97-1246
INCOME
Signed 11/25/97
BEFORE THE UTAH STATE TAX
COMMISSION
____________________________________
PETITIONERS, )
:
Petitioners, ) DECISION
:
v. )
:
AUDITING DIVISION
OF THE ) Appeal No. 97-1246
UTAH STATE TAX
COMMISSION, :
) Account No. #####
:
Respondent. ) Tax
Type: Income Tax
_____________________________________
IMPORTANT NOTICE: On October 7, 1997 the Utah Supreme Court, in Evans
and Sutherland Computer Corp v. Utah State Tax Commission,
invalidated the informal adjudicative process by disallowing trial de novo to the
District Court. Therefore, your appeal
is now being processed as a formal adjudicative proceeding. Under this process, you are entitled to an
additional right. Utah Law allows for
an Initial Hearing before the matter is heard on the record in a formal
proceeding. Therefore, the hearing held
in this matter will constitute the Initial Hearing. Please note in the body of the decision your right to, and the
method of request for, a formal hearing.
STATEMENT OF CASE
This matter came
before the Utah State Tax Commission pursuant to the provisions of Utah Code
Ann. '59-1-502.5. An Initial Hearing was held on September 29,
1997. Gail S. Reich, Administrative Law
Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner by
telephone was NAME. Present and
representing Respondent were Mr. Frank Hales and Mr. Brent Taylor, of the
Auditing Division.
Based upon the
evidence in the file and presented at the hearing, the Commission makes its:
FINDINGS
This appeal
involves the 1991 income tax year. A
10% negligence penalty was imposed for failure to file an amended return within
90 days of an adjustment at the federal level for approximately $$$$$. In
addition, penalties are imposed for late payment of the additional amount
assessed as the result of an audit from information sent to the state by the
federal government. Petitioner
indicates that the information sent was premature since he was continuing to
fight the battle at the federal level.
Ultimately Petitioner was successful in getting the adjustment made at
the federal level changed. As a result
of that change the state once again corrected its records which resulted in a
downward adjustment to the additional amount of tax due. That amount, once assessed, was paid in a
timely fashion by Petitioner. However,
the fact remains that Petitioner never did file an amended return within 90
days of any of the adjustments made at the federal level as are required by
state law.
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, it has been determined that the 10% negligence
penalty for failure to file an amended return was properly imposed and that the
interest properly reflects the fact that Petitioner and not the Respondent had
the use of the funds in the interim.
However, it is deemed appropriate under these circumstances to waive the
penalty imposed for late payment since Petitioner was continuing to work with
the federal government to adjust the federal records and according to
Petitioner did inform the Tax Commission of that situation. Upon final correction and upon assessment by
the State, Petitioner did pay in a timely fashion. It is so ordered.
This Decision does
not limit a party's right to a Formal Hearing.
Any party to this case may file a written request within thirty (30)
days of the date of this decision to proceed to a Formal Hearing. Such a request shall be mailed to the
address listed below and must include the Petitioner's name, address, and
appeal number:
Utah State Tax Commission
Appeals Division
210 North 1950 West
Salt Lake City, Utah 84134
Failure to request a
Formal Hearing will preclude any further administrative action or appeal rights
in this matter.
DATED this _____ day of
____________, 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 25 day
of NOVEMBER, 1997.
BY ORDER OF THE
UTAH STATE TAX COMMISSION.
W. Val Oveson Richard B. McKeown
Chairman Commissioner
Joe B. Pacheco Pam Hendrickson
Commissioner Commissioner
^^