had prepared the return. As a result of the mistake, the Respondent imposed a 10% negligence penalty for not reconciling the records. Petitioner has requested a waiver of the penalty and interest. Petitioner further represents that they tried to get the matter resolved in July of 1995, and purportedly mailed a check to the Commission at that time, but it was not received by the Commission. However, the penalty was not imposed for failure to pay the amount or failure to file a return.

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 finds sufficient cause does exist to waive the penalty associated with the withholding tax return, but finds that sufficient cause does not exist to waive the interest. It is so ordered.

DATED this 9 day of SEPTEMBER, 1997.

BY ORDER OF THE UTAH STATE TAX COMMISSION.

G. BLAINE DAVIS

Administrative Law Judge

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

DATED this 9 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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